HARPREET FORD

IN COMPANY TRAINING REPORT

ON

“Sales & Marketing Strategies Adopted By

FORD INDIA LTD”

HARPREET FORD

Submitted in partial fulfillment of the requirement of

Bachelor of Business Administration (BBA),
Guru Jambheshwar University of Science
& Technology, Hisar

Training Supervisor: Submitted by:

Mr. Jeffrey Noris Aditya Nakra

Sales-Manager Enrolment No. 05511001047

Session: 2007-08

Directorate of Distance Education

Guru Jambheshwar University of Science
& Technology, Hisar (HARYANA)
 HARPREET FORD

INDEX

PREFACE……………….…………………………………………………………….3

EXECUTIVE SUMMARY…………………………………………………………...5

INTRODUCTION…………………………………………………………………….7

PROFILE AND ORGANISATION STRUCTURE OF THE CO…………………8

OBJECTIVES……………..………………………………………………………....26

RESEARCH METHODOLOGY...…………………………………………………27

ANALYSIS AND INTERPRETATION……………………………………………28

CONCLUSION……………………....………………………………………………47

RECOMMENDATIONS.……………………...……………………………………49

REFRENCES……………………...…………………………………………………51

ANNEXURE.…………………………………………………………………………52

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 HARPREET FORD

PREFACE

Automobiles have become an indispensable part of our lives, an extension

of the human body that provides us faster, cheaper and more convenient mobility

every passing day. Behind this betterment go the efforts of those in the industry, in

the form of improvement through technological research.

What actually lie behind this betterment of the automobiles are the opinions,

requirements, likes and dislikes of those who use vehicles.

These wheeled machines affect machines affect our lives in ways more than

one. Numerous surveys and research are conducted throughout the world every

now and then to reveal one or the other aspect of automobiles, be it about the

pollution caused due to vehicle population in cities, or rising motor accidents and

causes, vehicular technology, alternative medicine and so on.

Irrespective of these above aspects there is one more thing, which also

needs attention is customer satisfaction. Customer satisfaction is abroad term,

which includes many things like post sale service satisfaction, dealership locality

towards customers, way of treatment at these dealerships and service stations,

solving the customers problems and concerns to their full satisfaction and so on.

Thus, various parameters are needed to be study.

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The topic of my summer training research was the study of customer

satisfaction index. In this research I have done the study of various aspects of

customer satisfaction.

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EXECUTIVE SUMMARY

One whole section of this study is devoted to a profile of the automobile industry as
it exists today in different parts of the world. Here, an attempt has been made to
dwell upon different players with their global operational network. However, the
basic purpose is not to highlight the performance and strategic initiatives of
different companies ‘per se’, but to emphasize the striking ‘push’ and ‘pull’ factors
that constitute the fabric, contours and orientations of global automobile market on
national, transnational and continental scales. This section is followed by another
chapter under the heading ‘company analysis’, which aims to briefly trace the
origin and evolution of Ford as a global automobile giant along with its internal
restructuring and the process of structural strategic readjustment triggered by its
management to reckon with the driving forces of automobile market in different
contexts.

The study also focuses the sales trends, marketing trends, technology
advancements, demand and supply situation as well as different aspects of
automobile business extensively. In this regard, I deem it significant to mention a
few characteristics differences between situations and patterns of European as
well as American Automobile markets on the one hand and Asian market on the
other. One major difference lies in what can be termed as the facility of
replacement for different target groups of consumers. In European and American
markets, consumers may get their old vehicles replaced by brand-new ones and
thus, are able to save the cost and labour of repairing. On the other hand, the
automobile consumers in the Asian markets, have considerably little access to the
privilege of replacement. So, they have to take resort to repairing only when some
major or minor defect occurs in their vehicles. The basic reason for this difference
rests on the respective difference in the labour costs in these two contexts of
marketing. As we see, the replacement facility for target consumers draws
sustenance from much higher labour costs prevailing in the American as well as
European markets. On the other hand, labour costs are substantially low in
different Asian countries. That is why repairing is in vogue.

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Here, I would like to illustrate this point by presenting a brief analysis of the
financial performance of Ford, the automobile giant vis-à-vis its marketing and
sales situation as affected by the labour’s share or participation in them and
magnitude of the labour cost factor in their accomplishment.

The Ford care illustrates a fundamental point : when sales volume falls,
value added generated will also fall, labour’s share of value added will increase,
and profit will decline. In this situation, if there is no prospect of an immediate
sales recovery, job losses are inevitable when the firm has to renormalize labour’s
share of value added.

INTRODUCTION

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 HARPREET FORD
Contemporary world of business is characterised by the emergence of numerous

trends and strategies of unprecedented potentials. The essential thrust of all

these, as it can be seen in the way of their formulation, structuring, paradigms of

execution and pragmatic fallouts, is not only on widening the horizons business

operations to a formidably global extent, but also on realizing the prospects of a

safe future amidst the key sectors of business and economy. Among these

strategies, the strategy of global alliance has come up as perhaps the most ‘talked

about’ and ‘sought after’ one, which the global business managers of different

companies are striving indefatigably to work out, each in accordance with one’s set

targets and objectives. The benefits and bottlenecks which the attainment of a

global business alliance involves; the pre-requisites and demands of such alliance;

the way it compels the alliance partners of bring about fundamental policy changes

in different spheres of their business operations in different spheres of their

business operations; the way it inculcates in them a fresh sense of reciprocity by

bringing into focus new set of operational urgencies and attitudinal imperatives

arising out of the ‘merger of objects’ as well as the ‘merger of interests’; the

futuristic implications of imbibing and putting into practice the terminologies of the

new business sense underlying such alliance – are some of the basic issues which

have been taken up by the present study.

