Level 3 – Stay on top

Level 3 (Automotive – subscribers)

Levels 2 to 4 of the game are only accessible to subscribers.

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Score to beat on February 23, 2019: 12,827

You played the first two sessions in two very different worlds (Internet and bakeries) but with some similarities: they were service professions with three competitors of similar size and whose aim was to conquer geographical territories (international or national). Did you manage to succeed? Congratulations!

 

We are now moving to a new economic sector.

The challenge now is about an industrial section, a very large global industry, the automotive one. So there is now a product size. However, the geographical dimension remains important because, in view of the latest developments in American policy, it is wise to plan for a return to a certain regionalisation.

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Moreover, this mechanical industry is the place of a transformation where electric motors are taking an important part in comparison to traditional thermal motor technology. The share of electricity is still small but growing rapidly and it is not excluded that in the long term it may take over at least half of the industry. Don’t forget the course on substitutions (chapitre 4) !

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This section is a mixed geographical and technological section, with:

• Three main areas: Europe in the broad sense, the Americas and Asia, including the rest of the world by simplification.
• Two technologies: the thermal engines and the electric motors.

By combining the two, this makes six strategic segments.

 

.Stay on top – 2018 assets of the five competitors

(companies and fictitious data)

 

The game is more complex than bakeries because there are now five competitors instead of three. You’re going to play the role of Noret, one of the four industry leaders. At the beginning of the game, four players have roughly the same global volumes: one American, one Japanese, two Europeans including your company. The fifth actor, Latesun, is only present at the start of the game in electric motors.

 

To finance your new investments, you can count on your ability to self-finance an on the debt leverage. You can also disinvest from some slots to invest in others.

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As in real life, you will have to to monitor over and undercapacity of the industry. Obviously, the fundamental element explaining profitability, it’s market share, but when there’s a very large overcapacity, profitability is reduced (symmetry is true in case of undercapacity) ; you will have to monitor the situation very carefully by giving a close look at the graphs in which you will find all the data.

 

.Stay on top – 2018 Noret Board of Directors
(companies and fictitious data)

 

The strategy for you is to gain market share in traditional technology segments and, at the same time, to take a significant share in the new segments of electric motor vehicles. This is the condition for survival and long-term prosperity.

And now, play on.

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