About BASF
BASF is a German chemical company and the largest chemical company in the world. It has founded in Germany in 1865. BASF originally stood for (Baden Aniline and Soda Factory). Today, the four letters are a registered trademark and the company is listed on the Frankfurt Stock Exchange, London Stock Exchange, and Zurich Stock Exchange.
The BASF Group comprises more than 160 subsidiaries and joint ventures and operates more than 150 production sites in Europe, Asia, Australia, Americas and Africa. Its headquarters are located in Ludwigshafen am Rhein (Rhineland-Palatinate, Germany). BASF has customers in over 200 countries and supplies products to a wide variety of industries. Despite its size and global presence BASF receives little public attention as it abandoned consumer product lines in the 90s.
At the end of 2007, the company employed more than 95,000 people, with over 47,000 in Germany alone. In 2007, BASF posted sales of €58 billion and income from operations before special items of over €7.6 billion. The company is currently expanding its international activities with a particular focus on Asia. Between 1990 and 2005, the company invested €5.6 billion in Asia, for example in sites near Nanjing and Shanghai, China and Katipalla in India.
Aim of BASF
We aim to constantly increase the value of our company by growing profitably. With our products and services, we want to participate in successfully shaping the future of our customers, business partners and employees.
They shape the future
We combine economic success with social responsibility and environmental protection. We make our contribution to finding the answers to global challenges, such as climate protection, energy efficiency, nutrition and mobility. This is our contribution to a better future for us and for coming generations.
| BASF (short overview) | |
| Public | |
| Founded | 1865 |
| Headquarters | Ludwigshafen Germany |
| Key people | Jürgen F. Strube (Chairman of the supervisory board), Jürgen Hambrecht (CEO and Chairman of the executive board) |
| Chemicals, plastics, performance chemicals, catalysts, coatings, crop technology, oil and gas exploration and production | |
Internationalization Process and other activities of BASF
When a company goes to international market, definitely they modify their business strategy for the specific region. If they are not do that they may be not compete the market. Without competition a company cannot explore their business also they are not familiar in the market. BASF follow the rules in the international business market. We are try to focus their strategy some country through this term paper.
Although these European and American additions bolster its business, BASF cannot ignore developments elsewhere. Ever bigger petrochemical and other downstream production facilities are being built in the Middle East. And burgeoning demand in Asia, particularly in China, is resulting in more chemicals being produced locally. Moving into developing regions can have benefits beyond lower production costs. It can allow chemical companies to get closer to both suppliers of raw materials and more potential customers.
It nearly always makes sense to produce bulky chemicals, such as washing powder, where they are sold, to keep transport costs low. This puts places like China, which is a long way from the big Western consumer markets, at a disadvantage in exporting some products. But there are plenty of others to be made. Anything that can be conveniently put into a container and shipped cheaply is likely eventually to be made in Asia's low-cost factories.
Hence even BASF has to shed businesses in which it thinks it is no longer competitive. The next to go may be a factory in Minden, Germany, which among other things makes caffeine. The Chinese now offer caffeine, which is easy to ship, to firms such as Coca-Cola at a third of the price that European factories can.
Nevertheless, demand in China is so great that it will be many years before the country becomes a net exporter of chemicals, Mr Hambrecht believes. Demand across Asia is strong. Around half of future worldwide demand for chemicals is expected to come from the region. BASF already has almost 19% of its turnover in Asia, up from just 9% in 1995.
The foundations of its Chinese factory in Nanjing were laid in 2001. Last year petrochemical production began there in a joint venture with Sinopec, a Chinese oil company. Mr Hambrecht, who fought internal opposition to the investment, believes that such opportunities in Asia offer European chemical companies their only chance to grow faster than at home.
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BASF to strengthen its automotive business in India
Mumbai, INDIA, May 6, 2008 – BASF announced its plans to expand its offerings for the automotive industry in India with investments in plants and technology. The company will build a new engineering plastics compounding plant at its existing site in Thane, which is expected to come on stream by the second half of 2009. As well as being used in the automotive industry, engineering plastics are also employed in the electrical and electronics industries, for example.
BASF has also set up a computer aided engineering (CAE) lab in Thane where its engineers design and optimize new engineering plastic parts in close cooperation with customers. “Advanced CAE technology is a key competence of BASF in the field of engineering plastics,” says Hermann Althoff, BASF’s Group Vice President, Asia Pacific Engineering Plastics. “Offering this service to customers, combined with local supply from the new plant, is a major milestone in growing our engineering plastics business in India.”
BASF has also set up a computer aided engineering (CAE) lab in Thane where its engineers design and optimize new engineering plastic parts in close cooperation with customers. “Advanced CAE technology is a key competence of BASF in the field of engineering plastics,” says Hermann Althoff, BASF’s Group Vice President, Asia Pacific Engineering Plastics. “Offering this service to customers, combined with local supply from the new plant, is a major milestone in growing our engineering plastics business in India.”
Further, BASF Coatings commissioned a new Refinish Color Lab at Mangalore in February 2008, and is expanding its e-coat facility, which is expected to be completed by end of 2008.
