1、Industrial goods & AutomobileChloe 2014.02未經(jīng)CareerVenture許可，任何個人或機構(gòu)不得用于商業(yè)目的Industrial goods & Automobile2 Self introductionName: Chloe Employer: A.T. KearneyEducation: Fudan University Contact: Bain & CoPTARoland BergerSpring PTAL.E.K. ConsultingSummer associateCorning corporate Strategy internA. T.

2、 KearneyBusiness analyst2012.22012.42012.72013.22013.92 Self introductionName: Chloe3 ContentChemical & New materialAutoCase in pointSummary3 ContentChemical & New materiGeneral Definition of industrial goodsUsed in the production of other goods include resources used in the actual production proces

3、s.End user is not consumer Material SupplierIntermediate manufacturerAssemblerDistributor/RetailerEnd-userIndustrial productsConsumer productsGeneral Definition of industri5 Industrial Goods : The segmentation of industrial goodsSource: CareerVentureMarket entryDuel DiligenceOperation “To buy or to

4、make” Profitability5 Industrial Goods : The segmeIndustrial Goods : life cycle and Curve S6 Industrial Goods : life cycle 7 Industrial Goods : Industrial products profitability case general solutionSource: CareerVentureStrategyBatch AssemblersSweatshopsBulk processorsEquipment MakerGrowthOrganicMult

5、i-brand strategyDiversify revenueInorganicBolt-on acquisitionsInternational expansionProfitability Operational ExcellenceImprove operational efficiencyConsolidate industryPricingPremium pricing7 Industrial Goods : Industria8 Industrial Goods : The characteristics of industrial goodsSource: CareerVen

6、tureHeterogeneousHomogeneousPriceProductionPromotionPlacementTransparentSensitive to exterior environmentfright(FOB&CIF), exchange rate, tax, economy of scaleNon-transparentPremium qualityCustomized salesHigh-marginGenerally not confined to capacityAffected by regulation, price, downstream demandCap

7、acity may be the glass ceilingTechonology-drivenIncentives for dealersPrice reductionsynergyIncentives for dealersPrice reductionSynergy Incentives for clientsNew product launch Dealerhighly price-sensitiveE-commerceDistributor/AgentE-commerce8 Industrial Goods : The charaCase in point： Outsourcing

8、options in China(BCG 1st round)9 Case in point： Outsourcing opt10 Case in point： Outsourcing options in China(BCG 1st round)10 Case in point： Outsourcing 11 Case in point： Outsourcing options in China(BCG 1st round)Main questionKey Areas to exploreKey Areas to exploreRecommendationOther factorsShoul

9、d plastics manufacturer move production into China ?Cost savingConsumer behavior and purchase CriterionEffect on current production capabilitiesWould save $0.25 (25% of current cost)At current production level would save50M in freezer bag75M in plastics plates and utensils25M in specialty plates and

10、 utensilsQuality is top purchase criterion for freezer bagsLower quality from ChinaPrice is top criterion for plastic plates and utensilsStyle is top criterion for specialty plates and utensilsHighly variable demand requires short lead timeCurrent plant is at capacityOutsourcing would eliminate need

11、 to build additional capacityPlastics and utensils are 50% of total productionOutsourcing may create too much extra capacityOutsourcing plastic plates and utensils to ChinaDo not outsource specialty plates and utensilsDo not outsource freezer bags(although further analysis may be warranted)To compen

12、sate for extra capacity that would be created in current plant, could produce new product line, rent out spare capacity, or move to smaller facility11 Case in point： Outsourcing 12 ContentChemical & New materialAutoCase in pointSummary12 ContentChemical & New materGeneral segmentation of automobile

13、industry13 Chinas automobile industryPassenger VehiclePassenger BusCommercial VehicleSedan CarSUVMPVPremium (Vst2.6L)Middle to High (Vst2.3L)Middle (1.6LVst2.3L)Low (Vst10m)Medium (7mlength10m)Small (length14ton)Medium-duty truck (weight14ton)Light-duty truck (weight14ton)123General segmentation of