PROFILE AND ORGANISATION STRUCTURE OF THE

COMPANY :-

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History of henry ford “the innovator”

The story of Henry Ford is not of a prodigy entrepreneur or an

overnight success. Ford grew up on a farm and might easily have remained in

agriculture. But something stronger pulled at Ford’s imagination: mechanics,

machinery, understanding how things worked and what new possibilities lay in

store. As a young boy, he took apart everything he got his hands on. He quickly

became known around the neighborhood for fixing people’s watches.

In 1896, ford invented the Quadricycle. It was the first “horseless carriage”

that he actually built. It’s a far cry from today’s cars and even from what he

produced a few years later, but in a way it’s the starting point of Ford’s career as a

businessman. The Quadricycle showed enough popularity and potential that it

launched the beginning of Ford’s business ventures. An idea into business Ford

motor company was founded on June 16, 1903. The first Ford, the model a, was

being sold in Detroit a few months later. When founded, Ford motor company was

just one of 15 car manufacturers in Michigan and 88 in the US. But as it began to

turn a profit within its first few months, it becomes clear that Henry Ford’s vision for

the automotive industry was going to work, and work in a big way. During the first

five years of Ford motor company’s existence, Henry Ford, as chief engineer and

later as president, directed a development and production

program that stared in a converted wagon shop. Henry Ford’s insistence that the

company’s future lay in the production of affordable cars for a mass market caused

increase his own holdings to 58.5 percent. Henry Ford become president in 1906,

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 HARPREET FORD
replacing John S. Gray, a Detroit banker who had served as the company’s first

president.

In 1917, Ford motor company began producing trucks and tractors. In 1919

a conflict with stockholders over the millions to be spent building the giant rouge

manufacturing complex in Dearborn, Michigan led to the company becoming

wholly owned by Henry ford and his son, Edsel, who then succeeded his father as

president. After Edsel Ford passed away in 1943, a saddened Henry Ford

resumed the presidency.

Henry Ford resigned for the second time at the of World War II. His eldest

grandson, Henry Ford II; become president on sept.24, 1945. Even as Henry Ford

II drove the industry’s first postwar car off the assembly line, he was making plan to

reorganize and decentralize the company to resume its prewar position as a major

force in a fiercely competitive auto industry.

He was president from 1945 until 1960 an chief executive officer from 1945 until

1970. He was chairman of the board of directors from 1960 until 1980, and

remained as chairman of the finance committee from 1980 until his death in1987.

Now, at the beginning of its second century, another Ford family member has been

named CEO of Ford Motor Company, the first family member to hold the position in

more than 20 years. Like his uncle, Henry Ford II, William Clay Ford Jr. (great-

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grandson of Henry Ford) leads a company where “family” has a much broader

meaning referring to far more than just those with the last name “Ford.” Today, the

Ford Family comprises employees, dealers, suppliers, shareholders, customers,

and more-all those that help fulfill the vision Bill Ford has defined for the company:

to create great products that benefit customers, shareholders, and society.

HISTORY OF COMPANY

The Dream Becomes a Business

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 HARPREET FORD
Ford Motor Company entered the business world in June 16, 1903, when

Henry Ford and 11-business associate signed the company’s articles of

incorporation. With $28,000 in cash, the pioneering industrialists gave birth to what

was to become one of the world’s largest corporations. Few companies are as

closely identified with the history and development of industry and society

throughout the 20th century as Ford motor company’s beginnings were modest.

The company had anxious moments in its infancy. The earliest record of a

shipment is July 20, 1903, approximately one month after incorporation, to a

Detroit physician. With the company’s first sale came hope-a young Ford Motor

Company had taken its first steps. Mass production on the line perhaps Ford Motor

Company’s single greatest contribution to automotive manufacturing was the

moving assembly line. First implemented at the Highland Park plant (in Michigan,

US) in 1913, the new technique allowed individual workers to stay in one place and

perform the same task repeatedly on multiple vehicles that passed by them. The

line proved tremendously efficient, helping the company far surpasses the

production levels of their competitors- and making the vehicles more affordable.

The First Vehicles

Henry Ford insisted that the company’s future lay in the production of

affordable cars for mass market. Beginning in 1903, the company began using the

first 19 letters of the alphabet to name new cars. In 1908, the Model T was born.

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19 years and 15 million Model T’s later, Ford Motor Company was a giant industrial

complex that spanned the globe. In 1925, Ford Motor Company acquired the

Lincoln Motor Company, thus branching out into luxury cars, and in the 1930’s, the

mercury division was created to establish a division centered on mid-priced cars.

Ford Motor Company was growing and becoming a Global Company.

In the 50’s came the thunderbird and the chance to own a part of Ford

Motor Company. The company. The company went public and, on Feb 24, 1956,

had about 350,000 new stockholders. Henry Ford II’s keen perception of political

and economic trends in the 50’s led to the global expansion of FMC in the 60’s,

and the establishment of Ford of Europe in 1967, 20years ahead of the European

Economic Community’s arrival. The company established its North American

Automotive Operation in 1971, consolidating U.S., Canadian, and Mexican

operation more than two decades ahead of the North American free trade

agreement. Ford Motor Company started the last century with a single mane

envisioning products.

It would meet the needs of people in a world on the verge of high-gear

industrialization. Today, Ford Motor Company is a family of automotive brands

consisting of: Ford, Lincoln, Mercury, Mazda, Jaguar, Land Rover, Aston Martin,

and Volvo. The company is beginning its second century of existence with a

worldwide organization that retains and expands Henry Ford’s heritage by

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developing products that serve the varying and ever-changing needs of people in

the global community.

