Abstract
The analysis examined the influence of bank combination on automotive business financing.
61 answerers selected through ideal random sampling approach from GM Search engines Nigeria Ltd formed the population for your study.
Data was accumulated using a survey instrument designed by the analyst. Chi-Square Statistical method was used to test the ideas and all findings kept at 0.05 alpha dog significant level. Your Analysis of the data revealed that your participants almost unanimously agreed that standard bank consolidation had disturbed positively to the car or truck sector in Nigerian financial system.
Based on the findings it absolutely was therefore recommended a few things that a regular review of automotive industry in Nigeria by the appropriate regulators while effort needs to be made to improve the energy system electricity circumstances in Nigeria. Taxie
INTRODUCTION
Backdrop of the Study
Mergers along with acquisitions should be considered genuine as an instrument for enhancing banking performance size and developmental roles in every economic system. Mergers and acquisitions particularly in the banking companies are now a global happening.
All over the world and due to the role of financial size has become an important ingredient for success from the globalizing world. The last few years get witnessed the creation of earths big banking teams through mergers and acquisitions. The trend has been depending factors such as prospects of cost-savings due to financial systems of scale and also more efficient allocation of resources enhanced productivity in resource allowance and risk reduction arising from improved managing. However the automotive industry is not neglected in the process of alliances. Over the years the industry has noticed different types of global alliances. Regarding instances Renault- Nissan VW-Skoda GM-Daewoo to bring up a few them
Previously the small size of many Nigerian banks each along with expensive headquarters hefty fixed costs and operating expenses along with bunching of branches in few commercial centers had lead to very high average cost for that industry. This in turn has implications for the valuation on intermediation the spread between deposit and lending premiums and puts unnecessary pressures on financial institutions to engage in sharp techniques as means of tactical. In an effort to survive your hurdle the Main Bank of Nigeria presented the 25 thousand Naira minimum capital base for banks to help make our banking institutions much stronger and to able to compete favorably with banks in the world within providing credit features to other sectors connected with Nigeria economy.
However within 2004 as part of financial reform in some growing economies the Nigerian consumer banking system underwent exceptional change in terms of the amount of institutions ownership structure as well as depth along with breadth of surgical procedures. Banks begin to merge with other banks while bigger banks set out to acquire smaller ones while automotive business has become an increasingly essential contributor to countrys gross domestic product primarily through strong rise in the motor sectors in terms of increasing variety of local production as well as number of sales. This also is not peculiar to be able to Nigeria alone.
This scenario adds to the question -what impact involving banks consolidation upon automotive industry financing in Nigeria It is important to think about this evolution coming from a life cycle regarding production assembly and purchases that have impacted for the financial statements of Game master Motors Nig LTD. In order to sustain this process the automotive industry as a whole requires huge capital high intensity from strong along with reliable financial back- as much as remain viable throughout the market and optimize their particular environmental impact connect positive steps to help non-governmental organization and other stakeholders to discharge their social business responsibilities while maintaining design of product service process from a sustainability standpoint. Hence this work is scheduled to assess the effect of bank combination and capital provision for the automotive marketplace financing in Nigeria An instance study of General motors Nigeria ltd
COOPERATE PROFILE Involving GM MOTORS LTD
Game master Nigeria is a foremost gambler in the automotive market and one of the top motor vehicle assemblers and entrepreneurs in the country. GM Nigeria is really a joint venture company amongst UAC of Nigeria Plc – one of the largest conglomerates in Nigeria and Vehicle Corporation of Detroit the worlds largest automobile manufacturers. The relationship of these a couple of companies gives them the most beneficial support and edge in all facets of their operations i.at the. Sales Parts Products and services and Assembling.
