BUSS 4 RESEARCH THEME- CHINA

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ADVANTAGES- JOINT VENTURES

ADVANTAGES - JOINT VENTURES

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TESCO JOINT VENTURE WITH CRE

  • Tesco operated in china for 9 years and reported a loss in ech of the 9 years
  • This was due to clubcard idea not being succesful
  • Joint venture to gain local knowledge
  • Tesco will have a 20% stake
  • CRE have a brand to create a business with sales approaching $10 billion.
  • 20% stake can earn around $20 billion annually
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Renault and Dongfeng

  • Worth 7.76 billion yuan ($1.27bn; £778m)
  • Dongfeng motor group second largest in china
  • Plans to build 150,000 vehicles and engines a year
  • China is the largest car market
  • 50-50 joint venture will be called Dongfeng Renault Automotive Co Ltd
  • Vehicle sales rising by 4.3% in 2012 to 19.3m
  • Under Chinese trade laws, foreign carmakers looking to launch manufacturing operations in China must have a local partner
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