Cold Rolled Steel Industry

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2012
Nelson Hudspeth, Ed Lapine, Thai Phi, Nevan Phillips
Ton Dong A
4/1/2012
2012
Nelson Hudspeth, Ed Lapine, Thai Phi, Nevan Phillips
Ton Dong A
4/1/2012

International Marketing Plan -Vietnamese Steel Industry
International Marketing Plan -Vietnamese Steel Industry

Executive Summary
“Quality – Prestige – Sustainable Growth” is the motto of Ton Dong A. In order to assess the viability of expanding Tong-Dong A’s expansion into the United States market this analysis covers the Environmental, Industrial, Customer and Competitive oriented aspects of the Cold Rolled Steel market in the United States.

Environmentally, the United States is an attractive option because of its embrace of capitalism and free trade. It is a world leader in developing technology through research and development. The US is the largest and most powerful economy in the world. The necessity for infrastructure improvements has caused the demand for steel to rise in the US. The US and Vietnam concluded a Trade and Investment Framework Agreement (TIFA) in 2007. The US does the majority of its trading with countries with which it has trade agreements. The Rolled Steel Shape Manufacturing Industry in the United States is one that is comprised of establishments primarily engaged in rolling or drawing shapes from purchased steel, such as plate, sheet, strip, rod, and bar. There are currently approximately 120 companies in the Rolled Steel Shape Manufacturing industry in the United States. Rolled Steel Shape Manufacturing is a mature industry in the US, with the major companies holding approximately 61% of the industry market share. The customer base covers a myriad of products used by numerous industries, dominated, but nit limited to, aircraft manufacturing, building and highway construction, and technology. These customers are currently trending towards lower priced alternatives to domestic rolled steel manufacturers, such as lightweight plastics and lower-cost imports. The upswing in the US economy has caused this market to grow steadily since the trough of the economic downturn in 2008, and continued growth is expected.

The steel industry is inherently competitive, nationally and abroad. Though Vietnamese national competition is decreasing, U.S. neighboring countries, Canada and Mexico, are at the top of the list of Countries Exporting Steel Products. China remains to be a strong competitor as they provide 46% of the world’s steel and grow at 8.9%. In addition, several U.S. domestic companies in direct competition with Ton Dong A’s business model.

Being the largest and most powerful economy in the world makes the US an attractive market to enter. The US economy has recovered well from the 2008 economic downturn and the steel industry has recovered alongside the economy. However, given the nature of Cold Rolled Steel industry and its competitive landscape we feel that entry into the US market is ill-advised at this time. Introduction

“Quality – Prestige – Sustainable Growth” is the motto of Ton Dong A. This research project’s main purpose is to provide a complete analysis of the current state of the United States Cold Rolled Steel Industry, so that they may further realize this mission in new markets. Our team will run through an Environmental, Industrial, Competitive and Customer oriented analysis of the industry for Ton Dong A; culminating in our recommendation on the profitability of expanding export markets into the United States.

Sheet metal (HS 7209) is simply metal formed into thin and flat pieces. It is one of the fundamental forms used in metalworking, and can be cut and bent into many different shapes. Cold Rolling occurs with the metal below recrystallization temperatures, which increases strength via strain hardening up to 20 percent. Cold rolling also improves surface finish and holders tighter tolerances. Hot Rolling occurs with metal above recrystallization temperatures, and is mainly used to produce sheet...
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