The Concept of Dealership

Ford Motor Company first introduced a Ford and Lincoln Mercury Dealership

service brand in 1991 to help provide the highest level of owner satisfaction

possible. Over the years, the service brand has contributed too much of the

vehicles brands’ success, increasing repeat purchases and strengthening owner

loyalty. Today, Genuine pars & service continue to grow by providing customers

genuine peace of mind. From oil changes to brakes service to name brand tires,

Ford, Lincoln, and Mercury owners know the dealership is the place for their entire

vehicle needs.

HISTORY OF FORD INDIA LTD

The Ford Motor Company has a rich of legacy of translating better motoring

ideas to the roads. It has manufactured notable brands such as the Ford, Lincoln,

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mercury and the Jaguar. It is among the top five industrial corporations in the world

and is available in more the 200 countries around the world.

Ford has entered the Indian market through a tie – up with Mahindra Motors

to manufacture the Escort. Sold to over 18 million owners worldwide, the models

available in India are specially engineered foe Indian conditions. Ford has sold

over 260,000,000 vehicles around the world, and is all geared to make India a

global player in automobiles.

With an investment of over Rs. 1700 crores, and in an area encompassing

350 acres, Ford has set up its own new, integrated manufacturing plant at

Maraimalai nagar near chennai. It has been the endeavor at Mahindra fords to

manufacture India’s top quality cars. This is secured through a quality check

program based on the principles of NOVA – c (new overall Vehicle Audit –

Customer) wherein daily random checks are conducted from a customer’s point of

view. To be doubly sure, routine calls are made to dealership to check the quality

of cars delivered to them. At Mahindra dealerships are present trained

professionals who provide the best levels of service in India. Its intensive

manpower training, advanced service equipment and dedicated consumer

satisfaction are there their plus point, which is being followed by the entire industry.

Acknowledgement has come in the form of the J D power 1997 India Initial Quality

and customer satisfaction Awards. These internationally acclaimed and recognized

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awards voted the Ford Escort as the best Quality car and the Mahindra Ford and

its dealerships were rated the highest in Customer satisfaction. This is an honour

as it it’s only the second time in automotive history that the same

brand/manufacturer has received both the awards in the same year.

COMPANY PROFILE

Ford Motor Company. The principal activities of the Group are within two principal
business segments. The Automotive segment consists of the design, manufacture,
sale and service of cars, trucks, automotive components and systems. The
Financial Services segment consists of vehicle-related financing, leasing and
insurance, renting and leasing of cars and trucks and renting industrial and
construction equipment and other activities. Visteon Corp spun-off during the
second quarter of 2005. During the year, the Company purchased the Land Rover
business from the BMW Group. The Company has operations in over 30 countries
and sells vehicles in over 200 markets. During the year, the company sold 7.4
million vehicles throughout the world. Automotive accounted for 83% of 2005
revenues; ford credit services, 14% and rental of vehicle and equipment, 3%.

Competitor Analysis

Ford Motor Company operates in the Motor vehicles and car bodies sector. This
analysis compares Ford with three other major automobile manufacturers :
General Motors Corporation (2005 sales of $182.91 billion of which 88% was
Automotive, communications services and ), DaimlerChrysler AG of Germany
(2005 sales: 317.60 billion Deutsche Mark [US$144.23 billion] of which 42% was
Chrysler Cars), and Toyota Motor Corporation which is based in Japan (2006 sales
of 13.42 trillion Japanese Yen [US$108.07 billion] of which 89% was Automotive).
Note: not all of these companies have the same fiscal year: the most recent data
for each company are being used.

Sales Analysis

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 HARPREET FORD
Sales levels dropped significantly in the second quarter of 2006 versus the
previous year's second quarter. During the second quarter of 2006, sales at Ford
totalled $42.31 billion. This is a drop of 42.0% from the $72.91 billion in sales at the
company during the second quarter in 2005. This was the biggest quarterly decline
in sales at Ford in the previous 33 quarters. During the first two quarters of 2006,
sales totalled $84.68 billion, which is 26.9% lower than through the first two
quarters of 2005.

Ford reported sales of $170.06 billion for the year ending December of 2005. This
represents an increase of 4.6% versus 2004, when the company's sales were
$162.56 billion.

Recent Sales at Ford

200
Figures in Billions of

150
US Dollars

100

50

0
1996 1997 1998 1999 2000
2002 2003 2004 2005 2006

(Source : www.corporateinformation.com)

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See Table-6 in Appendix for complete 10 year Sales
Most of the company's 2005 sales were in its home market of the United States: in
2005, this region's sales were $118.37 billion, which is equivalent to 69.6% of total
sales. In 2005, sales in the United States were up 5.3% to $118.37 billion.
Although the company's overall sales increased, sales were not up in all regions of
the world: sales in Europe were down 3.2% (to $32.13 billion).

Ford currently has 345,991 employees. With sales of $170.06 billion, this equates
to sales of US$491,527 per employee.

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Sales Comparisons (Most Recent Fiscal Year)

Sales Sales/
Year (US$bl Sales Emp
Ended ns) Growth (US$)
COMPANY LARGEST REGION
the United States
Ford Dec 2005 170.064 4.6% 491,527
(69.6%)

General Motors the United States

Dec 2005 182.911 3.6% 473,863
Corporation (74.6%)

the United States

DaimlerChrysler AG Dec 2005 144.230 8.3% 346,289
(52.0%)

Toyota Motor
Mar 2006 108.067 4.2% 501,125 Japan (50.3%)
Corporation

(Source : www.corporateinformation.com)

Recent Stock Performance

In recent years, this stock has performed terribly. In 2004, the stock traded as high
as $67.88, versus $17.13 on 12/7/06.