About GM Global Vehicle Corp. NYSE- GM the earths largest automaker has been the global industry revenue leader since 1931. Founded in 1908 GM currently employs about 321500 people around the world. They have manufacturing operations with 32 countries as well as vehicles are sold with 200 countries. GMs motor vehicle brands are Buick Rolls royce Chevrolet GMC Holden HUMMER Oldsmobile Opel Pontiac Saab Saturn and Vauxhall. In a few countries the Game master distribution network likewise markets vehicles constructed by GM Daewoo Isuzu Subaru in addition to Suzuki
Brief History of GM Motors in Nigeria
1920 space Started as a Corporation called Miller Friends Nigeria Limited which imported cars in to West Africa
1927 – Began importing completely set up Bedford commercial vehicles directly into Nigeria.
1929 – Became the Engines Department of after that UAC now known as UACN Plc
1931 — Name changed in order to Niger Motors Limited. Extended importing built cars.
1949 – Business Vehicles were delivered in as increase unit packs that contained partially assembled chassis for two autos in one pack and the wheels in the subsequent pack to be constructed locally.
1959 – Recognized Nigerias First Vehicle Assembly Plant at Apapa. This company assembled the popular Bedford Vans of various models.
1965 space The Assembly Vegetable was renamed Federated Engines Industries Then commonly known as FMI and the submitting arm remained Niger Motors.
1979 – FMI started the assembly of pickup trucks from completely knocked down CRD elements.
1980 – The Federal Government accorded FMI the Progressive Vehicle Manufacturer reputation under the Approved Individual Scheme. This nomenclature ended up being attest to its excessive standard and quality products at that time. FMI and Niger Motors ended up converted into divisions connected with UACN Plc.
1991 – UACN Plc and General Motors Corporation of USA incorporated GM Nigeria Constrained as a Joint Venture Firm. The Assets of FMI and Niger Motors were being then transferred to General motors Nigeria Limited. Vision
For being number one in the commercial portion of the automotive sector by providing exceptional value to our customers. Quest
To provide automotive products of such quality as to enable our clients enjoy superior worth while delighting other stakeholders
Development and Address
GM Nigeria Limited is included in Nigeria under the Businesses Allied Matters Act 1990 as being a private limited liability company along with domiciled in Nigeria. The tackle of its registered workplace is-31 Mobolaji Velupe Street Oregun Ikeja Lagos .
Principal Activities
The principal activities from the company are- construction of SKD Semi Knocked Down motor pieces to produce medium and high commercial trucks importation regarding FBU Fully Built Unit pick-ups marketing and distribution of vehicles via its network or even branches and merchants nationwide. The company provides product support for parts and service with its Oregun plant Vent Harcourt branch Abuja branch and through its a lot of Parts and companies dealers. The company is also involved in provision of technical training for staff members dealers and navy customers personnel.
The companys product range includes Isuzu Mild medium and heavy professional vehicles all with several body applications.
Shareholding Of Gm Nigeria Ltd
According to the sign-up of members from 31st December 3 years ago the following shareholders with the company held greater than 10 of the capital released shared capital with the company-
Shareholder
Variety of Shares
Percentage Placed
UAC of Nigeria Plc
72000000
62
General Motors USA
Thirty seven000000
Thirty
Staff of General motors motors Nigeria1200000010
Origin financial statement GM motors 2007
1.2 STATEMENT From the PROBLEM
Serious nations efforts towards the growth and development of the automotive industry in Nigeria took place during the early 1970s with original joint venture agreements in between Peugeot and Volkswagen organizations. By 2001 there was clearly over 20 various enterprises manufacturing different kinds of vehicles from fishing boats to trucks such as motorcycles and bicycles automobiles in Nigeria. The proportions utilization of the majority of these lenders is however small largely due to the steeply-priced importing the components required to assemble vehicles non government patronage and very poor capital base connected with some of these organizations. Because of the introduction of the policy of bank debt consolidation a lot of Nigeria feels that this banking sector will discover to the end with this problem. But to the contrary Nigeria roads are plagued by imported second hand vehicle many as old while 10years as the country can be an attractive dumping ground for everyone kinds of toxic throw away while a lot of auto companies in Nigeria winding up. Hence this study is sets to examine this impact of financial institution consolidation on car financing in Nigeria.
