This document provides a case analysis and recommendations for Bombardier regarding its options in dealing with subsidies provided to its competitor Embraer by the Brazilian government. It analyzes three options for Bombardier: 1) urging Canada to impose trade sanctions on Brazil, 2) negotiating directly with Brazil and Embraer, or 3) having Canada match Brazilian subsidies. It ultimately recommends the second option of restarting negotiations as posing the fewest risks in terms of costs and public opposition, while still allowing the other options if negotiations fail. The analysis draws on academic literature regarding international trade, political strategies, and subsidies to support this recommended course of action.
Challenges
Inaccurate forecasts of retailer demand has become a major issue at Obermeyer. The two major factors that made this task more difficult was the increase in product variety and intense competition in market. Second challenge the company had faced was to allocate production between Hong Kong and China. Although Obermeyer had 1/3 of Parka production in China for 1992, this year the organization insisted on increasing the sales to half. There was difference in quality and labor rate at China and Hong Kong which made allocation decision more difficult.
Another challenge the company faced was the larger lead time. The company had supplies of raw materials from various countries which resulted in delayed production time. Organization challenges along with competition from competitor companies were major challenges the company had faced.
Analysis
From the sales predictions that the six managers forecasted, a coefficient of variation (COV) was determined, which indicated the level of spread of the forecasted data. The COV values were broadly divided into two levels, the low risk group and the high risk group. Every value below 0.2 were considered to be among the lower risk items and all the items above COV value of 0.2 were considered to be of higher risks. Once the risk levels of each item were determined, the quantities of items to be produced in first and second production cycles could be calculated with least risk. 70% of the entire sales forecast for the lower risk items were ordered to be produced. Only 30% of higher risk items were ordered to be produced in the first production cycle. The quantities which amounted to 1200 were manufactured in China and that which were close to 600, were manufactured in Hong Kong in the first production cycle.
Once the 80% of the orders were received from the retailers from the Vegas show, a clear picture of the demand forecast could be obtained, according to which the rest of the items could be manufactured either in China or Hong Kong. Referring to exhibit 1, the four products to be produced in China in the first production cycle are: Assault, Seduced, Entice and Electra. These four products have COV less than 0.2. However Gail, Daphne, ISIS, Anita, Teri, Stephanie are produced in Hong Kong for the first production cycle as they have a high level of risk associated with it.
Conclusion
Short term operational changes
o Decrease lead time by obtaining raw materials from geographically closer locations to ensure timely delivery
Long term operational changes
o Cross scaling Chinese labors which would help the company produce quality and reliable goods at a cheaper price
House of Tata: Acquiring a Global FootprintAbhigyan Singh
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A marketing Case Study of Natureview Farm, an organic yogurt manufacturer. This analysis was performed by E. Santhosh Kumar, IIT Madras, during an internship with Prof. Sameer Mathur, IIM Lucknow.
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Broad analisis of the biggest company in the world. It includes WalMart history, internal and external analysis and a focus on WalMart's internationalization with some suggestions for the future.
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Challenges
Inaccurate forecasts of retailer demand has become a major issue at Obermeyer. The two major factors that made this task more difficult was the increase in product variety and intense competition in market. Second challenge the company had faced was to allocate production between Hong Kong and China. Although Obermeyer had 1/3 of Parka production in China for 1992, this year the organization insisted on increasing the sales to half. There was difference in quality and labor rate at China and Hong Kong which made allocation decision more difficult.
Another challenge the company faced was the larger lead time. The company had supplies of raw materials from various countries which resulted in delayed production time. Organization challenges along with competition from competitor companies were major challenges the company had faced.
Analysis
From the sales predictions that the six managers forecasted, a coefficient of variation (COV) was determined, which indicated the level of spread of the forecasted data. The COV values were broadly divided into two levels, the low risk group and the high risk group. Every value below 0.2 were considered to be among the lower risk items and all the items above COV value of 0.2 were considered to be of higher risks. Once the risk levels of each item were determined, the quantities of items to be produced in first and second production cycles could be calculated with least risk. 70% of the entire sales forecast for the lower risk items were ordered to be produced. Only 30% of higher risk items were ordered to be produced in the first production cycle. The quantities which amounted to 1200 were manufactured in China and that which were close to 600, were manufactured in Hong Kong in the first production cycle.
