Problem-Based Learning (PBL) Scenario: AutoEdgeAutoEdge
is a leading national automotive supply company located in Detroit,
Michigan. Founded by Jonathan McAlister in 1976, the company specializes
in engines and transmission parts and has been supplying products to
the three largest U.S.-based automakers for over 30 years. AutoEdge’s
name is known by customers and leaders in the automotive industry for
quality, dependability, and reliable products. In fact, despite the
extra cost that is added to the automobiles, consumers appreciate the
AutoEdge brand name and often make purchases because of it. In
2005, AutoEdge’s board of directors decided that the company needed to
make some drastic changes because of the high cost of labor, rigid
American regulations, and increased competition from other engine and
transmission part suppliers. Their solution was to gradually close all
manufacturing operations in Detroit and begin outsourcing to a
well-known factory in South Korea. The board reasoned that this change
would allow the company to compete with the growing industry, meet the
automotive manufacturing demands, and increase company profits. Some
board members were skeptical about the move, however, because AutoEdge
had built a reputation for high-quality, detailed craftsmanship, and
they feared that transitioning the manufacturing operations overseas
would cause quality to diminish. For the next 5 years, this strategy proved successful. The company showed signs of financial growth and company profit.However,
in 2010, the company was found guilty of supplying products that failed
quality tests. As a result, millions of automobiles had to be recalled.
The recall was highly publicized, and the issue of poor quality
products impacted negatively on American automotive companies.
AutoEdge’s $51 per-share stock has fallen to $4 per share, and brand
acceptance has come under scrutiny among even its most loyal customers.
Although some economists blame these negative effects on the products,
others believe that it had to do with the termination of AutoEdge’s
Chief Executive Officer, Fred McFadden. Lester Scholl, Chairman
of the Board of Directors, has called an emergency meeting to discuss
AutoEdge’s short-term and long-term strategies. Among other things, they
need to discuss the possibility of continuing production overseas or
returning it to the United States. Lester and others on the board are
well-known for being financially conservative and risk-averse. Because
the American economy is experiencing high unemployment, low interest
rates, low GDP, and low inflation, it might be sensible to make the
change. To some extent, they believe that these macroeconomic factors
can be used to their advantage. They realize the immediate challenges
such as the brand damage, the growing competition, and the financial
challenges the company is facing require immediate action. A new
strategy must be formulated quickly to save the company from bankruptcy.You
have been hired by AutoEdge’s board of directors as a research analyst.
Primarily, your job is to list and describe some of the legal,
cultural, financial, and economic factors that AutoEdge needs to
consider when deciding to either stay in South Korea or return to the
United States. Because Fred McFadden was recently terminated, you will
work directly with the board until a new CEO is named. Assignment You’re meeting with Lester in his office to discuss the details of your presentation to the board next week.”Given
all of the research that you have completed over the past several
weeks,” he says, “you should have most of the information you need to
make a presentation to the board. The board doesn’t want you to do any
more research on all of the topics; rather, we want you to summarize the
research that you have already done. “”Yes,” you say. “I think I have what I need.””Of
course we want your final conclusion and recommendation on what the
company should do regarding the location issue, as well,” he says. “What type of presentation do you have in mind, Lester?””A
PowerPoint presentation would be appropriate for this group,” he says.
“I want you to include slide notes, too, in case we have to go back and
look at something at a later date. Your PowerPoint presentation should
contain between 10–15 slides, not including the title slide and
reference slide(s). For each slide, you should have between 150–200
words in the Notes sections. Let’s take a few minutes now to go over how
the slides should be organized. I’ve done similar presentations, so I
can save you some time with a few pointers.”When you get back to
your office, you type out your notes about each element you discussed
and the overall organization of the presentation. For this presentation,
you are addressing the following elements:Legal, social, and financial factor considerationsEconomic factors: gross domestic product (GDP), inflation, interest rates, unemploymentElasticity of demandEconomies of scale and efficiencyStrengths, weaknesses, opportunities, and threats (SWOT)Market structureRiskCosts (marginal, fixed, variable, etc.)International expansion Deliverable Length:10–15 slides + 150–200 words per slide in the notesThis
assignment is summary of all the past assignments plus additional
thoughts. If you are willing to help me out with this assignment, I have
attached the other assignments I have completed for you to use for this
assignment.  ECON616-DB1.docxECON616-DB2.docxECON616-DB3.docxECON616-DB4.docx




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