Mature Industry It is paramount to recognize that the automotive industry is mature and until recently, a few large players cornered the market with their products while potential competitors stayed on the sidelines discouraged by its high entry barriers. However, Eric Lawrence from the USA Today (2018) reported that Ford's new CEO wants to change the company broad market strategy that includes passenger car manufacturing to one focusing on building more trucks and sport
FORD 7 utility vehicles. This strategy can seem like a reasonable play as consumers preference in Ford's largest markets shits towards these vehicle types (Lawrence, 2018). The problem with this new approach includes several elements. First, new passenger car sales are once again increasing in the US. and abroad (Figure 1). Second, electric vehicle sales, especially passenger cars, are also increasing (Figure 2). Although, it is also accurate that electrified automobile production represents a small percent of the automotive industry. Nonetheless, production increases are expected to continue. In fact, General Motors, Tesla, and few other competitors continue to release entry-level electric and semi-autonomous vehicles that fill Ford's market void (DeBord, 2018). Essentially, Ford's approach appears to be a reactive decision to along game (Wheelen, Hunger, Hoffman, & Bamford, 2014, p. 24). The takeaway here is that while Ford abandons a market that can't control, the void is being filled by its primary competitors, and it’s also opening the door for new competitors.