The Ford Motor Company (usually called Ford; sometimes called FoMoCo), (NYSE: F) is an American multinational corporation that manufactures automobiles and is the third largest automaker in the world.

The automaker was founded by Henry Ford in Dearborn, Michigan, United States (where the company is currently headquartered), and incorporated in 1903. In its twentieth century heyday, Ford, along with General Motors and Chrysler, were known as Detroit's "Big Three" automakers, companies that dominated the American auto market. Toyota surpassed Ford in revenue starting in 2004. Ford remains one of the world's ten largest corporations by revenue.

Ford introduced methods for large-scale manufacturing of cars, and large-scale management of an industrial workforce, especially elaborately engineered manufacturing sequences typified by the moving assembly lines. Henry Ford's combination of highly efficient factories, highly paid workers, and low prices revolutionized manufacturing and came to be known around the world as Fordism by 1914.

Early History

Ford was launched from a converted wagon factory in 1903, with $28,000 cash from twelve investors. During its early years, the company produced just a few cars a day at its factory on Mack Avenue in Detroit. Groups of two or three men worked on each car from components made to order by other companies.

In 1908, the Ford company released the Ford Model T. The first Model Ts were built at the Piquette Manufacturing Plant. The company moved production to the much larger Highland Park Plant to keep up with the demand for the Model T, and by 1913 had developed all of the basic techniques of the assembly line and mass production. Ford introduced the world's first moving assembly line that year, which reduced chassis assembly time from 12½ hours in October to 2 hours, 40 minutes. However these innovations were not popular and turnover of workers was very high. Turnover meant delays and extra costs of training, and use of slow workers. In January 1914 solved the problem by doubling pay to $5 a day, cutting shifts from nine hours to an eight hour day, and instituting hiring practices that identified the best workers. Productivity soared and employee turnover plunged, as the cost per vehicle plummeted. Ford cut prices again and again and invented the system of franchised dealers who were loyal to his brand name.

By the end of 1913, Ford was producing 50% of all cars in the United States, and by 1918 half of all cars in the country were Model T's. Henry Ford is reported to have said that "any customer can have a car painted any color that he wants so long as it is black." This was because black paint was quickest to dry; earlier models had been available in a variety of colors.

In 1919, Edsel Ford succeeded his father as president of the company, although Henry Ford still kept a hand in management. Although prices were kept low through highly efficient engineering, the company used an old-fashioned personalized management system, and neglected consumer demand for upscale vehicles. It steadily lost market share to GM and Chrysler, as these and other domestic and foreign competitors began offering fresher automobiles, with more innovative features and luxury options. GM had a range of models from relatively cheap to luxury, tapping all price points in the spectrum, while less wealthy people purchased used Model T's. The competitors also opened up new markets by extending credit for purchases, so consumers could buy these expensive automobiles with monthly payments. Ford initially resisted that approach, insisting that such debts would ultimately hurt the consumer and the general economy. Ford eventually joined in the credit markets in December 1927, when Ford unveiled the redesigned Model A, and retired the Model T after producing 15 million of them.

In 1925, Ford expanded its reach into the luxury auto market through its acquisition of the Lincoln Motor Company, and the Mercury division was established in the 1930s to serve the mid-price auto market. ^[1]

Post World War II developments

Henry Ford II, grandson of Henry Ford, served as President from 1945-1960, and as Chairman and CEO from 1960-1980. "Hank the Deuce" led Ford to became a publicly traded corporation in 1956. However, the Ford family maintains about 40% controlling interests in the company, through a series of Class B preferred stocks.

In 1946 Robert S. McNamara joined Ford Motor Company as manager of planning and financial analysis. He advanced rapidly through a series of top-level management positions to the presidency of Ford on 9 November 1960 one day after Kennedy's election. The first company head selected outside the Ford family, McNamara received substantial credit for Ford's expansion and success in the postwar period. Less than five weeks after becoming president at Ford, he accepted Kennedy's invitation to join his cabinet, as Secretary of Defense. He served in that post from January 21, 1961 - February 29, 1968

In the 1950s, Ford introduced the iconic Thunderbird in 1955 and the Edsel brand automobile line in 1958; Edsel was cancelled after less than 27 months in the marketplace in November 1960. The corporation bounced back from the failure of the Edsel by introducing its compact Ford Falcon in 1960 and the Mustang in 1964. By 1967, Ford of Europe was established.

