Strategic Management D4

Strategic Management D4

Ford motor company is committed to conserving the environment through various means in its product manufacturing. The company’s commitment to environmental conservation is mainly based on the reduction of carbon dioxide emission into the atmosphere. The company is committed to reducing carbon dioxide concentrations  at 450 parts per million (ppm) (Ford Corporation, 2013). This is the level that experts believe would reduce serious negative effects of  carbon dioxide in the atmosphere (Bradely, 2013). To consolidate the company’s commitment to the environment, the company has several principles that guide its operations. The first principle state  that every subsequent vehicle will be the best in fuel utilization. The second principle states that the company will reduce carbon dioxide from its global portfolio in an effort to stabilize the climate. The third and the final principle upon which the company’s commitment to the environment is based relates to carbon dioxide emission reduction at its facilities. The principle states that the company will reduce its carbon dioxide emissions by 30% between 2010 and 2025. Moreover, the company is committed to reducing the energy consumed by each vehicle by 25% between 2011 and 2016 in all its global operations.

The company has made several steps in demonstrating its focus on environmental conservation. The company has taken a step to reduce  carbon dioxide emissions in fleet average by 15% in all the US new vehicles between 2007 and 2012. Secondly, the company has reduced the carbon dioxide emissions on fleet average by 14%  of all its European vehicles  between 2006 and 2012. In 2012, the company started selling the Focus Electric vehicle, which was the most fuel efficient vehicle  at the time. The company was able to implement three extra engines using its EcoBoost fuel saving technology last year. The organization expects to be producing 1.5 million such engines on a global scale, which surpasses its original target by 200, 000. These steps clearly show that the company has made tremendous progress in its environmental conservation effort. When such steps have been highlighted, there is a high possibility that the company will achieve the other commitments in the future.

Although the company’s commitment to carbon dioxide reduction  is higher compared to other parts of the world, its commitments are universal. The universality of these commitments can be seen in its principles regarding the carbon reduction. The principles outline the company’s strategy for reducing carbon dioxide emissions in America and other parts of  the world.

In my opinion, the new tough environmental laws will have serious negative impact on the profitability of auto companies. The new laws that expect more fuel efficient vehicles will lead to the manufacture of more electric cars. The innovation and new development required to meet the regulations will increase the cost of production (Speth and Haas, 2006). Consequently, the cost of vehicles might go up, which may reduce affordability and reduce profits for automakers. The sales are also likely to reduce because low income earners mmay not afford to purchase vehicles because of the increased prices. On  the positive side, money will be saved from reduced fuel usage.

The majority of the automakers in the united states has agreed with the new regulations regarding the environment and fuel efficiency. Although the rules may reduce profitability, the companies have embraced them.  It is likely that the automakers agreed with the new regulations because of the recent government bailouts.

The General Motors is another auto maker from the United States, committed to environmental conservation. The company’s environmental conservation policies are based on recycling, reducing wastage, reusing materials and using landfill free facilities. Its approach to environmental conservation is based on reducing over-exploitation of resources by maximizing on  the available resources. Recycling reduces the amount of wastes to the environment while reusing maximizes the potential resources (Heck and Farrauto, 2005). Using landfill free facilities ensures that waste products do not pile up to destructive levels. The company manages to pursue environmental conservation issues through  new technological innovations.

Toyota is a multinational automaker from Japan. The company is famous for its fuel efficiency and diversity in its products. The environmental issues in japan that affect automakers such as Toyota are similar to those in the united states. One of the challenges that face the automakers is the regulations regarding environmental degradation by greenhouse gases (Toyota Corporation, 2013). The Japanese government collaborates with the Japanese Automobile Manufactures’ Association to enforce the laws. The collaboration between the government and the alliance is a different aspect that is not found in the united states. The government enforces the regulations in the united states, although automobile manufacturers are involved in the making of the laws. The united states environmental laws are stronger than Japanese environmental laws because the government enforces them solely without involving the automobile manufacturers. Toyota’s manufacturing line is among the best in the industry. The company has made steps in manufacturing alternative fuel driven cars and has implemented lean production mechanisms to ensure efficient vehicle production.

 

References

Bradely, J. (2013). Global change and local places estimating, understanding, and reducing greenhouse gases. Cambridge, UK: Cambridge University Press.

Ford Corporation. (2013).  Climate changes and the environment. Retrieved from http://corporate.ford.com/microsites/sustainability-report-2012-13/environment-climate

Heck, R. M., & Farrauto, R. J. (2005). Catalytic air pollution control: commercial technology. New York: Van Nostrand Reinhold.

Speth, J. G., & Haas, P. M. (2006). Global environmental governance. Washington: Island Press.

Toyota Corporation. (2013). Toyota + eco-efficient operations. Retrieved from http://www.toyota.com/about/environment/eco-efficient_operations/index.html

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