WSP Holdings Competition
Now Viewing WSP Holdings's competition in: Primary Metals Manufacturing (primary)
Call Preparation Questions
Customers, Marketing, Pricing, Competition
Is the market growing for the products the company produces? - The primary metals industry depends on the growth of other manufacturing sectors.
Who are the major users (industries or specific companies) of the company's products? - Major customers for metals are the auto, appliance, construction, machinery, aircraft, wire, and consumer goods industries.
Has slower aircraft manufacturing impacted the company? - Aluminum prices have been hit especially hard by weak airline manufacturing.
What are typical contract terms for customers? - Producers sell to large end-users on long-term contracts and to smaller users on a spot basis.
Does the company follow a price leader in the industry? -
Competitive Landscape
Demand comes largely from the manufacturers of durable goods like motor vehicles, machinery, containers, and construction steel. The profitability of individual companies depends largely on efficient operations, because most products are commodities sold based on price. Big companies have large economies of scale in production. Accordingly, most producers of secondary products buy raw metal from the large producers. Small companies can compete by operating efficient local mini-mills or producing specialty products. The industry is highly automated: average annual revenue per worker is close to $300,000.
Business Challenges
CRITICAL ISSUES
Demand Depends on Manufacturing, Construction - Demand for primary metals depends on the health of the US manufacturing sector, particularly the manufacture of motor vehicles, metal products, and machinery, and on commercial construction. Demand can be highly cyclical: during the early 2000s recession, US production of primary metals dropped 15 percent.
Competition from Imports - Imports of primary metals, mainly raw steel and steel products, often depress US metals prices. Volume varies from year to year, but imports typically account for 20 to 30 percent of the US market. Import quotas and tariffs can be imposed when foreign manufacturers "dump" steel on the US market.
Industries Where WSP Holdings Competes
- Metals & Mining
- Steel Production(primary)
