MBA 631
OPERATIONS MANAGEMENT
INDUSTRY OVERVIEW

GLOBAL 500 - INDUSTRIAL AND FARM EQUIPMENT
     
Industry: Industrial & Farm Equipment  
       

Rank

Company

Global 500 Revenues Rank

Revenues

Profits

Profits as % of

$ millions

% Change From 1999

$ millions

% Change From 1999

Revenues %

Assets %

 
       

1

Thyssen Krupp

104

35,948

10

509

73

1

2

 
       

2

Mitsubishi Heavy Industries

158

27,540

7

-184

N/A

-1

-1

 
       

3

Alstom

208

22,291

33

185

-49

1

1

 
       

4

Caterpillar

240

20,175

2

1,053

11

5

4

 
       

5

Deere

394

13,137

12

486

103

4

2

 
       

6

Invensys

450

11,632

-20

115

N/A

1

1

 
       

TOTAL

--

--

130,724

--

2,164

 

 

 

 
                           
Industry Player Competitive Strategy and Analysis
 

   

How do you say "giant engineering and steel company" in German? Try "ThyssenKrupp." The company -- a product of a 1999 merger between Thyssen AG, (pronounced "TISS-in") and Fried. Krupp AG Hoesch-Krupp -- is one of the largest steel producers in the world. ThyssenKrupp operates worldwide through eight business units: steel (carbon steel and stainless steel), elevators, technology (machine tools), components (large-diameter bearings, garage doors, industrial doors), materials (tailor-made materials), services (environmental services, mechanical engineering, and scaffolding services), real estate, and another catch-all unit that houses businesses such as its shipbuilding operations.
   
 

Fiscal Year-End: September

2001 Sales (mil.): $34,572
1-Yr. Sales Growth: 5.7%

2001 Net Inc. (mil.): $605
1-Yr. Net Inc. Growth: 30.6%

2001 Employees: 193,516
1-Yr. Employee Growth: 0.1%

Top Competitors
Corus Group
Nippon Steel
United Technologies
   
Thanks to its diverse portfolio of manufacturing and service businesses, Mitsubishi Heavy Industries (MHI) is sailing more or less smoothly through Japan's rough economic seas. MHI, a member of the Mitsubishi keiretsu, manufactures machinery and equipment ranging from forklifts to air conditioners. It also builds water and waste treatment plants and steel factories. Machinery and construction together account for about 40% of MHI's sales. The company also builds nuclear power plants (29% of sales); manufactures aircraft, missiles, and space systems (17% of sales); and builds cruise ships, freighters, tankers, and offshore marine structures. MHI has operations worldwide; Japan accounts for more than 90% of its sales.
   
 

Fiscal Year-End: March

2001 Sales (mil.): $24,104
1-Yr. Sales Growth: (11.5%)

2001 Net Inc. (mil.): ($161)
1-Yr. Net Inc. Growth: --

Top Competitors
Ishikawajima-Harima
Kawasaki Heavy Industries
   

ALSTOM is one of the world's top three suppliers of power generation services and equipment and has a unique position as a full-service provider to the industry. Offering a complete range of services, components and turnkey power plants, the Company has supplied the equivalent of 20% of the world's total installed power generation capacity.

Highlights of our Customer Service Capabilities

  • Complete portfolio of services from spare parts and field services to full operation and maintenance packages
  • Refurbishment and modernization of existing plants
  • Technical consulting services
  • Services for all existing technologies for all power plants using all fuel types
  • Service to our own fleet installed worldwide
  • Service solutions for many third party technologies
  • Power plant management
  • Power service alliances
  • Tailor-made service solutions for customers around the world
Following the sale of its contracting activity on 20/07/01, ALSTOM has annual sales in excess of 22 billion euros and employs 120,000 people in over 70 countries. In energy, ALSTOM is active in power generation, power transmission & distribution and power conversion; and in transport through its activities in rail and marine.

ALSTOM offers its customers a complete range of innovative components, systems and services covering design and manufacture as well as commissioning and long-term maintenance and has unique expertise in systems integration, management of turnkey projects, and application of advanced technologies.

The Company is listed on the Paris, London and New York stock exchanges
   

Building more than cocoons, Caterpillar has become a leading supplier of agricultural equipment and the world's #1 maker of earthmoving machinery. The company also makes a variety of construction, mining, and logging machinery, as well as engines for trucks, locomotives, and boats, and electrical power-generation systems. Caterpillar also provides financing and insurance for its dealers and customers. The company operates manufacturing plants on six continents and sells its equipment worldwide via a network of some 220 dealers (in about 2,700 locations). Taking advantage of a vast distribution network, it sells its own line of Cat-branded products, such as boots, as well as other items manufactured by third parties.
   