“Production figures show that Asia is the fastest growing region in the global automotive industry, with car production increasing by 8 percent last year; in India it has been growing at an average of 15 percent per year over the last few years. Innovations in the automotive industry are increasingly being driven by Asian companies, and BASF supports this trend,” said Prasad Chandran, Chairman BASF Group in India and Head South Asia.
BASF In Australia & Newzealand
BASF employs over 300 people in Australia and New Zealand. Major customers for BASF products in Australia and New Zealand are from the agricultural, construction, petroleum refining, automotive and chemical industries.
BASF provides products and services to the market segments of agricultural products, health & nutrition, colorants & finishing products, catalysts, chemicals and plastics. BASF has a manufacturing operation at Altona in Melbourne, producing acrylic and styrene butadiene dispersions and other specialties. The company has fully equipped laboratories devoted to applications development and material and product testing of dispersions. It is the only company in Australia to produce a full range of aqueous polymer dispersions.
BASF has been in Australia for more than 80 years, and in New Zealand for more than 50 years. BASF was represented in Australasia by Henry H. York and Co. from 1921 until 1963, when BASF Australia Ltd began operating under its own name.
The company’s head office is in the Melbourne suburb of Noble Park, and it has sales offices in Perth, Adelaide and Sydney. BASF New Zealand Ltd services the New Zealand marketplace via its office in Auckland.
BASF’s Construction Chemicals division is the leading supplier of chemical systems and formulations for the construction industry. Continuous innovation and tailor-made solutions ensure its customers are more successful. Its Admixture Systems business unit specifically helps customers in the ready-mix, precast and manufactured concrete and underground construction industries. The Construction Systems unit offers a wide range of products for sports and industrial flooring, external renders and wall insulation, expansion joints, wood preservatives as well as specialist repair mortars, tile adhesives and waterproofing membranes. The division operates production sites and sales centers in more than 50 countries and achieved sales of €2.2 billion with approximately 7,500 employees in 2006.
BASF Construction Chemicals Australia Pty Ltd is active in most facets of the construction industry and operates sales, warehousing and manufacturing facilities in most States.
More information is available on the internet Website: http://www.basf-cc.com.au/
Welcome to BASF in U.A.E.
As a joint venture with The Kanoo Group, who is the partner of BASF since 1970 in U.A.E., BASF Kanoo Gulf was founded in Dubai in 1996. The BASF Kanoo Gulf FZE is a joint venture between BASF AG and The Kanoo Group with 49% and 51% shares respectively. BASF Kanoo Gulf FZE has 10 employees and an annual turnover of around €43 million. BASF Kanoo Gulf FZE provides the entire BASF portfolio with a main focus on sea water desalination and gas treatment.
In 2000 as a free zone establishment BASF FZE was formed in Dubai. BASF FZE is a distribution center for products manufactured by BASF group companies for sales in MENA (Middle East & North Africa) region and Iran. BASF FZE had a turnover of around €117 million in 2006.
BASF is present in U.A.E. as part of the Business Center Turkey, Middle East & North Africa (BCT) with headquarters in Istanbul.
In 2000 as a free zone establishment BASF FZE was formed in Dubai. BASF FZE is a distribution center for products manufactured by BASF group companies for sales in MENA (Middle East & North Africa) region and Iran. BASF FZE had a turnover of around €117 million in 2006.
BASF is present in U.A.E. as part of the Business Center Turkey, Middle East & North Africa (BCT) with headquarters in Istanbul.
Motives
1. Firstly BASF try to introduce their company with globally.
2. We are see their strategy which they follow in china,
a. Mainly they go to China for expanding their business,
b. China’s labor costs is nominal,
c. China’s environment is flexible,
d. They have lots of resources,
e. When they goes to China. Their tendency is that, China is becoming a industrialist country overall the world.
f. Captured the huge market with lower cost,
3. In the case of Australia & New Zeland,
a. There is also same case for introducing their test in AUS & New Zeland
b. They have more expert people in AUS & N. Zeland,
c. Cver the Australian part under the policy of global expansion
Implication
1. In the case of China
a. They had no expert employee when they entered in China,
b. Not so developed,
c. Governments were not helpful,
2. In the case of Australia
a. Labor cost is so high
b. Tex rate is also high
c. Government rules and regulation is so tight.
Questions that may be asked:
- The chemical industry is the most internationalized industry in Germany. What are the characteristics of this internationalization?
- Which companies are the dominant producers in the German chemical industry? What main marketing and production concept does each of them have?
- How a company motivated for internationalization?
- What is the implication might create some problem?
Conclusion
There is main three perspectives or three reasons a company expand their business globally. Expand sales, Acquire recourses, and Minimize risks. BASF is the world’s leading chemical company: The Chemical Company. Its portfolio ranges from oil and gas to chemicals, plastics, performance products, agricultural products and fine chemicals. As a reliable partner BASF helps its customers in virtually all industries to be more successful. With its high-value products and intelligent solutions, BASF plays an important role in finding answers to global challenges such as climate protection, energy efficiency, nutrition and mobility. BASF has more than 95,000 employees and posted sales of almost € 58 billion in 2007. Further information on BASF is available on the Internet at www.basf.com.
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