Once the 80% of the orders were received from the retailers from the Vegas show, a clear picture of the demand forecast could be obtained, according to which the rest of the items could be manufactured either in China or Hong Kong. Referring to exhibit 1, the four products to be produced in China in the first production cycle are: Assault, Seduced, Entice and Electra. These four products have COV less than 0.2. However Gail, Daphne, ISIS, Anita, Teri, Stephanie are produced in Hong Kong for the first production cycle as they have a high level of risk associated with it.
Conclusion
Short term operational changes
o Decrease lead time by obtaining raw materials from geographically closer locations to ensure timely delivery
Long term operational changes
o Cross scaling Chinese labors which would help the company produce quality and reliable goods at a cheaper price
House of Tata: Acquiring a Global FootprintAbhigyan Singh
The 134-year-old Tata Group with 95 operating companies (31 of them publicly traded) and 230,000 employees, it is India's largest private-sector employer, its biggest taxpayer, and its greatest foreign-exchange earner.
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As part of her analysis of Apple’s stock, she wanted to look at the company’s supply chain to see if she could gain some insight into the pros and cons of Apple as a key holding in BXE’s fund. When. Apple Computer was founded on April 1, 1976, by Steve Jobs, Steve Wozniak and Mike Markkula to manufacture and distribute desktop computers.
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There are four main types of pricing strategies from which Atlantic Computers canchoose. First, Atlantic Computers could stay with the status quo and offer software tools for free. Second, it could choose competitive based pricing. Third it could choose from Cost-plus pricing. Finally, it could choose value-in use pricing.In addition to determining which pricing strategy to use, Atlantic
Broad analisis of the biggest company in the world. It includes WalMart history, internal and external analysis and a focus on WalMart's internationalization with some suggestions for the future.
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The presentation explores how the Duopoly of Boeing & Airbus rules the Aircraft Manufacturing Market, The competitive Rivalry among these two companies, Porter's Five Forces acting on this industry
Global Operations and Supply Chain Management: Airbus vs. Boeing Final Assig...Jamar Johnson
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Our Business Philosophy, "to provide Distributors worldwide with quality products, education, and career opportunities, improve the quality of life, promoting international harmony" and to, bring happiness and wealth around the world. The basic concept of Horizons Beyond Dreams business is “Consumption Creates Wealth, Conducting Consumption Creates More Wealth”. Guided by the basics of “No Pain no Gain”, Horizons Beyond Dreams business paved a risk-free path for distributors
Hello people!
During my final year of my undergraduate degree at The University of Manchester, I was lucky enough to write an equity analyst report about how political risk can affect a company's value.
I hope you will enjoy reading this report!
InsightsPrimer The Trans Pacific PartnershipBY JACQUE.docxcarliotwaycave
Insights
Primer: The Trans Pacific
Partnership
BY JACQUELINE VARAS | NOVEMBER 16, 2015
Introduction
After years of negotiations and weeks of anticipation, the final text of the Trans-Pacific Partnership (TPP) has
been released.[1] TPP is a trade agreement between the United States, Japan, and ten other Pacific nations.
These countries represent 40 percent of the world’s Gross Domestic Product and, combined, would form the
largest free trade area ever created.[2]
Source: Forbes[3]
AMERICANACTIONFORUM.ORG
http://americanactionforum.org/experts/jacqueline-varas
The Trade Promotion Authority, passed earlier this year, established guidelines for the passage of trade deals
like TPP. These guidelines stipulate that an up or down vote from Congress cannot occur for at least 90 days
after the President notifies Congress of his intention to sign the agreement[4], which he did on November 5,
2015. This gives the public and Congress ample time to analyze its contents in detail and determine its
implications for the American economy.
Tariffs and Non-Tariff Barriers
The primary purpose of TPP is to eliminate barriers to trade. One such barrier, tariffs, drives up the cost of
foreign goods in order to encourage the sale of goods manufactured at home. These taxes on imports make
foreign goods and services more expensive, reducing trade and limiting competition. Expanding competition,
however, is generally thought to lower prices, incentivize innovation in manufacturing, and encourage the
creation of higher quality goods.
