Massey A7
CASE STUDY
MASSEY-FERGUSON 1980
Group A7:
• Elisenda Sumarroca
• Martin Von Vopelius
• Finn Pilath
• Dimitris Sotiriou
• Lorenzo Masserini
• Ilia Antipov
Q1: DESCRIBE THE INDUSTRY AND THE
KEY FACTORS TO BE SUCCESSFUL
Industry
• Competition between large multinational companies with a large portfolio of products and medium to small companies with a limited range of products.
• Main companies in North America: Deere & Co, Massey-Fergusson and
International Harvester.
• Increasing importance of Diesel engines with the rising gasoline prices which has caused more R&D in this field.
• Decline in demand in North America due to high interest rates, economic recession, soviet grain embargo and severe drought. This recession has also caused European and Third World Markets depression.
• Bad financial position of all farm manufacturers (e.g. International
Harvester is negotiating a refinancing plan).
Key Factors:
•
Technology and R&D investment in order to be able to develop new products (e.g. increasing importance of
Diesel industry).
•
To have economies of scale in production to be able to reduce costs
•
Products adapted to the local taste and requirements
(e.g. difficulties for Massey to be successful in North
America due to its portfolio of products).
•
Offer financing services to distributors and retail buyers.
Q2: PRODUCT MARKET
STRATEGY
•
1970s years of dramatic growth financed by debt
•
Strength in less developed countries outside North America and
Western Europe
•
Very successful before 1976 (exhibit 4) for several reasons
•
Focus on future growth markets with almost no competition
•
Diversified against political and other risks
•
Growth and World Market Share
•
Focus on third world while competitors were focusing on North
America
•
Located production facilities in developed countries (Canada, UK)
•
Pioneered new markets in developing countries unlike competitors
• Rough regional alignment of production and Sales (North
America and UK
MASSEY-FERGUSON 1980
Group A7:
• Elisenda Sumarroca
• Martin Von Vopelius
• Finn Pilath
• Dimitris Sotiriou
• Lorenzo Masserini
• Ilia Antipov
Q1: DESCRIBE THE INDUSTRY AND THE
KEY FACTORS TO BE SUCCESSFUL
Industry
• Competition between large multinational companies with a large portfolio of products and medium to small companies with a limited range of products.
• Main companies in North America: Deere & Co, Massey-Fergusson and
International Harvester.
• Increasing importance of Diesel engines with the rising gasoline prices which has caused more R&D in this field.
• Decline in demand in North America due to high interest rates, economic recession, soviet grain embargo and severe drought. This recession has also caused European and Third World Markets depression.
• Bad financial position of all farm manufacturers (e.g. International
Harvester is negotiating a refinancing plan).
Key Factors:
•
Technology and R&D investment in order to be able to develop new products (e.g. increasing importance of
Diesel industry).
•
To have economies of scale in production to be able to reduce costs
•
Products adapted to the local taste and requirements
(e.g. difficulties for Massey to be successful in North
America due to its portfolio of products).
•
Offer financing services to distributors and retail buyers.
Q2: PRODUCT MARKET
STRATEGY
•
1970s years of dramatic growth financed by debt
•
Strength in less developed countries outside North America and
Western Europe
•
Very successful before 1976 (exhibit 4) for several reasons
•
Focus on future growth markets with almost no competition
•
Diversified against political and other risks
•
Growth and World Market Share
•
Focus on third world while competitors were focusing on North
America
•
Located production facilities in developed countries (Canada, UK)
•
Pioneered new markets in developing countries unlike competitors
• Rough regional alignment of production and Sales (North
America and UK