MANAGEMENT ADJUSTMENTS FOR PREFABRICATED COMPONENT USING IN FIT-OUT WORKS: CASE ANALYSIS AND RECOMMENDATIONS

ABSTRACT

FORD MOTOR COMPANY (FORD) IS AN AMERICAN CAR MANUFACTURER AND ONE OF THE LEADING AUTOMOBILE MANUFACTURERS WITH OVER A CENTURY OF HISTORY IN THE AUTO INDUSTRY. THE COMPANY IS HEADQUARTERED IN THE UNITED STATES, IN DEARBORN, MICHIGAN. HOWEVER, IT HAS OPERATIONS IN OVER 125 COUNTRIES AROUND THE WORLD, INCLUDING EUROPE, AFRICA, ASIA, AND SOUTH AMERICA, OFFERING A WIDE RANGE OF VEHICLES UNDER THE FORD AND LINCOLN BRANDS. THE COMPANY HAS DEMONSTRATED RESILIENCE AND ADAPTABILITY IN RESPONSE TO SHIFTS ACCORDING TO CONSUMER PREFERENCES, TECHNOLOGY ADVANCEMENTS, AND GOVERNMENT REGULATIONS. THE COMPANY HAS BEEN INVESTING CONSTANTLY TO RESTRUCTURE AND POSITION ITSELF AND REMAIN COMPETITIVE. THEREFORE, FINDING STRATEGIES TO BOOST SALES AND GET HIGH RETURNS FROM INVESTED CAPITAL IS A MUST FOR THE COMPANY TO KEEP ITS MARKET SHARE, EVEN THOUGH THIS IS STILL A CHALLENGE DUE TO THE NATURE OF THE AUTOMOTIVE INDUSTRY, WHICH BRINGS INTENSE COMPETITION FROM BOTH TRADITIONAL AND NEW ENTRANTS, PARTICULARLY EV MANUFACTURERS. IN THIS STUDY THE FOCUS IS NOT ONLY TO ESTIMATE THE INTRINSIC VALUE OF FORD MOTOR COMPANY AS OF 31, DECEMBER 2023, BUT ALSO TO ANALYZE ESSENTIAL ASPECTS OF THE COMPANY INCLUDING SWOT, PESTEL, AND PORTER’S FIVE FORCES ANALYSIS TO GET A FRAMEWORK OF INTERNAL AND EXTERNAL ENVIRONMENT OF THE COMPANY WHICH ENABLES US TO IDENTIFY STRATEGIC OPPORTUNITIES, COMPETITIVE ADVANTAGE, VULNERABILITIES, AND THREATS OF THE COMPANY. AFTER UNDERSTANDING THE DYNAMICS OF THE COMPANY AND THE ECONOMIC OVERVIEW, WHICH ARE CRUCIAL TO PREDICT THE IMPACT OF KEY ASSUMPTIONS WHEN EVALUATING THE COMPANY’S INTRINSIC VALUE. FOR THE SECOND PART OF OUR STUDY, THE ATTENTION GOES TO THE FINANCIAL ANALYSIS OF BOTH HISTORICAL AND FORECASTED FINANCIAL STATEMENTS THAT ARE EXTREMELY IMPORTANT TO APPLY FOR THE DISCOUNTED CASH FLOW VALUATION METHODS AND LATER TO PERFORM A SENSITIVITY ANALYSIS TO UNDERSTAND THE COMPANY’S FINANCIAL PERFORMANCE. THEREFORE, FORD MOTOR COMPANY’S INTRINSIC VALUE FROM THE THREE DISCOUNTED CASH FLOW MODELS LEADS US TO CONCLUDE THAT THE FORD STOCK’S PRICE IS CURRENTLY UNDERVALUED, AND IT IS EXPECTED TO GROW IN THE FUTURE.