Vertical and horizontal integration strategy Assignment

Vertical and horizontal integration strategy - Assignment Example t the end of this integration is the factory plant at River Rouge, Michigan where all these parts are assembled to become an automobile that will be later distributed in the market and sold. For a time, this strategy became very effective and contributed to Ford’s success. This strategy of vertical integration however eventually became obsolete as supply chain became complex and competition became stiffer. The introduction of new supply chain and inventory control such as Toyota’s Just-in-Time rendered vertical integration out of fashion. The recent recessions also exposed the vulnerability of vertical integration to economic and cyclical downturns. Thus, the strategy evolved to horizontal integration which is more appropriate for its global market. Horizontal integration as a strategy involves the acquisition of the production whose products are the same – either complementary or competitive (www.theeconomist.com, 2009). The classic example of this strategy is buying competitors who sell the same product. In the case of Ford this is the acquisition of Lincoln, Mercury, Mazda, Jaguar, Land rover, Volvo and Aston Martin which was sold as an option of the company’s