2001 2002 2003 2004 2005 2006

(Source : www.corporateinformation.com)

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For the 52 weeks ending 12/7/06, the stock of this company was down 29.0% to
$17.13. During the past 13 weeks, the stock has fallen 8.7%. During the past 52
weeks, the stock of Ford has performed worse than the three comparable
companies, which saw changes between -16.4% and 1.2%.

During the 12 months ending 9/30/06, earnings per share totalled $0.50 per share.
Thus, the Price / Earnings ratio is 34.26. These 12 month earnings are
substantially lower than the earnings per share achieved during the calendar year
ending last December, when the company reported earnings of 3.80 per share.
Earnings per share fell 35.2% in 2005 from 2004. Note that the earnings number
includes a $.84 charge and excludes a $1.50 charge Disp in 2005 (includes a $.09
charge Dec, includes a $.07 charge Sep and includes a $.68 charge and excludes
a $1.50 charge Disp Jun).

This company is currently trading at 0.18 times sales. Ford is trading at 1.99 times
book value. The company's price to book ratio is higher than that of all three
comparable companies, which are trading between 0.97 and 1.63 times book
value.

Summary of company valuations

Price/ Price/ 52 Wk
Book Sales Pr Chg
Company P/E
Ford 34.3 1.99 0.18 -29.00%

General Motors Corporation 143.3 0.97 0.16 1.16%

DaimlerChrysler AG N/A 1.16 0.30 1.03%

Toyota Motor Corporation 19.1 1.63 0.84 -16.45%

(Source : www.corporateinformation.com)

The market capitalization of this company is $31.02 billion. The capitalization of the
floating stock (i.e., that which is not closely held) is $29.80 billion.

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Dividend Analysis

During the 12 months ending 9/30/06, Ford paid dividends totalling $1.05 per
share. Since the stock is currently trading at $17.13, this implies a dividend yield of
6.1%. This company's dividend yield is higher than the three comparable
companies (which are currently paying dividends between 0.8% and 4.8% of the
stock price). During the quarter ended 9/30/06, the company paid dividends of
$0.15 per share. The company has paid a dividend for 6 straight years.

During the same 12 month period ended 9/30/06, the Company reported earnings
of $0.50 per share. Thus, the company is paying out dividends that are higher than
the earnings.

Profitability Analysis

On the $170.06 billion in sales reported by the company in 2005, the cost of goods
sold totalled $110.81 billion, or 65.2% of sales (i.e., the gross profit was 34.8% of
sales). This gross profit margin is very slightly better than the company achieved in
2004, when cost of goods sold totalled 65.4% of sales.

Ford's 2005 gross profit margin of 34.8% was better than all three comparable
companies (which had gross profits in 2005 between 25.2% and 28.8% of sales).

The company's earnings before interest, taxes, depreciation and amorization

(EBITDA) were $35.63 billion, or 21.0% of sales. This EBITDA to sales ratio is
roughly on par with what the company achieved in 2004.Sak, when the EBITDA
ratio was 20.6% of sales. The three comparable companies had EBITDA margins
that were all less (between 10.4% and 16.1%) than that achieved by Ford.

In 2005, earnings before extraordinary items at Ford were $5.72 billion, or 3.4% of
sales. This profit margin is lower than the level the company achieved in 2004,
when the profit margin was 4.5% of sales.

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The company's return on equity in 2005 was 20.9%. This was significantly worse
than the already high 31.2% return the company achieved in 2004. (Extraordinary
items have been excluded).

Profitability Comparison

Gross Earns
Profit EBITDA bef.
Company Margin Margin extra
YEAR
Ford 2005 34.8% 21.0% 3.4%

Ford 2004 34.6% 20.6% 4.5%

General Motors Corporation 2005 28.8% 16.1% 2.4%

DaimlerChrysler AG 2005 25.2% 10.4% 1.5%

Toyota Motor Corporation 2006 27.4% 12.1% 3.5%

(Source : www.ford-india.com)

During the second quarter of 2006, Ford reported a loss per share of $0.41. In
comparison, in the second quarter of 2005, the company reported positive
earnings of $1.12 per share.

Ford reports profits by product line. During 2005, the itemized operating profits at
all divisions were $8.23 billion, which is equal to 4.8% of total sales. Of all the
product lines, Ford Credit Services had the highest operating profits in 2005, with
operating profits equal to 10.6% of sales. (However, Ford Credit Services only
accounts for 14% of total sales at Ford).

Automotive had the lowest operating profit margin in 2005, with the operating profit
equal to only 3.6% of sales. (This product line is the largest product line at Ford,
accounting for approximately 85% of sales in 2005).

Inventory Analysis

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As of December 2005, the value of the company's inventory totalled $7.51 billion.
Since the cost of goods sold was $110.81 billion for the year, the company had 25
days of inventory on hand (another way to look at this is to say that the company
turned over its inventory 14.7 times per year). This is an increase in days in
inventory from December 2004, when the company had $6.44 billion, which was
22 days of sales in inventory.

The 25 days in inventory is lower than the three comparable companies, which had
inventories between 31 and 56 days at the end of 2005.

Research and Development

Research and Development Expenses at Ford in 2005 were $6.80 billion, which is
equivalent to 4.0% of sales. In 2005, R&D expenditures dropped both as a
percentage of sales and in actual amounts: In 2004, Ford spent $7.10 billion on
R&D, which was 4.4% of sales.

The company's expenditures on R&D in 2005 were higher than all three
comparable companies (as a percentage of sales): General Motors Corporation
spent 3.6% of its sales on R&D, DaimlerChrysler AG spent 3.9%, and Toyota
Motor Corporation spent 3.6%.

