LNI-Adcal Auto Parts Sdn. Bhd. a Case Study
This case was about an automotive parts manufacturing company which experienced some difficulties in sustaining profitability i n its business operation. It had struggled through the early years to establish its name in the local automotive industry. The struggle was thought to be over when the t...
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| Main Author: | |
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| Format: | Project Paper Report |
| Language: | English English |
| Published: |
1997
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| Subjects: | |
| Online Access: | http://psasir.upm.edu.my/id/eprint/8086/1/GSM_1997_38_.pdf http://psasir.upm.edu.my/id/eprint/8086/ |
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| Summary: | This case was about an automotive parts manufacturing company which
experienced some difficulties in sustaining profitability i n its business operation.
It had struggled through the early years to establish its name in the local
automotive industry. The struggle was thought to be over when the turnover
achieved the highest level in 1996. However, it was not so because the
profitability had declined significantly.
The price competition in the industry was intense particularly so in the OEM
market. The problems were traced back to the annual price reduction exercises
conducted by local automotive assemblers. Every year, the price reduction
exercise was becoming severe and realised it has some difficulties in
maintaining its competitiveness in the industry. The management believed that
one of the solutions was to increase sales and at the same time, produced
quality products which could lead to improved profit margins. Hence, there
ought to be continuous improvement in the quality of the products through
efficient use of the production facilities. As in the past years, the company did
experience some quality problems in production and these incidences were
gradually minimised with the introduction of quality measures and the
replacement with new machines and equipment. Higher sales could be
achieved through market expansion in domestic and regional markets. The
management of LNI-Adcal Auto Parts has the first taste of export to the
Philippines. Finally, the company hoped that through export, it could achieve
the desired profitability and increased turnover. |
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