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CEMEX - Global Competition in a Local Business

            A global strategy was very important to Cemex. I believe it was very important for Cemex to expand to other regional markets such as Europe and Asia and I agree with their strategy. Cemex was stationed in Mexico, which had frequent economic concerns. When Cemex attempted to enter the United States through exports, American cement producers complained about dumping against Cemex. I believe this forced Cemex to search for other means of global sales.
             Although it was difficult to transport cement to far distances, Cemex agreed that it needed to enter Europe and Asia, specifically Spain and China. Cement is a global business, but the cement markets tend to be centralized, and it would have been difficult for Cemex to run operations from Mexico so it would need to set up plants overseas. China was the largest producer and consumer of cement and China is not close to Mexico. When the anti-dumping ruling emerged from US cement manufacturers, it made Cemex realize that "the US was not the whole world," explained Hector Medina, VP for Planning and Finance.
             Cemex began investing in its foreign countries through acquisitions when it acquired the two largest Spanish cement companies. Cemex proclaimed that it was very important for them to go to Europe to counter their competitor's, Holderbank's, position in Mexico. Cemex began investing in Asia in the late 1990s, through exports and investments in "floating silos" to store and supply cement where customers needed it.
             The advantages outweigh the disadvantages for Cemex's global expansion. The advantages to foreign expansion for Cemex was that it could now compete with its competitors, Holderbank, Lafarge and Italcementi. Those companies had already gone global and Cemex knew it had to remain close in order to compete globally. Another advantage to a global presence was the fact that many European countries and Asian countries were less developed and the growth potential was greater there, versus Mexico and the United States.

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