This OBJECTIVES OF THE Analyze
This study sets over to- To establish the effects of bank consolidation with capital provision for that automobile sector with Nigeria. To provide a research focused framework for the development of very good understanding of the basic aspects and importance of financial institution consolidation as it has an effect on automotive industry in every economy. To determine the natural relationship between traditional bank consolidation and cash provision for the motor vehicle industry Determine the actual resent increase financial declaration of GM power generators and the working capital accessible for the industry
RESEARCH Issues
The following Research Concerns will thus guild this research- In what way does your banker consolidation affect money for the automotive marketplace in Nigeria What are the gains that the automotive market has derive from bank consolidation exercise As to the extent does Banking institutions consolidation provide a vehicle for automotive industry survival in a powerful business environment About what extent does lender consolidation enhance growth in the automotive sectors To what extent does the resultant impact of banks debt consolidation increase the market prospective of the automotive business
STATEMENT OF Concepts
The following stated study hypotheses will guild these studies-
HYPOTHESIS 1
Ho- Theres no significant impact involving bank consolidation and capital provision for the automotive industry inside Nigeria.
H1- There is a significant impact of bank loan consolidation and capital provision for the automotive marketplace in Nigeria.
HYPOTHESIS 3
Ho- Banks consolidation do not provides a vehicle pertaining to automotive industry success and growth inside a dynamic business environment.
H1- Banks consolidation offers a vehicle for auto industry survival in a dynamic business setting.
HYPOTHESIS 3
H0- The result banks mergers does not raise the market potential from the automotive industry
H1- The consequence of banks merging increases the market prospective of the automotive industry
1.6SIGNIFICANCE OF THE Analyze
The research is significant inside following ways- For starters it will help investors within the automobile industry to be able to appropriate the options provided by the consolidation exercise in that distinct sector.
Secondly its going to further assist business people to understand the significance of consolidation involving banks to cash provision and finally it is going to serve as useful way to obtain material for analysts and students.
A single.7 THE SCOPEDELIMITATION In the STUDY
This Study is going to be limited to Sixty a single staffs of Game master motor Nigeria Ltd. It will insures the funding in the automotive industry within Nigeria.
DELIMITATION OF THE STUDY
The investigation only looked at the impact of lender consolidation on the car industry. The population in the study covers only the staff of Game master motors Ltd Oregun Lagos. Therefore this research may not be generalized.
Because researcher was the only real interviewer and guitar of this study investigator bias may be possible in most of the interpretations. Though the researcher worked hard to keep off any personal views the possibility of subjectivity may still be found.
Also it is possible that will respondentsdidnt give accurate information about their operations within other to maintain several level of social self-respect. Human Resources manager from the organization also had to answer interview queries from the researcher. This kind of provided a certain amount of uncomfortableness and uncertainty as they was worried thathe might be judged by his responses. And finally the dearth of books materials in the car sector also would have been a major challenge
Breakdown of Findings
This work evaluated the impacts involving banks consolidation upon automotive industry loans using G.Meters Motor Ltd as a research study. Sixty copies regarding questionnaires were allocated fifty one ended up returned giving 85 reply rate. The results in the findings show that- relief have provided a vehicle for automotive industry tactical and growth in a dynamic business environment.
Once more automotive industry may seem to grow due to finance institutions consolidation that can give huge capital qualification in case of expansion through new products development or perhaps acquisition of small car companies and this is commonly a strategy to form world-wide alliances designed to monopolize and develop the brand image as soon as merger occur and get in some cases political power. Furthermore banks combination provides a vehicle pertaining to automotive industrys corporate survival and growth in an engaged financial environment as it boosts the strength regarding automotive industry therefore it enhances vehicle industrys financial capacity. Also the results indicated that banks merger gives economies of range and achieve some form of synergy for the automotive market and the resultant impression of banks combination increases the market prospective of the automotive market.
