Suprema Cars

Nguyen Thi Hong Van

Nguyen Duc Thuan
Le Ngoc Thuy
Truong Thuy Chung
 Outline
• Background: Ms. Hong Van
• Solution 1: Mr. Thuan
• Solution 2: Ms. Ngoc Thuy
• Solution 3: Mr. Chung
• Solution 4: Ms. Hong Van
• Conclusion: Ms. Ngoc Thuy
 Background
• “Our cars are for people who want something
different”
• Manufacturing Classic English Sports Car –
“hand-made cars”
• Losing sales and market shares in the last 5 years
• Problems with the labor force
• A number of loyal customers
 Solution 1
• Increase production substantially to 4,000
cars a year.
• Subcontract some of the manufacture of
the components to a low cost foreign
manufacturer
 Solution 1: Advantages
• Reducing labor hour
• Reducing cost
• Increasing production
 Solution 1: Disadvantages
• Increasing the number of warehouses
• Increasing inventories
 Solution 2
• Try to get additional finance from an
outside source
• Then have a major launch of the cars in
the United States.
Solution 2: Additional finance from
an outside source
• Two ways:
+ borrow money from banks and other
financial institutions
+ issue bonds, shares or debentures
Solution 2: Additional finance from
an outside source
• Advantages:
 giving a number of potential sources of
finance:
+ to meet needs of a growing business

+ to finance the business activities

 keeping the financial risk of the company at
an optimal level
Solution 2: Additional finance from
an outside source
• Disadvantages :
– Interest payment and capital repayment risk
 Solution 2: USA market
• Advantage
+ Transform the Suprema Cars’ fortunes in the
long term
 Solution 2: USA market
• Disadvantages
+ highly potential competition
For example:

1947 MG TC 1953 MG TD
 Solution 3
• Use the Suprema Cars brand name
• Design and launch a sporty,
environmentally friendly, dual fuel, small
car.
 Solution 3: Advantages
• Diversifying and expanding business:
 keeping production of the classical sporty car
 Design and launch a sporty environmentally
friendly, dual fuel, small car
• Attracting new customers and increasing
sales figures.
 Solution 3: Disadvantages
• Lack of experiences in producing sporty
environmentally friendly cars
 Difficulty and unfamiliar to take over market
 Time consuming and costly in market research
• Number of well-established competitors
such as Toyota, GM, Honda Insight
 Solution 4
• Keep manufacturing the classic models
• Cut price of the new line of cars by
installing automated machinery and accept
a lower profit margin by 50%
 Solution 4: Advantages
• Maintain customer loyalty for classic
models
• Attract the segment of new middle-class
customers, between 20-35
• Increase morale of workforce
 Solution 4: Disadvantages

• Increasing costs

• Losing a number of loyal customers

 Conclusion
• Solution 1: increase production and subcontract
with component manufactures
• Solution 2: get additional finance and break into
USA
• Solution 3: launch new mini car and use the
Suprema Cars brand name
• Solution 4: Keep manufacturing the classic models
and cut price of the new automated cars by 10%
 Conclusion
• Consider :

Risk & Return