Multinational Financial Management Alan Shapiro 8th Edition J.Wiley

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Multinational Financial Management Alan
Shapiro8th Edition J.Wiley Sons

• Power Points by
• Joseph F. Greco, Ph.D.
• California State University, Fullerton

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CHAPTER 1

• Introduction Multinational Enterprise and
  Multinational Financial Management

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PART I.THE RISE OF INTER-MODAL INTERNATIONAL
TRADE

• A. THE REVOLUTION IN WORLD TRADE AND FINANCE
  (1985)
• 1. Containerization
• a. Containers (20 (TEU) and 40)
• b. Make Inter-modal transport possible

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This New Method of Shipping Has Revolutionized
Global Trade and Finance
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CARGO CRUSH
7.5
NO. 1
LA
7.3
6.7
Long B
NO. 2
5.8
2005
4.8
NY/NJ
NO. 3
4.5
2004
Source L.A. Times, C-1, 2/4/2006
- IN MILLIONS OF TWENTY FOOT CONTAINERS (TEUs)
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Worlds Top 5 Container Ports
Millions of Twenty Foot Containers
Source L.A. Times C-1, 2/22/2006
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Port of Long Beach/Los Angeles
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A Containerized Port in China
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Containerized Shipping isIntermodal
By ground mode
By rail mode
By air mode
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A Small Container Ship
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Intermodal Transport
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Voyages to Hong Kong on Hanjin
The Time Length Of Global Shipping
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PART 1 THE RISE OF THE MULTINATIONAL
CORPORATION

• I. The MNC A Definition
• a company with production and distribution
  facilities in more than one country.
• with a parent company located in the home
  country
• at least five or six foreign subsidiaries

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THE RISE OF THE MULTINATIONAL CORPORATION

• The MNCs Evolution
• Reasons to Go Global
• 1. More raw materials
• 2. New markets
• 3. Minimize costs of production

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THE RISE OF THE MULTINATIONAL CORPORATION

• RAW MATERIAL SEEKERS
• exploit markets in other countries
• historically first to appear
• modern-day counterparts
• British Petroleum
• Exxon

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THE RISE OF THE MULTINATIONAL CORPORATION

• MARKET SEEKERS
• Produce and sell in foreign markets
• Have heavy foreign direct investors
• Represented today by firms such as
• IBM
• MacDonalds
• Nestle
• Levi Strauss

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THE RISE OF THE MULTINATIONAL CORPORATION

• COST MINIMIZERS
• seek lower-cost production abroad
• Their motive to remain cost competitive
• Represented today by firms such as
• Texas Instruments
• Intel
• Seagate Technology