CEMEX Case Essay Essay
1. Explain the benefits that CEMEX and the other planetary rivals in cement have derived from globalisation – how can cross-border activities add value in an industry as seemingly localized as cement? CEMEX had merely exported cement to the United States in low monetary values than Mexico. After clip goes by. The United States’ manufacturers had banded together to lodge an antidumping request to protect their industry from Mexico’s dumping monetary values. After all. the U. S. International Trade Commission ( ITC ) imposed a offseting responsibility on CEMEX’s exports from Mexico to the United States. After that. CEMEX started to concentrate on globalisation particularly Foreign Direct Investment ( FDI ) . So they acquired The United States’ cement works in Texas. This was the start to concentrate on cross-border activities. And it has given many benefits to them. The one of the grounds was avoiding traffic barriers. On the other side. CEMEX and the other planetary rivals are managing cement which is bulky and heavy. So one of the large concerns is transit cost. If they export the cement. they should pay tremendous transit costs.
And it besides should be involved in cost which is paid by client. Therefore. they will lose their monetary value fight or border by cut downing the cost. So cut downing the transit costs is the 1 of the grounds to make FDI. They could besides salvage the clip to present by puting the workss in each state. Particularly in instance of the CEMEX. they’re even utilizing orbiters to associate starters. teamsters. and clients in a system so that using bringing system. So they guarantee bringing within 20 proceedingss every bit good. This is besides the ground they do FDI. And another 1. Cement industry is really sensitive to GDP growing. involvement rates. and other macroeconomic factors. and etcetera. They’re non merely concentrating on their place state. but besides making FDI to cut down the hazards by variegation to acquire stable grosss as good. The last 1 is that cement workss have to be closed to countries where there is limestone. And it is hard to happen suited topographic point for limestone and concept workss particularly in foreign state by Greenfield investing which is everything new. So it is easier to happen that topographic point by geting cement workss.
And it besides gives benefits on distribution channel which is already organized by formers. What recommendations would you do to CEMEX sing its globalisation scheme traveling frontward? In peculiar. what kinds of states should it concentrate its future enlargement on? CEMEX has expanded a cement concern to the United States. Spain. Latin America. and other parts in the text. They besides had its eyes on China. India. and Brazil. The FDI scheme is supposed to be good for CEMEX because of the cement’s forte that we’ve already told before. And they have acquired RMC which is located on the United Kingdom and 3rd largest cement industry in Europe in 2005. and Rinker group located on Australia which is acquiring gross revenues of 80 % at the United States so far from on the cyberspace. CEMEX has dependable constructs about enlargement procedures. Most impressive thing is a state had to hold a big population and high population growing.
Even without that construct. China. India. and Brazil are supposed to be tremendous market every bit good and so does our squad. But They Haven’t invested yet and they have merged English company. So we’ve suspected that it’s supposed to be large concern that linguistic communication jobs about Chinese and Indian. Mexico people use Spanish and CEMEX may besides utilize English internationally. And they’ve merged many company based upon Spanish and English speech production state. We don’t cognize about interior idea of CEMEX. but it’s supposed that they’re concentrating the linguistic communication every bit much as population and population growing as the text says. and they’re non focusing political hazards because they’ve already invested many states that have political hazards including Mexico. So in those thoughts. our squad decision is that CEMEX’s chief mark is the company based upon English and Spanish speech production state sing population every bit good. The specific state is Brazil. Brazil has already mentioned in the text.
That country’s population is about 191 1000000s. And even though Brazil’s female parent lingua is local Portugal. many people study Spanish and English presents. But it’s excessively plenty. If they’ve satisfied with meeting that sorts of company which is mentioned before. they should concentrate China and India market the following. They should engage Chinese and Indian people who can talk English to acquire into the China and India market. That can work out the linguistic communication job. And they’ve already had a company located in Australia. There’re many Chinese and Indian who can talk English really good in Australia because Australia is celebrated for multiracial state. By making it. they can afford to acquire into Chinese and Indian market. Of class they should see other concerns.
And the other topographic point is Middle East that many Korean building companies have already participated in. There have much political hazards even though take topographic point some wars but demands for building is really high. Dubai and United Arab Emirates for case. So The last suggestion of us is Middle East.
2. What accounts for the sequence in which CEMEX entered foreign markets? How do the markets CEMEX entered more late compare with the markets it entered early on?
3. What recommendations would you do to CEMEX sing its globalisation scheme traveling frontward? In peculiar. what sort of states should it concentrate its future enlargement on and why? CEMEX enlargement is a procedure where the company performs its due diligence and the purpose of spread outing into a state with a big population and high population growing. I thought CEMEX should go on to concentrate on Asiatic and Africa market. These two countries can assist CEMEX go stronger than earlier. Expecially three states: CHINA. INDIA and brazil