Johannes De Turck

Johannes De Turck

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Johannes De Turck
On December 1, 2017, Johannes De Turck commented on Impact of Isolationism on Manufacturing Strategy of Ford Motor Company :

Thanks for this article, Amanda, enjoyed reading it. I agree with your recommendation that Ford should take a long-term view in selecting where to deploy its capital geographically. As you correctly state, expected market demand / volume should be the principal consideration in choosing where to install supply, as opposed to regulation that might go or not go through and is always dependent on the current political climate, intrinsically temporary and unpredictable. I wonder if another way of dealing with Trump’s criticism might be spreading out the manufacturing over many different countries, much like the ‘borderless manufacturing’ concept we have seen in the Li & Fung TOM case. This way, Ford might be able to both profit from lower wages for the labor intensive part of car manufacturing (e.g., plating or seat and electronics manufacturing), whilst leveraging the technological edge in the US for highly automated assembly. As a result, cars are technically still being manufactured in the US and Trump’s criticism, including the threat of high import tax rates for foreign cars (which may well be up to 35%) [1]

[1] ‘Trump threatens German carmakers with 35 percent U.S. import tariff’, Reuters, https://www.reuters.com/article/us-usa-trump-germany-autos/trump-threatens-german-carmakers-with-35-percent-u-s-import-tariff-idUSKBN1500VJ, accessed December 1, 2017

Johannes De Turck

Brilliant read, thanks a lot for putting this together. I agree with your overall recommendations and actions to be taken by organizations like ETP to go beyond lobbying. An additional action to be taken by US-based gas producers to mitigate the risk of renegotiated or terminated NAFTA agreements, is ramping up exports of liquefied gas to other markets such as the EU. For this course of action, the rhetoric and dynamics within the Trump administration might actually be helpful. In August 2017, Trump visited Poland and was cheered by the crowd as promised to raise US gas exports. [1] US producers profit from a dual dynamic: Trump is incentivized to disprove allegations of his close ties with Russia and (Eastern) Europe actively seeks to liberate itself from the dependency on Russian gas.

‘US and Russia step up fight to supply Europe’s gas’, Financial Times, https://www.ft.com/content/352f4cac-6c7a-11e7-b9c7-15af748b60d0, accessed December 1, 2017

Johannes De Turck

Thoroughly appreciated your article, Alex. As a Belgian and a citizen of Leuven (where ABI’s HQs are) and thus a natural beer aficionado, I too, worry about a sustainable future for my favorite brew. I applaud ABI’s efforts to reduce their drinking water footprint and am bullish on their ability to deal with increasingly more unpredictable weather patterns and crop yields. As Anna pointed out, this threat is lessened by ABI’s global presence and its ability to source raw materials from many markets geographies. To address your final question around a potential disliking of the market of ABI’s sustainability efforts, it merits looking at what its biggest competitor, Heineken, has been doing, and why. Heineken states that it focuses on protecting water resources as it is ‘everyone’s responsibility to safeguard it for the future’. [1] For a for-profit company that uses water as its most important raw material, sourcing it sustainably does not only make moral but also financial sense.

‘Sustainability Focus Areas’, Heineken, http://www.theheinekencompany.com/sustainability/focus-areas, accessed December 1, 2017

Johannes De Turck

Thank you for this article Cenk, really enjoyed reading about an application of 3D printing that was less obvious to me. I generally agree with your concerns around (i) a smooth transition towards a speed-factory model, (ii) possible consumer confusion due to ‘over-customization’ and (iii) the impact on raw material choices. I would like to add one more concern and slightly push back on your fourth concern (risk for copy cats if automated production picks up speed). One additional concern is that Adidas needs to build a sound business case to pressure-test the assumed financial gains of its speed factory model – machines or suitable raw materials might be very costly to procure. Second, I feel that the risk of copy cats is present regardless of the technological manufacturing platform: even without access to advanced automation, it is feasible to counterfeit Adidas and other fashion wear in a low-cost manner. In the European Union alone, the fashion industry loses around 28 billion USD annually to counterfeited clothing and footwear. [1]

‘Fighting the $450 Billion Trade in Fake Fashion’, The Business of Fashion, https://www.businessoffashion.com/articles/intelligence/fighting-the-450-billion-trade-in-fake-fashion, accessed December 1, 2017

Johannes De Turck

AHL, thanks for the interesting article and, as Will also pointed out, the great Arrested Development reference. I agree that diversification is key to Del Monte’s long-term viability as a business. Apart from offering an opportunity for a great title, the Bluth’s frozen banana stand hints to an interesting additional diversification strategy: frozen fruits. Demand for frozen fruits is expected to significantly over the next decade, fueled by a rapid ‘westernization’ of household habits in Asia, where women have less time to prepare fresh meals – demand for frozen fruit and vegetables is poised to grow at a 7.2% CAGR over the 2017-24 period. [1] Expanding into frozen banana production might also help to address the underlying issue of volatile supply as mentioned by JN. Excess production can be frozen and used for times when production suffers from climate change or other weather effects.

[1] ‘Rising Demand for Convenient and Easy to Prepare Foods Drives Growth in the Global Frozen Fruits and Vegetables Market’, Global Industry Analysts, http://www.strategyr.com/MarketResearch/Frozen_Fruits_and_Vegetables_Market_Trends.asp, accessed December 1, 2017

Johannes De Turck
On December 1, 2017, Johannes De Turck commented on The Disruptor, Disrupted? Nasdaq Wrestles with Blockchain :

Intriguing read, Sasha, many thanks for the time and research you put into this. Like, TJ, I too was not aware blockchain technology could be used in securities transactions. While I am aware that a stock market exchange such as NASDAQ can buy other exchanges, as NASDAQ has done [1], I was intrigued to read your first recommendation for NASDAQ: investing in cryptocurrency startups or assets. I agree that this would be a good hedge against missing out on the growth of blockchain, but would argue that clear rules of engagement need to be set, as NASDAQ would then act as both market maker and player.

[1] Wall Street Journal, ‘Nasdaq Lands OMX for $3.7 Billion; Are More Merger Deals on the Way?’, https://www.wsj.com/articles/SB118007353287814521, accessed December 1, 2017