Lee Iacocca was involved with the design of several successful Ford automobiles, most notably the Ford Mustang; he was also the "moving force," as one court put it, behind the notorious Ford Pinto. He promoted other ideas which did not reach the marketplace as Ford products. Eventually, he became the president of the Ford Motor Company, but he clashed with Henry Ford II and ultimately, in 1978, he was famously fired by Henry II, despite Ford posting a $2 billion dollar profit for the year.

Harold Poling served as Chairman and CEO from 1990-1993. Alex Trotman was Chairman and CEO from 1993-1998, and Jacques Nasser served at the helm from 1999-2001. Henry Ford's great-grandson, William Clay Ford Jr., is the company's current Chairman of the Board and CEO.

"The Way Forward"

Ford responded to the circumstances that lead to the bond downgrade by creating a plan to reduce the company's fixed capital costs while maintaining a special focus on cars and car-based crossover vehicles. Over time, it hopes to make more of its product line profitable instead of relying on a limited portion of the products for profit. Making good profits across the product line requires that the company reduce the costs of development and production, while introducing new products that connect with consumers.

In the latter half of 2005, Chairman Bill Ford asked newly-appointed Ford Americas Division President Mark Fields to develop a plan to return the company to profitability. Fields previewed the Plan, dubbed "The Way Forward", at the December 7, 2005 board meeting of the company; and it was unveiled to the public on January 23, 2006. "The Way Forward" includes resizing the company to match current market realities, dropping some unprofitable and inefficient models, consolidating production lines, and shutting down seven vehicle assembly plants and seven parts factories. Among these are plants in St. Louis Assembly (near St. Louis), Atlanta Assembly (near Atlanta), Batavia Transmission (Batavia, Ohio), Windsor Casting (Windsor, Ontario, Canada), and Wixom Assembly (Wixom, Michigan). Two more plants were later announced for closure in 2008: the Ford Ranger Twin Cities Assembly Plant in St Paul, Minnesota, and the Ford F-series Norfolk Assembly plant in Norfolk, Virginia [2]. Up to 30,000 hourly and salaried jobs (28% of the total workforce) in North America over the next six years are expected to be eliminated ^[2], which is comparable to similar cutbacks previously announced at General Motors. These cutbacks are consistent with Ford's roughly 25% decline in U.S. automotive market share since the mid-late 1990s.

Ford's realignment also included the sale of its wholly-owned subsidiary, Hertz Rent-a-Car to a private equity group for $15 billion in cash and debt acquisition. The sale was completed on December 22, 2005. A joint venture with Mahindra and Mahindra Limited of India ended with the sale of Ford's 15 percent stake in 2005.

Chairman Ford became president of the company in April 2006 with the retirement of Jim Padilla. He will run the company with an executive operating committee made up of Mark Schulz, Anne Stevens, Lewis Booth, Don Leclair, and Mark Fields.

Brands and marques

Today, Ford Motor Company manufactures automobiles under the Lincoln and Mercury brand names. In 1958, Ford introduced a new marque, the Edsel, but poor sales led to its discontinuation in 1960. Later, in 1985, the Merkur brand was introduced; it met a similar fate in 1989.

Ford has major manufacturing operations in Canada, Mexico, the United Kingdom, Germany, Brazil, Argentina, Australia, China, and several other countries, including South Africa where, following divestment during apartheid, it once again has a wholly-owned subsidiary. Ford also has a cooperative agreement with Russian automaker GAZ.

Since 1989, Ford has acquired British nameplates Aston Martin, Jaguar, Daimler (div. of Jaguar), and Land Rover, and Volvo Cars from Sweden, as well as a controlling share (33.4%) of Mazda of Japan, with which it operates an American joint venture plant in Flat Rock, Michigan called Auto Alliance. It has spun off its parts division under the name Visteon. Its prestige brands, with the exception of Lincoln, are managed through its Premier Automotive Group.

Formula Ford

This formula for single seater cars without wings, and originally on road tyres, was conceived in 1966 in the UK as an entry level formula for racing drivers. Many of today's racing drivers started their car racing careers in this category.