Renault Essay Sample

1. What are the complexnesss involved in factoring out the consequence of imposts and responsibilities in planing the supply web of Logan ( i. e. . where to construct the CKD parts and CBU. and what markets to function from what sites ) ? Should Renault construct all CKDs in Romania. or should they beginning CKDs locally? Renault had to take many factors into consideration when planing the supply web of Logan. They could export the auto as a wholly built-up vehicle ( CBU ) . which would let all production and assembly to be centralized but would be faced with inordinate import responsibilities. An option was to export the Logan as wholly knocked down units ( CKDs ) . the definition of which varied by state. They could besides buy from local providers alternatively of utilizing CKDs from Romania. If Renault was selling a high volume in a peculiar state. it may do the most sense to utilize local providers since their fight was found to increase with volume. Renault would necessitate to see logistics involved in transporting CKDs from Romania. For illustration. even if a portion could be imported with no duties. the logistics of acquiring the portion there may be more than utilizing a domestic seller or another site.

2. In general. what are the quantifiable and non-quantifiable factors that one should see in planing a supply web? The factors that should be considered in planing a supply web include degrees of local assembly contents. certification demands. economic factors. governments. duties. and trade understandings. They should besides see currency exchange rates. rising prices of local currency. and other economic factors in each local market.

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3. For Logan. what new chances were created by Romania come ining the European Union in 2007? Renault saw Romania as the perfect female parent site to provide parts for the Logan both domestically and for other workss in “Russia. Morocco. Colombia. and Iran” . When Romania entered the European Union in 2007 they became able to import parts from many different states due to free trade understandings. Another new chance created is that Rumanian parts were now considered “European” and could hence be counted as “local contents” when imported into member states. This was specifically utile on imports from Morocco to Europe.

4. One of the benefits of Renault’s confederation with Nissan was purportedly the possible created by Renault utilizing more of Nissan’s parts in their merchandises. What are the factors that you would see in finding whether a Nissan portion should be designed into the Logan? I would see if it was cost effectual to utilize Nissan parts while non giving anything from the design of the auto. If Renault needed a specific portion. it would be a waste of resources to develop a new one if Nissan had an indistinguishable portion that would work the same manner that they could utilize. They would hold to be careful non to get down rebadging Nissan’s with a Renault badge though since consumers will see through this. That is one of the jobs that lead to GM’s fiscal issues a twosome old ages ago. GM would seek to sell the same exact auto under 5 different trade names which became known as “badge engineering” . The Logan used some parts from the same platform used for the Nissan Micra and Renault Modus.

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5. The outgrowth of the South African market offers an chance for Renault to construct CBUs in South Africa. Renault was sing South Africa as an export hub but the state had non been successful in set uping free trade understandings for vehicles. South Africa besides had the Motor Industry Development Programme ( MIDP ) . to “increase the fight of the automotive industry in the South African Customs Union ( SACU ) . by bit by bit diminishing the import responsibility rates on CBUs and CKD parts” . They besides had a “Duty Free Allowance ( DFA ) ” . which allowed companies to import “27 per centum of the sweeping value of the vehicle” duty-free. South Africa encouraged companies to do investings in programs and equipment through the Productive Asset Allowance ( PAA ) . which allowed them to have responsibility free recognition certifications for up to 20 % of the value of their investing.