Proposal for the Shanghai Future Bus Co. (SFBC)
Antoine Graham, Anthony Nobles, Louisa Rosario, Tracy Snipes, Trevor Waddell, and Danyelle Woodard
November 27, 2000
Table of Contents
I.
About our Company
3
II.
Project Objectives
4
III.
Financial Proposal
5
IV.
Managerial Structure for the Shanghai Future Bus Co.
6
V.
Environmental
7
VI.
Technology transfer and worker training
8
VII.
Conclusion
9
2
I. About our Company:
ADALT Corporation is an American fuel cell vehicle manufacturer founded in
1989. At the present, ADALT Corporation employs approximately 420 scientists,
engineers, technicians, and support staff. The Greensboro, NC U.S.A., headquarters is the
center of the research and development efforts. We have plants located throughout the
United States and South America for the production of fuel cell vehicles. ADALT’s
high-power, low-maintenance, state-of-the-art fuel cell equipped vehicles have proven to
be exceptionally reliable, efficient and economical in real world applications. More than
500 fuel cell vehicles have been delivered to individuals, corporations and government
agencies in thirty-eight states and twelve countries, and over 1000 vehicles around the
world – including cars, trucks, buses, and ice resurfacing machines.
The following team of ADALT executives will be at your disposal for discussion:
Antoine Graham, Financial Analyst
Anthony Nobles, Management Specialist
Louisa Rosario, Project Coordinator
Tracy Snipes, Technical Analyst
Trevor Waddell, Environmental Analyst
Danyelle Woodard, Project Coordinator
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II. Project Objectives
The purpose of this project is to design and manufacture fuel cell equipped buses, in
order to alleviate the serious air pollution in China’s Urban centers and to provide new
and promising technology.
Our company’s technological assets and year’s of experience in fuel cell bus
manufacturing include but are not limited to the following:
•
Corporate Research and Development Staff
•
Fuel Cell Manufacturing
•
Design, assembly, operation and maintenance of fuel cell vehicles
•
Extensive knowledge in public transportation, environmental regulations,
operations, etc. in U.S.
•
Comprehensive operation and technical training
II. FINANCIAL PROPOSAL
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Financial Details: The SBC is interested in forming a joint venture with a foreign
company. The foreign company (ADALT) will provide access to technology that will
enable SBC to independently produce fuel cells for their buses within five years.
The following are charts showing how equity and debt are split among investors.
Capital Breakdown:
Total Capital
Debt
Equity
30%
70%
•
30% total capital will be in equity, issued stocks. 70% will be comprised of debt,
borrowed from international banks, investment firms, or investors issued bonds.
Debt and Equity Breakdown:
Capital Breakdown
Foreign Debt
.
Foreign Equity
Domestic Debt
21%
21%
Domestic Equity
9%
49%
•
•
•
Shares of the Chinese company shall be no less than 51%
Shares of the foreign company shall be no less than 25% and no more than 49%
Request by the foreign company (ADALT) is 30% of total shares owned by
foreign company and 70% of total remaining shares owned by (SBC) domestic
company.
5
EXPECTED REVENUE STREAMS
KEY ASSUMPTIONS
• Total start-up cost is established (based on initial technology cost, licenses,
equipment, building, transportation, cost of salaries, etc.).
• Operating at full capacity in 2006
• Sales will steadily increase as bus production increases
• Expenses will level-off (maintenance of equipment, loan payment, etc.)
TOTAL START-UP COST est. (127 MILLI ON DOLLARS)
2001
2002
2003
2004
net
sates
10,800,000
21,600,000
32,400,000
43,200,000
2005
54,000,000
minus
30,100,000
28,700,000
26,200,000
25,000,000
21,200,000
expenses
----------------------------------------------------------------------------------------------------------------------------------------expected
revenue -19,300,000
-7,100,000
6,200,000
18,200,000
32,800,000
IV. Managerial Structure for the Shanghai Future Bus Co.
Due to China’s legal, economic, managerial, and political environment in joint
venture’s related to public transportation. We propose that the board of directors be
composed of 12 members:
Chief Executive Officer- president / CEO of the Shanghai Bus Co.
Chairman of the Board- Financial Advisor/ General Manager
Board of Directors: Department of Transportation Director, Environmental Advisor,
Chinese Union Leader, Legal Advisor of parent company, Loan Officer of Investing
Bank, Joint Venture manager, JV Financial Manager, Technology Technician, Training
Coordinator, JV Legal Advisor.
6
V. Environmental
Globalization in the market place has created an environment that requires
continual improvement. ADALT Corporation has incorporated an environmental
management system that is responsible for leading, planning, and controlling all activities
with special emphasis in environmental protection.
The responsibilities of ADALT’s Environmental Management System (EMS) include
the following:
•
Establish a comprehensive environmental-protection policy
•
Identify all government regulations and requirements that apply to the
organization’s processes, products, and/or services (controlling).
•
Establish organization-wide commitment to environmental protection
(organizing).
•
Incorporate environmental concerns in all levels of organizational planning
including strategic, operational, and procedural (planning).
•
Establish management processes for achieving performance benchmarks
(controlling).
•
Provide sufficient resources to ensure that performance benchmarks can be
achieved on a continual basis (leading).
•
Establish and maintain an effective emergency preparedness program
•
Assess organization’s environmental performance against all applicable
benchmarks and adjust as necessary (controlling).
•
Establish a review process for auditing the EMS and identifying opportunities for
improvement.
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•
Establish and maintain communication linkages with all stakeholders, internal and
external.
•
Promote the establishment of an EMS in contractors and suppliers.
Due to ADALT’s stringent Environmental Management/Control System, we have no
problems in complying with China’s Air Pollution Control Law.
VI. Technology transfer and worker training:
ADALT would send its top consultants into the Shanghai Bus Co. and to identify
current technology in use and what new technology we can provide in order to make this
joint venture successful. ADALT would send top Plant managers, Quality Assurance
Engineers, Mechanicals Engineers, Constructions Engineers, and Maintenance
technicians to assist with the training process. The trainers from ADALT would require
that each of the Chinese workers complete the training sessions. The training program
would last from 7 a.m. to 5 p.m. on Mondays, Wednesdays, and Fridays and from 8 a.m.
to 5 p.m. on Tuesdays and Thursdays. The Chinese workers will receive classroom
instructions and hands-on training. Each training session will take approximately 12
weeks. Supplemental will include on the job training (OJT). The Chinese workers
would be given incentives in completing one or more training programs.
VII. Conclusion
This joint venture will be in the best interest of the Chinese population who’s goal is a
cleaner environment. We will definitely have the best interest of your company in all
aspects of this joint venture including financial, environmental, employee satisfaction,
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and profitability. We hope that this joint venture will enable us to grow together to reach
a common goal. This joint venture will deliver a competitively priced fuel cell bus that
will meet the needs of the urban areas of China. Together in this joint venture will
achieve the goals to develop a striving market. The fuel cell buses will allow us to
combine our skills and expertise once your employees are efficiently trained. In all we
believe that the fuel cells buses market will definitely be successful. This market has
great potential for your company.
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