14、automoDynamics of consumer carsPremium Auto14 1High-end consumer cars are enjoying great growth potentials in China Current regulations boost high price in ChinaConsumption tax TariffsEnvironmental policyKSF of luxury carsAutomobile design/performanceDistribution channelBrand positioningKey informat

15、ion Example:Different product portfolio in different part of China Promote SUV Cayenne to business and family-type consumers Good service experienceExpanded sales distribution channelIncluding second, third-tier citiesDynamics of consumer carsPremDynamics of consumer carsMiddle end cars15 ReleaseFun

16、ForceVitalityAffirmationRespectDifferentiationSelf-EsteemControlSecurityTranquilitySocialopennessBelongingConfirmation2Dynamics of consumer carsMiddDynamics of commercial vehiclesTrucks16 3Heavy duty trucksLight duty trucksMarket dynamicsPossible growth strategyLight truck market is mainly focused o

17、n low-end market with excessive capacityMarket is highly consolidatedTop 4 players account for 85% share Fierce competition leads to low profitability levelHeavy-duty truck market is quite quality-drivenForeign brand holds dominant market placeMarket is highly consolidatedConsumers are less price-se

18、nsitiveProfit margin is high given hard quality standardMarketing the brand as high-quality, wearable vehicleIncrease penetration by establishing network with SOE-owned fleetsProvide good after-serviceIncrease penetration by using multi-channel strategyIncrease product portfolio to satisfy customers

19、 diversified needsSeek M&A opportunitiesDynamics of commercial vehicle17 Decision process of Commercial vehicles417 Decision process of Commerc18 Commercial vehicles demand drivers3Underlying industry activityPenetration & SubstitutionRequired installed baseNew demandReplace-ment demandReplace-ment

20、circleActual installed baseFleet UtilizationAnnual salesDriversInstalledBaseAnnual SalesLegendUnderlying industry activity (e.g., coal output or construction volume) is the key primary driver in determining capacity needs and hence expansion demand. It is also correlated with utilization of the exis

21、ting fleet which in turn drives wear and tearIn a market with accelerating underlying industry growth, utilization picks up, and more intensive use of trucks leads to trucks being replaced fasterDecelerating growth in the underlying industries decreases utilization of existing fleets, which allows t

22、rucks to be used longer before they need to be replaced, and extends the payback period of fleet ownersComments18 Commercial vehicles demand Case in point： European Hydraulic Cylinder 19 Our client is the biggest manufacturer of auto parts manufacturer, which is an important and indispensable elemen

23、t of dump truck. Our client now face a problem of shrinking market share and it now hired us to investigate reasons and come up with strategies.CompetitorCustomerCompanyMarketThree big local players withLower priceRelatively Lower but improving qualityGrowing market shareThe largest competitor has r

24、eally good relationship with major OEMsTheres a trend of body builder to have in-house hydraulic cylinder facilitiesMajor Customers are body builders, OEMsAll parties in supply chain have a saying in the purchasing decisionCustomers choice can be influenced by salespersonTruck users are infrastructu

25、res, coal mines and other minesBrand recognition varies differently across different regionEnd users are very scattered and price-sensitivePrice are 20% higher than competitorsUsed to be the market leader, with the most quality products and brand equityFailed to provide specific products which meets

26、 current customers needDo not have very good relationship with major body buildersBetter quality and better after-serviceMarket are shrinking becauseUtilization is lowerInfrastructure segmentation is growing stronglyCase in point： European Hydrau20 Case in point： European Hydraulic CylinderCase road map CapabilityMarketCustomerCompetitorArea to probeProblemUnderlying market potentialRoad transportationInfrastructureCoal mineImplication of market trendUtilizationReplacement cycleWho is the c