Financial Position

As of December 2005, the company's long term debt was $98.89 billion and total
liabilities (i.e., all monies owed) were $261.79 billion. The long term debt to equity
ratio of the company is 5.13. This is significantly higher than where the long term
debt to equity ratio was in December 2004, when the long term debt to equity ratio
was only 2.75.

Ford does not appear to be very efficient in collecting payments: As of December

2005, the accounts receivable for the company were $83.82 billion, which is

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 HARPREET FORD
equivalent to 180 days of sales. This is higher than at the end of 2004, when Ford
had 168 days of sales in accounts receivable.

The 180 days of accounts receivable at Ford are higher than all three comparable
companies: General Motors Corporation had 116 days, DaimlerChrysler AG had
91 days, while Toyota Motor Corporation had 133 days outstanding at the end of
the fiscal year 2005.

FINANCIAL POSITIONS
LT Debt/ Days Days R&D/
Equity AR Inv. Sales
COMPANY YEAR
Ford 2005 5.13 180 25 4.0%

General Motors Corporation 2005 2.18 116 31 3.6%

DaimlerChrysler AG 2005 1.15 91 56 3.9%

Toyota Motor Corporation 2006 0.43 133 34 3.6%

(Source : www.ford-india.com)

GLOBAL STRATEGY

Ford Motor Co. has a legacy that still resounds through the industrial economy. In
the past, Massive scale yielded massive economies, which yielded competitive
advantage. But, as the organization grew larger, individual jobs became granular
and focused. Just as old Henry's assembly line parceled an intricate manufacturing
operation into discrete tasks, executives at Ford and other companies cleaved their
businesses into smaller product groups, then into functional units. Since the
executives at the top were the only ones who could see above the partitions, they
made the decisions, nudging increasingly immobile giants along their courses.

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The Ford business model perpetuated stability, and, as long as the universe
remained in order, it worked reasonably well. But, as Ford steers into a technology-
driven global economy, its weaknesses are becoming evident. Of course, the
company is still making money: Profits in 2004 hit an all-time high. But those profits
resulted mostly from truck sales, and were made mostly in the United States and
Canada. Elsewhere, Ford is sagging. It faces dramatic industry overcapacity and
near-flat worldwide demand. As a result, its stock is now trading at less than 10
times its earnings -- just one-third the multiple accorded the Standard & Poor's 500
as a whole.

As part of the automaker's cultural overhaul, Ford is embarking on a sweeping

attempt to mass-manufacture leaders. It wants to build an army of "warrior-
entrepreneurs" -- people who have the courage and skills to topple old ideas, and
who believe in change passionately enough to make it happen.

This year, Ford will send about 2,500 managers to its Leadership Development
Center for one of its four programs -- Capstone, Experienced Leader Challenge,
Ford Business Associates, and New Business Leader -- instilling in them not just
the mind-set and vocabulary.

INDUSTRY ANALYSIS : GLOBAL SCENARIO

Overview

The modern day passenger car is a modern economy's draught animal, driving the
growth of upstream industries like steel, iron, aluminum, rubber, plastics, glass,
and electronics and down stream industries like advertising and marketing,
transport and insurance. The car industry generates large amount of employment
opportunities in the economy. For example in the US, every sixth worker is
involved in the making of an automobile.
The world car production has increased from 44.66mn in 1996 to an estimated
48.3mn cars in 2004. Japan, Canada and USA brought about the major increase,
which contribute to 53% of the world's car production.

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The USA and Japan are the leaders with around 42% of the total world market.
However, since the last two to three years, the international passenger car industry
has been witnessing an over capacity of more than 30%. The trend suggests that
industry volumes may grow by just 2% or around 10mn vehicles per year. If this
situation continues for the next few years the world car market may witness
shakeout in the near future. Already signs towards this are being observed as the
phenomenon of mergers catches on. As per industry experts the number of major
players in the world car market may come down from present level of 30 to 5 in
next ten to fifteen years. The recent mergers in the international car market are
Ford-Volvo, Renault-Nissan, Daimler-Chrysler. A few more players are expected to
join the fray in the next few years so as to strengthen their hold in the world
market.
Among the top car manufacturing companies General Motors and Ford Motors
group of USA lead with a contribution of 15.8% and 11.6%, of world car production,
respectively. Volkswagen and Toyota stand third and fourth with more than 9%
contribution each to the world car production.

OBJECTIVES

1. To find out the satisfaction level of the owner of Ford Cars on

various parameters of Customer Satisfaction Index.

2. Analyze the satisfaction level on the following three parameters:

a. According to the AGE OF THE CUSTOMER

b. According to the AGE OF THE VEHICLE

c. According to OCCUPATION CLASS

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3. To find out the areas of improvement so as to increase the

satisfaction level of customers.

Need for the project: As seen in the several mature markets, with

increasing competition and resulting pressure on the sales margin,

manufacturers and dealers concentrate on after sales revenue to

enhance profitability. After sales services thus becomes a strategic too,

not only for differentiation but also sustenance.

RESEARCH METHODOLOGY

The Research Methodology, that I used, is EXPLORATORY RESEARCH.

In my research I have collected both primary data and secondary data. The sample

frame for my research was CUSTOMER’S OF FORD’S CAR IN DELHI REGION.

The sampling units were three DEALERSHIPS OF FORD INDIA. The sample size

was 154 customer of concerned was DELHI REGION.

The time period for the study was from 26th MAY’05 to 7th JULY’05.

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 HARPREET FORD
The method used for sampling is NON PROBABILISTIC CONVENIENCE

SAMPLING. The instrument used for collecting the data was UNDISGUISED,

CLOSE ENDED STRUCTURED QUESTIONNAIRE.

