Chrysler Group Uses FinanceSeer for Business Planning http://www.financeseer.com/case-studies/files/Chrysler-Case-Study-2014_07_31c-3.pdf “FinanceSeer enables us to quickly run what-if simulations to determine the impact of changing market and economic assumptions. It also allows us flow those assumptions from our Income Statement down through our Cash Flow statements at a speed we never imagined possible. FinanceSeer has been an invaluable tool for us to develop our business plan.”
-Jim Garneau, Director of Business Planning at Chrysler Group LLC
At a Glance
Company Profile
Location: Auburn Hills, MI, USA
Industry: Automotive
Revenue: $72.1 Billion (2013)
Employees: 73,712 (Dec, 2013) Website: Chryslergroupllc.com
Company
…show more content…
In addition, consumer appetites and preferences are constantly changing causing automakers to continuously evolve in order to maintain or grow market share.
In order to better react to these changing conditions, Chrysler recognized the need to improve their modeling capabilities. They envisioned the need for a new financial modeling tool that could improve the efficiency of their analysis and enable better what-if decision making. To help them achieve these objectives, Chrysler turned to FinanceSeer for assistance.
Together with FinanceSeer, they built a dynamic financial model which was highly robust yet much more flexible and efficient than the Excel-based models that they had relied on previously. Today, Chrysler continues to update and expand their FinanceSeer models with the same intuitiveness and level of ease as they did from day one.
The
…show more content…
Billion dollar investment strategies are made years before new vehicle lines are produced and sold. Yet at the same time, market conditions, such as the cost of gas and the availability of consumer credit, can have a big impact on the demand for vehicles causing investment returns to fluctuate significantly.
Rapid understanding of how these changing market conditions may impact the Income Statement, Balance Sheet and Cash Flow is of critical importance for Senior Management.
At the same time, calculating the impact of changing gas prices and available consumer credit requires a level of modeling granularity that Chrysler’s existing spreadsheet models simply could no longer contend with.
“In my spreadsheet models, I was managing thousands and thousands of individual cells. The time it took to make updates to the model took away from my ability to evaluate alternative scenarios.” --Jim Picklo, Business Planning Manager at Chrysler Group LLC
The Solution
Chrysler Group needed a solution that was more robust than their existing spreadsheet models, yet, at the same time was still simple to learn and use. Furthermore, Chrysler’s new modeling tool needed to have a familiar reporting capability and continue to integrate with their existing budgeting
The forecasted balance sheets, income statements and assumption provided to Goldengate Capital by Ernst and Anderson are shown in Exhibits. All dollar figures quoted are in thousands. The financial forecasts are conservative case sales estimates from Dr. Martinez. The three main factors considered in the estimates were case sales trends & demand, inflation and real price increases reflecting Calaveras' strengthening brand recognition.
In the United States, modern car manufacturing has been historically dominated by the American companies including Ford Motor Co., Chrysler Group LLC, and General Motors Co. These three companies, known as the Detroit Three, controlled 95% of the market in the 1950’s and the dominance continued until the beginning of the 21st century. In the 1980’s Japanese auto manufacturers entered the United States, a decade later the Germans, and finally in 2000’s the Koreans. By the end of 2009, the Detroit Three only accounted for 45% of the total U.S. auto market. Another factor that had influence on this was constant fluctuations in gasoline prices and price sensitive consumers. According to the U.S. Department of Energy, gas prices hit record high averaging $3.07 per gallon in May 2007 and kept climbing up to $4.08 in July 2008. As gas prices kept increasing, consumer buying trends have been changing. In 2006 sales for SUVs, pickup trucks, and vans dropped 16%, while the market for compact cars rose by 3%. Unfortunately, the Detroit Three were not prepared for this since their...
BARS is Deutsche Banks spreadsheeting tool for world wide capture and sophisticated analysis of customers financial statements. The application offers to Deutsche Banks credit officers access to 200.000 customers and 1.6 million financial statements stored in a central database. In order to facilitate data capture and to further streamline the credit process the application will be equipped with an XBRL-import interface.
AutoZone has responded to changes in its' macro environment by placing stores in regions "that have large number of vehicles seven years old and older because of these cars' need for repairs and maintenance" (Wikinvest.com, 2012). Nationally, sales of new automobiles were at a 30-year low in 2009, but they have since rebounded slightly. Customers are still reluctant to buy new vehicles due to concern over high prices and general jitters about the economy. To combat this, many manufacturers have been offering discounts to lure consumers to purchase. As a result, AutoZone is facing a boon in the marketplace- "the cars and trucks in America's driveways have reached a record old age" (USAToday, 2012). In addition, there are more vehicles registered in the U.S. than previously.
