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Erstaunliche Autos

Analyzing the current situation at EA, a medium-sized car manufacturer based in Frankfurt, facing fierce competition from Chinese rivals. Recommendations include cost-cutting measures, productivity improvements, and establishing new manufacturing plants to increase competitiveness. Challenges include potential difficulties in workforce reduction and maintaining quality standards. In conclusion, a strategic three-year plan is proposed to enhance profitability and market position.

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Erstaunliche Autos

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  1. Erstaunliche Autos Refinancing project R.Gringhuis & M.Pit – Tompkins and Kosters

  2. Content overview • Currentsituation analysis • Major issues • Recommendation package • Difficulties • Conclusion

  3. Current situation at EA • Medium sizedcarmanufacturer • Base of operations: Frankfurt • Workweek: fourdays • Salaryratesaverage: 140% of competitors’ salaryrates

  4. Analysis of major issues • Work days + salaries • Fierce competition by Chinese

  5. Recommendation package • Boost profits by €4bn, period of 3 years • Save €7bn over 3 years Savings • Run campaign to improve sales - €2 bn • Cost cutting measures - €5 bn • Improve overall plant productivity • 5 days workweek • Opportunities for 6th day, 150% wage • Negotiate a decrease suppliers’ costs by 10%

  6. Three year cost-cutting programme

  7. Recommendation package • Manufacturing centre productivity In *1000 cars per year

  8. Recommendation package • Establish new manufacturing plant • Decrease costs • Increase productivity • Increase competitiveness • Outsource production of non-essential components • Cut costs for parts, savings: 20-30%

  9. Recommendation package • Reduce workforce in Belgian and German plants by 30% • Redundancy packages for senior worker >55 • Voluntary redundancies Average pay rates per hour for assembly line workers China Antwerp

  10. Difficulty • Loss of image • Ensure good quality! • Advertising campaign

  11. Conclusion Are there any questions?

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