Fiscal Year-End: December

2001 Sales (mil.): $20,450
1-Yr. Sales Growth: 1.4%

2001 Net Inc. (mil.): $805
1-Yr. Net Inc. Growth: (23.6%)

2000 Employees: 68,440
1-Yr. Employee Growth: 2.3%

Top Competitors
CNH Global - US
Cummins - US

 

 
   
Deere & Company's customers go to seed -- at least once a year. The company is one of the world's two largest makers of farm equipment (CNH Global is the other). Deere also is a leading producer of industrial, forestry, and lawn-care equipment. Its farm equipment includes tractors, tillers, harvesting machinery, and soil-preparation machinery. Deere's construction equipment includes backhoes and excavators. Deere also makes drivetrain components, diesel engines, chain saws, leaf and snowblowers. Farm equipment accounts for more than 45% of sales; Canada and the US account for more than 75% of sales. The company has sold its Homelite consumer products division and is consolidating operations and cutting jobs.
   
 

Fiscal Year-End: October

2001 Sales (mil.): $13,108
1-Yr. Sales Growth: 1.1%

2001 Net Inc. (mil.): ($64)
1-Yr. Net Inc. Growth: --

2001 Employees: 45,100
1-Yr. Employee Growth: 3.2%

Top Competitors
Caterpillar - US
CNH Global - US
Kubota
   

Engineering group Invensys is in control of its market. The company -- which was formed when Siebe (controls, UK) bought larger diversified industrial manufacturer BTR (UK) -- makes thousands of control and industrial products, from simple stove-top knobs to industrial automation systems. It also makes semiconductor surge-protection devices, factory control and specialty engineering equipment, air compressors, and safety shutdown systems. With Microsoft, Invensys is developing Internet standards for appliances. To stay profitable through a period of acquisitions that included the purchase of Dutch enterprise software maker Baan, Invensys is divesting noncore operations and spinning off its power systems unit.
   
 

Fiscal Year-End: March

2001 Sales (mil.): $11,136
1-Yr. Sales Growth: (22.6%)

2001 Net Inc. (mil.): $110
1-Yr. Net Inc. Growth: --

2001 Employees: 90,650 (est.)
1-Yr. Employee Growth: (25.5%) (est.)

Top Competitors
ABB
GE Industrial
Honeywell International
 
Caterpillar's "Non-Global 500" Competition
 
 

Cummins Online
 

Those big rigs are Cummins 'round the bend. Cummins (formerly Cummins Engine Company) is the world's leader in the manufacture of large diesel engines. The company's engines also power school buses, medium-duty trucks, pickup trucks (primarily the Dodge Ram), and equipment for mining and construction. Cummins claims about one-third of the North American market for heavy-duty truck engines. Power generation products such as its Onan generator sets and Newage alternators account for about 20% of sales. Cummins' Fleetguard and Nelson filtration subsidiaries produce fuel filters and air filters for heavy-duty engines.
 
 

CNH Global Online
 

CNH Global (formerly New Holland) is getting over a case of consolidation fever. Having doubled in size after acquiring US-based rival Case Corporation, it is one of the world's two largest makers of agricultural equipment (Deere & Company is the other) and the #3 maker of construction equipment (trailing Caterpillar and Komatsu). With plants in 17 countries, CNH Global sells through about 12,000 dealers and distributors worldwide. Its farm equipment includes tractors, harvesters, and hay balers; light-industrial and construction offerings include backhoes and miniloaders. CNH Global is in the process of reducing its workforce by 25% by 2003. Italian carmaker Fiat owns 84.5% of the company.
 
 

Komatsu Ltd. Online
 
Komatsu is a mover in a shaky Asian economy. The world's #2 maker of construction equipment (behind Caterpillar), Komatsu makes excavators, bulldozers, dump trucks, and cranes used for building and mining operations. Such equipment generates almost 70% of the company's sales. Komatsu also makes electronic equipment (excimer lasers, vision systems) and industrial equipment (press brakes, machine tools), as well as prefabricated housing, armored vehicles, ammunition, and computer software. Additionally, the company provides civil engineering, financial, and real-estate services. Japan accounts for about half of Komatsu's sales; the company has been hampered by low demand for construction equipment in Asia.
 
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