MPIB – International Business Strategy
Module VI Active Learning Case-XI
Caltex in Singapore
Shift will bring oil giant closer to customers: chairman. American oil giant Caltex Petroleum is moving its global corporate headquarters to Singapore from Irving, Texas – making it the first multinational ever to do so. The global HQ relocation, which will become operational by March next year, will involve its top brass, including group chairman David Law-Smith and other executive management staff, being based here. “The move to Singapore will position us centrally in the area where we do most of our business and allows us to be closer to our customers and serve them more effectively,” Mr Law-Smith said in a statement out of Texas late on Tuesday. Besides, many of the group’s key operations are already located in the Republic, he added. Caltex is a joint venture between Chevron Corp and Texaco Inc. Elaborating on the rationale for the move, a Caltex spokesman in Texas said that the company obtains about 75 per cent of its revenue from Asia, making Singapore a more practical, centrally-located base for the 15 executives and support staff that will be coming here by March next year. Caltex decision is a significant feather in Singapore’s cap. A Caltex spokesman here told BT that the company had considered other Asian sites like Hong Kong, Manila and Sydney before deciding on the Republic. This highly significant shift of its world-wide corporate HQ to Singapore follows Caltex’s establishment of its global oil trading HQ here. In January last year, it also started increasing its Singapore Office’s Asia Pacific responsibilities by posting more of its key regional officials here. As a measure of how much oil trading it does from here, latest available figures show that its world-wide trading HQ, Caltex Trading, based here, was Singapore’s largest oil trader in 1996 with sales of US$9.9 billion (S$16 billion), or equivalent to about 12 per cent of Singapore’s gross...
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