The research also said banks consolidation result in a higher market price and better earnings per talk about coupled with improvements in the stability though thoughts and opinions is divided as to whether the actual dividend before and after automotive industry alliances cannot be preserved after the consolidation to enable the market price of this automotives stock to be set up.
Banks consolidation seems to increase corporate electrical power and improve market share in some cases resulting in a higher price earning ratio. The work also showed that bank consolidation aids the particular automotive industry with financing that would not otherwise be possible to get which helps to achieve several synergistic effect without having strong banks economic capital base.
In addition revealed by the study is the fact that banks Loan consolidation brings about adverse car industry financial lasting effects because the awaited benefits did not work out as planned for expected charge reductions were not forthcoming hence it should end in higher earnings or maybe improve its steadiness. Furthermore the findings showed that banks combination is vested in auto industry ability to foster growth and the resulting profitability which will rather be difficult and nearly be impossible without having banks strong cap
Conclusion
Nigerians automobile industry is one of the continents fastest increasing sectors but it is deficient in the necessary local technological innovation and finance to completely harness its likely and contribute to countrywide growth and development. This state of affairs has ensured in which investing in the segment has become the preserve involving just a few foreign organizations in the automobile field largely based outside of the continent. Bank Consolidation introduced in Nigeria with 2005 is an appearance of strong wish of Nigeria government to reinforce a tool for enhancing consumer banking efficiency size along with developmental roles in their own economy. It is essential to know that this exercising has assisted this automaker industry to lift capital that may be call for in times of boom along with depression and prosperous entry into products market as well as in to new geographical markets in Nigeria. The primary function of corporate entities has been to increase the financial in addition to operational strength. Banking institutions consolidation has helped in playing important tasks of supporting the actual sector like car industry in a international context hence banks have remained a different phenomenon in capital big projects inside automotive industry from the corporate business world.
Beyond your capital provision the automobile sector in Nigeria has experienced a lot significantly neglect than some other sectors Abiodun 2008. Within seeking to achieve success in this sector vigorous efforts should be made to table some of this factors which are known to include hindered achievement on this sector in the past similar to power local information policy and stops on the importation of cars and trucks which can be locally assembled here. Effort should be built to sustain this little improvement that has been recorded in this sector as a consequence of bank consolidation.
RECOMMENDATION
Based on the findings from your study and the facts at the disposal of the researchers these recommendations are made Frequent and study review of the actual automotive partscomponents development market in Nigeria by the proper authorities Government has most likely furnished incentive measures to be able to encourage the local auto makers for being sure compliance with approved local programmes The proper of inspection along with other quality assurance routines in factories slots and roads inside pursuance of minimum common of automobile with Nigeria Roads by the proper authorities Regular evaluate of the pricing structure and excellence of the products of the set up plants to ensure intercontinental competitiveness Forecasting the particular demand and supply patterns for assorted types of automotive vehicles produced in Nigeria and the simple raw material demands by the appropriate experts The automobile sector must liaise with relevant organisations charged with the production of raw materials such as sheet steel alloy and special steel and make sure can be acquired when needed
Finally Your Nigerian government as a matter of desperation should articulate guidelines that can promote the development of local technology. Essential technical capacities that ought to include discouraging imports associated with completely built up devices providing incentives to be able to local assemblers to increase community content in production tax reduction and subsidies and rules to ensure local content in varying rates.
Taxie Note- Any categorized database comprising the patent data utilised in developing some of the statistics below is available free of charge upon request by sending an E-mail for you to with -mem-resistor patent database- in the title.
Introduction
Over the past Four decades semiconductor electronics has been powered by Moores Law which predicts an exponential reduction in the size of transistors as time passes providing more performance for electronic devices in less cost. Nevertheless due to physical limitations of scalability and manufacturing cost Moores Law cant continue forever plus the optimization of standard silicon transistors will inevitably ended. The Semiconductor Industry Roadmap forecasts further developments in the next few years yet past 2012 the way forward for electronics isbeginning to appearuncertain.