METHODOLOGY: For the primary data collection I have used undisguised

closed ended structured questionnaire. Threes questionnaires were filled by the

owners of the Ford cars who came to visit different dealerships cum service

stations for the repair or servicing of their during that period.

ANALYSIS AND INTERPRETATION

Question No. 1

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 HARPREET FORD

SATISFACTION WITH OVERALL SERVICE

EXPERIENCE

50
40
30
20
10
0
Completely Satisfied Somewhere Very Dissatisfied
Satisfied Dissatisfied

(Source : www.jdpower.com)

From the above bar graph it is found that about 83%(completely satisfied

37% and satisfied 46%) of customers are satisfied while only 18%(somewhere

dissatisfied 10% and very dissatisfied 8%) are in the category of unsatisfied

customers. Thus, from we can say that Ford India is having good reputation as far

as customers’ satisfaction with overall service experience is concern.

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Question No. 2

WAY YOU WERE TREATED AS

CUSTOMER

60
50
40
30
20
10
0
Completely satisfied somewhere dissatisfied
satisfied satisfied

(Source : www.jdpower.com)

From this bar graph it found that around 89% (completely satisfied 41% and

satisfied 48%) of customers are satisfied customers while only 11% (somewhere

dissatisfied 8% and very dissatisfied 3%) are dissatisfied one. Thus, it is concluded

that as far as treatment of customers is concerned, Ford India is having good

reputation among customers.

VEHICLE SERVICED AT HARPREET FOD DEALERSHIP .

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 HARPREET FORD

Question No. 3

EASE OF SCHEDULING MY SERVICE

APPOINTMENT
Poor
6%
Fair
4%
Good Excellent
36% 54%

(Source : www.harpreetford.com)

Out of 154 respondents 54% said that it is excellent while 36% said it is good when

they asked about the ease of getting appointments for the servicing of there

vehicles.

Question No. 4

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 HARPREET FORD

(Source : www.harpreetford.com)

REMIND ME WHEN MY VEHICLE IS DUE

FOR SERVICING

Good Poor
33% 9% Excellent
Other Good
15% Fair
Excellent Fair Poor
52% 6%

About the service reminders 85% said that they get service reminders as

and when it is due 15% are dissatisfied at this point.

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 HARPREET FORD
T

HE DEALERSHIP FACILITY

Question No. 5

When it was about the cleanliness and appearance of the facilities 60% of

customers said it is excellent while 24% said its good as they found clean and

good environment at the dealerships of Harpreet Ford India.

(Source : www.harpreetford.com)

COMFROT AND FRIENDLINESS OF

SERVICE DEPARTMENT WAITING AREA

Good
40%
Fair
12%
Other
21% Poor
9%
Excellent
39%

Excellent Good Fair Poor

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 HARPREET FORD
Question No. 6

While asking about the comfort and friendliness of service waiting area 79%

were satisfied with this and around 21% were not satisfied with this facility.

EFFICIENCY AND EFFECTIVENESS

Question No. 7

As far the acknowledge of customers is concern 63% were satisfied while

27% didn’t get prompt acknowledgement at the arrival.

(Source : www.harpreetford.com)

PROMPT ACKNOWLEDGE AT ARRIVAL

Poor Excellent
17% 27%
Fair
20%
Good
36%

Excellent Good Fair Poor

Question No. 8

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 HARPREET FORD
(Source : www.harpreetford.com)

REASONABLE TIME TAKEN IN OPNEING

THE JOB CARD

Poor
Excellent
20%
26%

Fair
18%
THROUGH INSPECTIONGood OF VEHICLE AND
36%
INFORM ME ABOUT THE CONDITION AND
ADVICE
Excellent SERVICE NEEDS
Good Fair Poor

Poor
Fair 6%
Excellent
18%
35%

Good
41%

Excellent Good Fair Poor

As far as the opening of job card is concerned it is one of the important area for

improvement because at one point where only 62% of the customers are satisfied,

20% are those who said that they are poor at opening the job cards. And also18%

said hat it is just fair service.

Question No. 9

At this parameter Ford India is having good image among its customer because

from the above pie chart it is found that 76%of the customers are completely

satisfied and only 6% are dissatisfied.

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 HARPREET FORD

(Source : www.jdpower.com)

PROVIDE ME FAIRLY GOOD COST ESTIMATE

FOR THE SERVICE TO BE PROVIDED
Excellent Good Fair Poor

Poor Excellent
15% 18%

Good
Fair
28%
39%

Question No. 10

PROVIDED ME FAIRLY GOOD TIME ESTIMATE

FOR THE SERVICE TO BE PROVIDED

Poor
Fair 7% Excellent
16% 34%

Good
43%
35

Excellent Good Fair Poor

 HARPREET FORD

(Source : www.jdpower.com)

The time estimate provided by the service advisors are same according to 77% of

the customers and in only 7% cases the time limit exceeded from the given

estimated time.

FIX THE PROBLEM THE FIRST TIME

(Source : www.jdpower.com)

QUALITY OF WORK PERFORMED

39
40 35
35
30
25 19
20
15
7
10
5
0
Excellent Good Fair Poor

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 HARPREET FORD

Question No. 11

According to 35% customers they have rated the quality of as excellent and

41% said it is good only 7% said that quality of work is very poor.

(Source : www.jdpower.com)

WAS SERVICE WORKED COMPLETED

PROPERLY THE FIRST TIME

Yes
Yes No No
78% 22%

Question No. 12

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 HARPREET FORD
About 78% said that their problems are fixed at first time of their visit while

22% said that they had visited more than once for the same problem to get the

problem fixed.