TPP eliminates or reduces all tariffs on goods traded between partner countries. Currently, tariffs imposed on
U.S. exports are as high as 100 percent on goods and 700 percent on agriculture products. The TPP agreement
would abolish many of these tariffs, translating into approximately 18,000 tax cuts on U.S. goods sold abroad.[5]
TPP also aims to increase trade in services. Services make up a substantial portion of U.S. trade, accounting for
$711 billion of exports in 2014.[6] TPP expands market access in this area by prohibiting quantity restrictions
on imported services, outlawing discrimination against foreign service providers, and encouraging the open
exchange of services in all sectors.[7]
Electronic Commerce
TPP is the first trade agreement to establish guidelines concerning electronic commerce.[8] Specifically, it bans
forced data localization laws, which mandate that firms place physical servers in areas where they would like to
do online business. These laws place undue burdens on businesses and make cross-border data flows more
expensive, restricting electronic commerce and hurting consumers.[9] TPP also prohibits customs duties,
another form of import taxes, on electronic transmissions and includes several provisions to facilitate paperless
trading. These features all aim to encourage e-commerce as a growing method of international trade.
The agreement is also the first to spec ...
Success Factors in Offset Deals: A Case Study Based ExaminationWaqas Tariq
The requests for offset obligations occurs primarily in the area of arms imports and covers the full range of industrial and commercial benefits that companies provide to foreign governments as inducements or conditions for the purchase of military goods and services. Increasingly, all major contracts ask for offset obligations. They are now key differentiators in major contracts and it is a fast growing market. For the suppliers, offsets are a key differentiator in earning new business and therefore should be accepted that much accurateness is put on the successful execution of the offset projects. Nevertheless, it comes to problems during the project phase and sometimes we’ve the situation that a offset project failed. The aim of this paper is to exam which success- giving factors are exists in the offset related interaction between buyer, seller and participating industry. The data for this investigation were obtained from secondary sources which were mainly accessible via internet. After data collection, an analysis was performed which was based on the context of this paper and also in connection with the chosen case study: Saudi Arabia. As a result of this analysis can be derived several success factors, which could be also seen as the foundation for an optimized execution of offset obligations. The paper concludes with a reflection of the investigation approach and as well with a classification of the subject offset. Furthermore the results of the analyzes are summarized and an outlook for further researches is given.
Patent Settlements as an endangered species: DG Comp’s latest Monitoring Exer...C5Live
On 9 December 2013, DG Comp published its fourth report on the monitoring in Europe of patent settlements. Like its predecessors, the report welcomes the continuously low level of settlements that may give rise to antitrust concerns and trumpets that the overall number of settlements has increased, which it says demonstrates that criticisms of DG Comp’s enforcement policy against patent settlements are unfounded.
Shoprite's trade, exchange rate and investment relates issues in and around South Africa, submitted in International Business class, Amsterdam Business School, MBA 2013
PALLISER FURNITURE LTD, The China question, Harvard Business Case study, submitted at International Business class in Amsterdam Business School, MBA 2013.
Microsoft HPC - Kivanc Ozuolmez - Public ContentKivanc Ozuolmez
Part of my presentation on Microsoft HPC technology. The content is reduced, and the part which presents the way HPC architecture is implemented on the client is removed due to data confidentiality.
Business Valuation Principles for EntrepreneursBen Wann
This insightful presentation is designed to equip entrepreneurs with the essential knowledge and tools needed to accurately value their businesses. Understanding business valuation is crucial for making informed decisions, whether you're seeking investment, planning to sell, or simply want to gauge your company's worth.
Cracking the Workplace Discipline Code Main.pptxWorkforce Group
Cultivating and maintaining discipline within teams is a critical differentiator for successful organisations.
Forward-thinking leaders and business managers understand the impact that discipline has on organisational success. A disciplined workforce operates with clarity, focus, and a shared understanding of expectations, ultimately driving better results, optimising productivity, and facilitating seamless collaboration.
Although discipline is not a one-size-fits-all approach, it can help create a work environment that encourages personal growth and accountability rather than solely relying on punitive measures.
In this deck, you will learn the significance of workplace discipline for organisational success. You’ll also learn
• Four (4) workplace discipline methods you should consider
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Improving profitability for small businessBen Wann
In this comprehensive presentation, we will explore strategies and practical tips for enhancing profitability in small businesses. Tailored to meet the unique challenges faced by small enterprises, this session covers various aspects that directly impact the bottom line. Attendees will learn how to optimize operational efficiency, manage expenses, and increase revenue through innovative marketing and customer engagement techniques.
