Erstaunliche AutosRefinancing projectR.Gringhuis & M.Pit
Tompkins and Kosters
Content overview
Current situation analysis
Major issues
Recommendation package
Implementation
Difficulties Conclusion
Current situation at EA
Medium sized car manufacturer
Base of operations: Frankfurt
Workweek: four days Salary rates average: 140% of competitors
salary rates
Analysis of major issues
Work days + salaries Fierce competition by Chinese
Recommendation package
Boost profits by 4bn, period of 3 years Save 7bn over 3
years
Savings2 bn 5 bn
Run campaign to improve sales Cost cutting measures
Improve overall plant productivity
5 days workweek Opportunities for 6th day, 150% wage
Negotiate a decrease suppliers costs by 10%
Three year cost-cutting programmeSavings in improved sales; 2bn
Reducing suppliers' costs by 10%; 2bn
Others; 2bn
Savings f rom labour costs; 1bn
Recommendation package
Manufacturing centre productivity In *1000 cars per year300
250 EA Germany EA Belgium 150 Chinese car manufacturer Indian
car manufacturer
200
100
50
0 Productivity
Recommendation package
Establish new manufacturing plantDecrease costs Increase
productivity Increase competitiveness
Outsource production of non-essential components
Cut costs for parts, savings: 20-30%
Recommendation package
Reduce workforce in Belgian and German plants by 30%Redundancy
packages for senior worker >55Voluntary redundanciesAverage pay
rates per hour for assembly line workers50 45 40 35 30 25 20 15 10
5 0 Germany China Usa
Salary in $ per hour
Antwerp
Difficulty
Loss of image Ensure good quality! Advertising campaign
ConclusionAre there any questions?