As the figure below says that 29% work has been done excellentely. The

promise made has been completeted fulfilled in a timely and professional manner

is termed as good by 40% people.22% of the customers feel that it is a fair deal

and only 9% of the customers feel that servicing of their vehicles is poor in context

of time and specialization.the company is making all kinds of efforts to reduce this

percentage of poor servicing and increasing the percentage in good and excellent

categories.

COMPLETELY SERVICING MY VEHICLE IN A TIMELY AND

PROFESSIONAL MANNER.

(Source : www.harpreetford.com)

HAVE MY VEHICLE READY WHEN

PROMISED

Poor 9

Fair 22

Good 40

Excellent 29

0 10 20 30 40

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 HARPREET FORD

Question no. 13

69% of Customers think that the time taken in servicing the vehicle is reasonable

while 31% comes in the category of either fair or poor.

Question No. 14

(Source : www.jdpower.com)

RETURNED MY VEHICLE CLEAN AFTER

SERVICE

Poor 5

Fair 11

Good 46

Excellent 38

0 10 20 30 40 50

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 HARPREET FORD
Except 5% of the total respondents, majority said those vehicles are

returned clean after service.

PROVIDED ME WITH THE CLEAR EXPLANATION OF SERVICE

PERFORMED

(Source:www.jdpower.com)

PROVIDED ME THE CLEAR EXPLAINATION

OF ALL THE SERVICE AND THEIR CHARGES

50

40

30
42
20 32
19
10
7
0
Excellent Good Fair Poor

Question No. 15

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 HARPREET FORD
After servicing it is very important duty of the service adviser to tell about all

the services performed and their charges. From the above graph it is found that

Harpreet Ford India’s service adviser are very good at this. About 74% customers

are satisfied while only 7% said that they are poor at this point.

Question No. 16

(Source : www.jdpower.com)

ADIVSED ME OF FUTURE
MAINTENANCE NEEDS

50
45
40
35
30
49
25
41
20
15
10
5 8 2
0
Excellent Good Fair Poor

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 HARPREET FORD
It is the duty service advisors to tell their clients about the future

maintenances needs of the vehicle. Service advisors of Ford India are good at this

point as shown from above graph. 90% are very satisfied whereas only 2%

customers are dissatisfied.

(Source : www.harpreetford.com)

GUIDE ME ON PROPER VEHICLE USAGE

TO PREVENT FUTURE PROBLEMS

50

40 48
45
30

20

10
8 1
0
Excellent Good Fair Poor

Question No. 17

From the above chart it is found that guidance regarding future maintenance

is quit well and service advisors are very effectively and efficiently do this task.

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 HARPREET FORD

Question No. 18

(Source : www.harpreetford.com)

CONTACTED BY DEALER AFTER SERVICE

No
2%

Yes
98%

Yes No

In sending reminders to their customers, DCRC plays a vital role and from it is

clear that they are doing their best.

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 HARPREET FORD
Question No. 19

About 93% customers said that get prompt follow-up calls from the Harpreet

Ford whereas only 1% customers said they didn’t get the follow-up calls.

(Source : www.harpreetford.com)

PROMPTNESS OF FOLLOWUP CALLS

RESOLVE MY CONCERNS WHEN I
70
CONTACTED
60
50
40 60
68
30 50
20 40
25
10 30
6 1
0 20
Excellent Good Fair Poor
10
0
Excellent Good Fair Poor
Series1 51 36 9 4

(Source : www. jdpower.com)

Question No. 20

Out of the total respondents around 87% customers are fully

satisfied whereas only 4% customers are not satisfied.

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 HARPREET FORD
(Source : www.harpreetford.com)

PROVIDE ME CLEAR AND HELPFUL ADVICE

50

40

30

20

10

0
Excellent Good Fair Poor
Series1 39 41 13 7

CONCLUSIONS

 The problem that the customers normally face at the service stations of Ford

India is the problem of time.

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 HARPREET FORD
 Another problem that the customers were facing was cost estimate for the

service to be provided

 From the analysis it is found the service of vehicle is not completed properly

the first time.

 The large number of customers are dissatisfied as the vehicle is not ready

when promised

 The most dissatisfied customers are in the age group of 45 – 54 years.

 The large numbers of customers are from business group and self

employed.

 The most dissatisfied class is self-employed between the two categories

given above.

 The area where the dealership lacks behind is the time management.

 Large number of jobs remains pending due to improper scheduling of the

jobs.

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 HARPREET FORD
 It is found that the customers are very satisfied with the DCRC as the rated

their service as the best.

 These are the major causes of dissatisfaction among the customers.

o Waiting time for getting vehicle serviced.

o Cost estimate for the service.

o Not fixing the problem the first time.

o Not prompt acknowledgement at the arrival.

RECOMMENDATIONS

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 HARPREET FORD
 Waiting time of the customers should be minimized and for that proper

scheduling of the jobs should be done and separate scheduling should be

done for booking and walk –in –jobs.

 Many jobs remain pending due to improper communication among various

departments like spare parts department, floor, customer care department

and washing section, so proper reporting system should be established and

communication channels are needed.

 Number of service advisors should be increased to overcome the workload

and number of pending jobs.

 Proper inventory level should be maintained to overcome the problem of

stock outs, and for this forecasting techniques should be used.

LIMITATIONS

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 HARPREET FORD
 Sample size of the 103 is not a good representation of the total population.

It should be around 1000 or more but it was not possible to collect due to

time constraints.

 It was difficult to get the response from the owners as when came to the

service station they were having problem with vehicle and when they leave

they were not willing to stay anymore.

 Owner’s responses were quite difficult to get because they generally send

their drivers.

 The finding depicts the scenario only one branch of Harpreet Ford India Ltd.

 Respondents’ errors were there in the analysis.

 There is lack of what statisticians call ‘sampling stability’.