3.0 Project 2_ Developing My Brand Identity Kit.pptxtanyjahb
A personal brand exploration presentation summarizes an individual's unique qualities and goals, covering strengths, values, passions, and target audience. It helps individuals understand what makes them stand out, their desired image, and how they aim to achieve it.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Enterprise Excellence is Inclusive Excellence.pdfKaiNexus
Enterprise excellence and inclusive excellence are closely linked, and real-world challenges have shown that both are essential to the success of any organization. To achieve enterprise excellence, organizations must focus on improving their operations and processes while creating an inclusive environment that engages everyone. In this interactive session, the facilitator will highlight commonly established business practices and how they limit our ability to engage everyone every day. More importantly, though, participants will likely gain increased awareness of what we can do differently to maximize enterprise excellence through deliberate inclusion.
What is Enterprise Excellence?
Enterprise Excellence is a holistic approach that's aimed at achieving world-class performance across all aspects of the organization.
What might I learn?
A way to engage all in creating Inclusive Excellence. Lessons from the US military and their parallels to the story of Harry Potter. How belt systems and CI teams can destroy inclusive practices. How leadership language invites people to the party. There are three things leaders can do to engage everyone every day: maximizing psychological safety to create environments where folks learn, contribute, and challenge the status quo.
Who might benefit? Anyone and everyone leading folks from the shop floor to top floor.
Dr. William Harvey is a seasoned Operations Leader with extensive experience in chemical processing, manufacturing, and operations management. At Michelman, he currently oversees multiple sites, leading teams in strategic planning and coaching/practicing continuous improvement. William is set to start his eighth year of teaching at the University of Cincinnati where he teaches marketing, finance, and management. William holds various certifications in change management, quality, leadership, operational excellence, team building, and DiSC, among others.
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"𝑩𝑬𝑮𝑼𝑵 𝑾𝑰𝑻𝑯 𝑻𝑱 𝑰𝑺 𝑯𝑨𝑳𝑭 𝑫𝑶𝑵𝑬"
𝐓𝐉 𝐂𝐨𝐦𝐬 (𝐓𝐉 𝐂𝐨𝐦𝐦𝐮𝐧𝐢𝐜𝐚𝐭𝐢𝐨𝐧𝐬) is a professional event agency that includes experts in the event-organizing market in Vietnam, Korea, and ASEAN countries. We provide unlimited types of events from Music concerts, Fan meetings, and Culture festivals to Corporate events, Internal company events, Golf tournaments, MICE events, and Exhibitions.
𝐓𝐉 𝐂𝐨𝐦𝐬 provides unlimited package services including such as Event organizing, Event planning, Event production, Manpower, PR marketing, Design 2D/3D, VIP protocols, Interpreter agency, etc.
Sports events - Golf competitions/billiards competitions/company sports events: dynamic and challenging
⭐ 𝐅𝐞𝐚𝐭𝐮𝐫𝐞𝐝 𝐩𝐫𝐨𝐣𝐞𝐜𝐭𝐬:
➢ 2024 BAEKHYUN [Lonsdaleite] IN HO CHI MINH
➢ SUPER JUNIOR-L.S.S. THE SHOW : Th3ee Guys in HO CHI MINH
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➢CHILDREN ART EXHIBITION 2024: BEYOND BARRIERS
➢ WOW K-Music Festival 2023
➢ Winner [CROSS] Tour in HCM
➢ Super Show 9 in HCM with Super Junior
➢ HCMC - Gyeongsangbuk-do Culture and Tourism Festival
➢ Korean Vietnam Partnership - Fair with LG
➢ Korean President visits Samsung Electronics R&D Center
➢ Vietnam Food Expo with Lotte Wellfood
"𝐄𝐯𝐞𝐫𝐲 𝐞𝐯𝐞𝐧𝐭 𝐢𝐬 𝐚 𝐬𝐭𝐨𝐫𝐲, 𝐚 𝐬𝐩𝐞𝐜𝐢𝐚𝐥 𝐣𝐨𝐮𝐫𝐧𝐞𝐲. 𝐖𝐞 𝐚𝐥𝐰𝐚𝐲𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞 𝐭𝐡𝐚𝐭 𝐬𝐡𝐨𝐫𝐭𝐥𝐲 𝐲𝐨𝐮 𝐰𝐢𝐥𝐥 𝐛𝐞 𝐚 𝐩𝐚𝐫𝐭 𝐨𝐟 𝐨𝐮𝐫 𝐬𝐭𝐨𝐫𝐢𝐞𝐬."