Sage 50. There are three different areas which must be discussed. These are the revenue, expenditure, and financing cycles. These areas are written about from the author's own knowledge from using the software, as learned from the book by Carol Yacht (2013).
Ford Motor Company Introduction This paper will address an analysis of the key success factors in strategic planning for the Ford Motor Company, including planning, product offerings, marketing and sales. The paper will also include financial characteristics and a competitive analysis of the Ford Motor Company. Ford Motor Company The Ford Motor Company inspired a manufacturing revolution with its mass production assembly lines in the early 20th century. Ford and Lincoln are one of the world's most well known automotive brands, most known for the Ford Mustang, and F-Series pickup trucks.
The bit of the general business of the auto associations is basically influenced by the arranging and repeat of new model releases. Undeniably, the new models have tended to have huge updates every 4 or 5 years with simply minor modifications in the center. Nevertheless, on account of the rising purchaser wants in association with in-auto development and the
Obviously, this case aims to evaluate Joanna’s analysis. Throughout the analysis, we will estimate the cost of debt, cost of equity, and cost of capital through different financial analysis models.
The American Automotive Industry, popularly known as the U.S. Automotive Industry is one of the most rapidly evolving industries in North America. It is generally oligopolistic with a few players who in the past have been known to avoid price competition among themselves. The industry consists of industries manufacturing vehicles, car parts, replaceable parts and those engaged in assembling parts into complete models. However, the most dominant players in this industry are the vehicle manufacturers. The players design various models, produce the various parts that each model needs and assemble them into a finished product before availing them to the market. General Motors, Chlysler and Ford motors, dominate the U.S. Automotive mobile. They are popularly referred to as “The Big Three”.
Since the invention of the Ford’s Model T, the modern automobile industry has been manufacturing affordable automobiles for everyone in the U.S. The age of design of cars boomed as people started to demand more customization of their cars (Model T only came black). This began the shift from manufacturing-driven automobile to a more design-driven automobile.
Toyota’s uses both differentiation and low cost as generic strategies to try and gain a competitive advantage over their competitors in the automotive industry. The market scope that Toyota uses is a broad one that encompasses nearly every type of customer that is in the market to purchase an automobile. Toyota is able to target such a large market because they have something for everyone. Toyota has four wheel drive trucks and SUVs for the outdoor types or those who live in areas that face severe weather conditions, hybrid models like the Prius for the eco-friendly customers that are interested in saving the environment, along with the standard cars for general, everyday use. Additionally, Toyota provides vehicles for all price ranges.
One can accurately state that the role of the competent and capable financial manager is figuratively worth its weight in gold. As global markets today's financial markets increase in complexity, the tradition of learning by doing will not suffice. The financial manager today must hit the ground running with ready expertise to be used effectively as the CFO or as part of a team of financial experts within the ranks of the CFO's office. In navigating the international marketplace effectively, financial managers find themselves in a technology driven, real time information deluge which helps them to satiate the knowledge demands of investors, commercial and investment bankers, shareholders, employees, brokers, traders et al who must know particular companies, their products and the markets wherein they operate. The financial manager is charged with providing the information necessary to fulfill this relentless demand for a range of financial information that literally runs the gamut.
Any successful business owner or investor is constantly evaluating the performance of the companies they are involved with, comparing historical figures with its industry competitors, and even with successful businesses from other industries. To complete a thorough examination of any company's effectiveness, however, more needs to be looked at than the easily attainable numbers like sales, profits, and total assets. Luckily, there are many well-tested ratios out there that make the task a bit less daunting. Financial ratio analysis helps identify and quantify a company's strengths and weaknesses, evaluate its financial position, and shows potential risks. As with any other form of analysis, financial ratios aren't definitive and their results shouldn't be viewed as the only possibilities. However, when used in conjuncture with various other business evaluation processes, financial ratios are invaluable. By examining Ford Motor Company's financial ratios, along with a few other company factors, this report will give a clear picture of how the company is doing now and should do in the future.
Maintaining a company’s financial assets is a daunting task. Cash management techniques and short-term financing provide accounting executives with the tools needed to survive the constant changes within the economy. The combination of these tools and the knowledge of the world economy will assist companies in maintaining current assets and facilitates growth.
Today, there is a range of computerised systems in the market that business can use to keep track of their finances; few of the most recognised for their performance are Sage, Microsoft Dynamics, Oracle, QuickBooks, SA...