REFERENCES

 J.D Power survey reports.

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 HARPREET FORD

 Websites:

 http://www.Ford.com/

 http://www.ford-india.com

 http://www.corporateinformation.com

 http://www.jdpower.com

 http://www.indiacar.net

 http://www.harpreetford.com

ANNEXURE

Harpreet Ford India Ltd

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 HARPREET FORD
(Customer View Point Score)

Q1. Satisfaction with overall service experience.

(a) Completely Satisfied (b) Satisfied

(c) Somewhere Dissatisfied (d) Very Dissatisfied

Q2. Way you were treated as customer.

(a) Completely Satisfied (b) Satisfied

(c) Somewhere Dissatisfied (d) Very Dissatisfied

Make It Convenient To Have My Vehicle Serviced At Your Dealership.

Q3. Ease of scheduling my service appointments.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q4. Remind me when my vehicle is due for servicing.

(a) Excellent (b) Good

(c) Fair (d) Poor

The Dealership Facility

Q5. Cleanliness and appearance of service facility.

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 HARPREET FORD
(a) Excellent (b) Good

(c) Fair (d) Poor

Q6. Comfort and friendliness of service dept. waiting area.

(a) Excellent (b) Good

(c) Fair (d) Poor

Efficiency and Effectiveness

Q7. Acknowledge me promptly when I arrived for service.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q8. Begin my service job cards within reasonable amount of time.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q9. Thoroughly inspect my vehicle, inform me of its condition & advice me

of its service need

(a) Excellent (b) Good

(c) Fair (d) Poor

Q10. Provided me with the fairly good cost estimate for the services to be

provided.

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 HARPREET FORD
(a) Excellent (b) Good

(c) Fair (d) Poor

Q11. Provided me with a fairly good time estimate of when service will be

completed.

(a) Excellent (b) Good

(c) Fair (d) Poor

Fix The Problem The First Time.

Q12. Quality of work performed.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q13. Was service work Completed Properly the First Time?

(a) Yes (b) No

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 HARPREET FORD

Complete Servicing Vehicle in a Timely and Professional Manner.

Q14. Have my vehicle ready when promised.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q15. Have my vehicle cleaned after service.

(a) Excellent (b) Good

(c) Fair (d) Poor

Provide Me With The Clear Explanation Of service Performed.

Q16. Provided me with the clear explanation of all the services and their

charges.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q17. Advise me of future maintenance needs.

(a) Excellent (b) Good

(c) Fair (d) Poor

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 HARPREET FORD

Q18. Guide me on proper vehicle usage to prevent future problems.

(a) Excellent (b) Good

(c) Fair (d) Poor

Call Me in a reasonable Amount of Time After My Service Visit To Ensure

That I’m Completely satisfied.

Q19. Called by dealer after service

(a) Yes (b) No

Q20. Promptness of Follow-up calls from the dealership.

(a) Excellent (b) Good

(c) Fair (d) Poor

Be Responsive To Question or Concerns I Bring to Your Attention

Q21. Answer my questions or resolve my concerns when I contact you

about them.

(a) Excellent (b) Good

(c) Fair (d) Poor

Q22. Provide me with clear and helpful advice.

(a) Excellent (b) Good

(c) Fair (d) Poor

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 HARPREET FORD

Brief description of project related terms

The occurrence of single problem is a source of dissatisfaction for customers.

Problem experience is not always something broken or loose. Many a times it is a

function of customers’ expectation of how a feature or a vehicle system should look

or perform and any performance short of this expectation is perceived as a

problem.

Satisfaction has two costs:

1. Ownership cost: It consists of cost across fuel, maintenance,

repairs and tires. Ownership cost is further divided into two sub

heads

a. Fixed cost of ownership: it is independent of km run, it consist of

monthly installments, insurance, and road tax etc.

b. Variable cost of ownership: It depends on per km run, the cost

comprises of fuel cost, repairs, maintenance cost, tyre cost etc. fuel cost

consisting 90% of the total variable cost of ownership. Maintenance and

repair cost consisting 8.5%, while tyre costing 1.5% of the total cost of

ownership.

2. Operating cost: It is based on actual cost per km. it is also affected

by customer expectations, product performance, after sales service and

manufacturers’ image.

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 HARPREET FORD

CUSTOMER SATISFACTION INDEX (CSI)

Customer Satisfaction Indexes are those parameters on the basis of

which we measure the satisfaction level of customers in terms of sales

services. These are the five most important CSI factors.

• Service Advisers

• Service Performance

• Facility Appearance

• Service Timings

• Problem Experienced

USE OF CSI

Absolute performance in the CSI is useful to gauge where we make

stands in relation to the competition. However tracking performance

from year to year should also be taking into account that gain or decline

in the performance relatively to the industry.

 Numbers of repair problems is the most heavily weighted attribute

in the CSI.

 Ability to fix the problem in the first time.

 Ease of getting appointments.

 Vehicle ready at promised time, now a day most expected service.

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 HARPREET FORD

NEW TRENDS IN CSI

 Informed when vehicle would be ready.

 Service department open at late hours and at weekends.

 Value added services until last year but now it becomes expected

services.

 Contacted after service and repairs, work order provided before

work begins and informed when service is completed.

TOTAL CUSTOMER SATISFACTION

Whether the buyer is satisfied after purchase depends on the

offer’s performance in relation to the buyers expectations. In general,

satisfaction is a person’s feeling of pleasure or disappointment resulting

from comparing a products perceived performance (outcome) in relation

to his or her expectations. If the performance falls short of expectations,

the customer is dissatisfied. If the performance matches the expectation

the customer is satisfied. If the performance exceeds expectations, the

customer is highly satisfied or delighted.

58