Affordable Stationery Printing Services in Jaipur | Navpack n PrintNavpack & Print
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The world of search engine optimization (SEO) is buzzing with discussions after Google confirmed that around 2,500 leaked internal documents related to its Search feature are indeed authentic. The revelation has sparked significant concerns within the SEO community. The leaked documents were initially reported by SEO experts Rand Fishkin and Mike King, igniting widespread analysis and discourse. For More Info:- https://news.arihantwebtech.com/search-disrupted-googles-leaked-documents-rock-the-seo-world/
1. Amsterdam Business School
MBA International Business, part-time
Assignment week 3, November 11th, 2013
Case: Bombardier: Canada vs Brazil at the WTO [HBS 9-7003-022]
Michelle Donovan 10429859
Kivanc Ozuolmez 10429832
2. Clearly Bombardier’s strategy and the available options under discussion will shape
Bombardier’s market position and Canada’s role in the aviation industry in the coming years.
As shown in Exhibit 2, the regional jet market is forecasted to grow in the coming 20 years. In
addition to Bombardier’s market positioning and expected benefits at the corporate level, the
Canadian government andCanadian citizens through employment opportunities and the
aviation supply market around Bombardier will enjoy and benefit from Bombardier’s
successes now and long into the future.Our assumption is that both the Canadian and
Brazilian governments are interested in maximizing domestic welfare.Therefore, the three
options under discussion should not only be considered as Bombardier’s issue, but the effects
should be evaluated from a wider perspective, for the common (domestic) good.Therefore,
whatever the decision is, how much benefit will result, and how the decision is communicated
publicly has high importance.
If Bombardier goes for option one, and urges the Canadian government to impose trade
sanctions on Brazilian imports into Canada, export-related economic issues could be triggered
on different export goods on the Brazilian side, and could result inthe Brazilian government
taking serious actions to resolve the Bombardier vs. Embraer dispute, and cooperatingwith
Canada. The larger the sanctions are for the Brazilian goods, the stronger the effects on the
Brazilian economy and the earlier the Brazilian government will be likely to take serious
actions.
Although the above analysis seems persuasive at first glance, how these sanctions will affect
Canada itself, and how the public voice will react, especially from the sectors unrelated to
aviation, is uncertain. Goods imported from Brazil, such as leather shoes, coffee and
electronic components, are easily replaceable from different countries and suppliers, however,
the effects of any sanctions cannot be easily estimated. (The data given in the case is not
sufficient to estimate the effects of the sanctions on the Canadian economy, or on individual
companies importing Brazilian goods.) It is certainly doubtful as to whether these sanctions,
at $344 million CDN annually (p.14), would have enough of an impact on Brazil to force a
change in direction.
As the common benefits of the sanctions are not fully clear, Bombardier might not be able to
convince the Canadian government to apply trade sanctions on Brazilian products.
Negotiating the situation with the Brazilian government and Embraer is another option, where
success fully depends on what both parties can bring to the table. Currently, Embraer is
dominating the market, and driving for a larger market share. In addition to that, Embraer’s
position in Brazil, where corporate culture is dominant and the Brazilian government is atrue
supporter of Embraer, Embraer is shielded from outside enforcements of the WTO, Canada or
Bombardier. Therefore, Bombardier and Canada should offer something very attractive to get
the Brazilians to the table and ultimately conclude the negotiations successfully.
The negotiation terms are not stated in the case, but we have come up with some options.
Bombardier and Canada may suggest ending the competitive fight and instead starting to
cooperate, for example by dividing market share by price fixing,or offering similar funding
packages. To convince the Brazilians, Bombardier can offer collaborations on some activities,
like R&D, or production of common aircraft components, etc. The option to impose sanctions
on Brazilian imports is also still open and legally allowed by the WTO so this possibility
could also be used as a “threat” in the negotiations.
Whether these terms will be enough to convince Embraer and Brazil is not certain, but the
outcome is likely to be beneficial for both parties. However,this initiative, by nature, has some
3. elements of a cartel-like (monopolistic) structure and may result in resistance from theWTO,
or further issues being raised with the WTO by other countries and companies which are also
aircraft manufacturers and/or purchasers.
An aggressive approach, to match Brazilian government subsidies and PROEX financing with
the help of the Canadian government, is the third option. Bombardier considers this option the
most effective,the quickest to implement and the most advantageous. Through PROEX-like
export financing from the Canadian government, Bombardier can offer comparablefinancing
and pricing options to potential airlines and purchasers, and thus position itself in a stronger
position in the market against Embraer.
Price and financing matching is allowed by the rules of the OECD, of which Brazil is not a
member, but it is not clear if this price and finance fight is in violation of the WTO’s rules.
Even if this practice violates WTO rules, it will give time to Bombardier and Canada to
strengthen their market position, and probably the dispute will get higher exposure in the
WTO and result in an escalation for permanent resolution.
On the other hand, if Canada were to introduce such measures, perhaps Brazil would simply
increase its investment in PROEX in order to overtake Canada again, and the results would be
an escalation or “subsidy war”.
Bombardier thinksthe government’s interest is to focus on the long term effects of support –
otherwise thegovernment should be worried about the results of not supporting Bombardier;
lost export sales, employment issues, fragility of the supply market around Bombardier, and
other different domestic constituencies. But from a timing perspective, as the elections are on
the way, politicians will probably hold short term agendas, and focus on the short term
effects, especially public opinion about potential support. From experience, the Canadian
government knows that any type of support for Bombardier would resonate with both
supporting and opposing public voices across the country. The public reaction, especially
opposing voices, would be the main concern of the government while heading to the election.
As all three options above have their cons and pros, and may result in different outcomes for
Bombardier, the Canadian government and the overall regional jet market, we cannot decide
which way to go only by looking at cons and pros, and expected outcomes. Therefore, we
referred back to scientific research in our reader in hope of finding a direction.
The Harvard Business School review (HBS 9-390-001, 1990) refers to the positive
externalities argument, “concerned with situations where society could benefit from an action
that might be too costly for an individual, rational firm to undertake. …. In such a case, it
would make sense for the government to encourage the firm to undertake those activities,
even if a subsidy (or protection) was required. The social benefits of the government’s action
would outweigh the social costs” (p.4). Therefore we can expect that the Canadian
government’s potential support for Bombardier will be beneficial for overall society, and the
third option is more likely to offer stronger and wider outcomes. Furthermore there is the
profit-sharing argument, that support for Bombardier could improve national welfare. This
support could take the form of subsidizing R&D activities or providing “tax relief or
subsidies…to increase the profitability of private investments…[such as] expand[ing]
production facilities, foreign firms might be discouraged from expanding their own
operations. The result would be increased market shares and profits for the domestic firms” (p
4-5).
4. But then the question arises about managing public opposition to such support. In order to do
this, Bombardier should organize campaigns with politicians and government officials,
separate from election campaigns,which focus on support and its benefits for the common
good. Bombardier should also support election campaigns, maybe even fund (donate to) some
political camps to get the government onto its side after elections. As a pluralist economy, the
Canadian government is lobbied and pressurized by many different interest groups which
have different and conflicting demands, all of which it is expected to consider. In order to
“stand out” among all the different groups, Bombardier should invest in corporate political
activity (CPA).
According to Sean Lux et al, 2011, CPA activity is positively related to firms’ performance
and therefore, the political support mentioned above, or a different kind, is likely to help
Bombardier to get government support for export financing and subsidies, or for restarting
negotiations, or for imposing sanctions.
The HBR article goes on to mention that “conditional strategies which offered the carrot of
liberalized trade backed up by the stick of retaliation” are the most effective in terms of
getting the foreign side to respond with cooperation. Trade liberalization shows much higher
gains than trade protectionism (p.9).
Murtha &Lenway assert that “Countries are better off…if they cooperate…, refrain from
subsidies, and their companies likewise cooperate in a stable oligopoly” (p.122)
Therefore our conclusion is that Bombardier should approach the Canadian government after
the election to ask them to approach the Brazilian government with the aim of restarting
negotiations. We think the Canadian government is more likely to look favorably on this
option than the other two, as this will cost them the least amount of money (it does not
involve substantial injections of cash) and is the least likely to negatively affect public
opinion (again due to money; large sections of the voting public do not want to see more
subsidies given to Bombardier, and their reaction to increased prices due to sanctions on
Brazilian imports is not likely to be positive either). Also this approach is in line with
Canada’s actions in this conflict up until this stage, which have been to “play fair” and
involve the WTO at every stage. Furthermore this option does not preclude the use of either of
the other two options at a later stage. Should negotiations not be successful, the other options
(“stick of retaliation”) are still available, but would involve much more persuasion on the part
of Bombardier.
5. References
Case: Bombardier: Canada vs Brazil at the WTO [HBS 9-7003-022]
New Theories of International Trade (HBS note 390001)
Murtha, T. &Lenway, S. (1994) Country Capabilities and the strategic state: how national
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