Research On Countermeasures To Vertical Integration Of Steel Industry Of China

Affected by the global financial crisis, until now, China's steel industry has been suffering unprecedentedly.At present, our steel industry is facing more difficulties, such as large-scale cut, industry-wide losses, inventory increases and so on. To compensate for such deficiencies, and to enhance our own competitiveness as well as the structure of industry chain in steel industry, integrating and restructuring should be adopted to achieve our resources optimum allocation and improve the status for our steel enterprises in the international market. However, the blind integration might bring about the homogenization of the industry structure and the continued loss of core competitiveness.Therefore, the most important question is how to achieve the goal of optimal integration. We should concentrate on the weaknesses and put the target on the resources industry upstream together with customer downstream in the integration to improve our core competitiveness.First of all, the thesis elaborates the background knowledge and basic theory of vertical integration. Subsequently, the thesis analyses the necessity for vertical integration in our steel industry. According to the cause of the plight in horizontal merge and the motivation of vertical integration, it is suggested that our steel industry should put the target on vertical integration. Since only when we control the end of the industrial chain can we effectively control the strategic resources and stabilize customer relationships, so as to enhance our competitiveness.Then, analyses the experience and revelation from the successful business case in China's steel industry. Finally, based on the case study, explores the mode selection in vertical integration of our steel industry and proposes the integration routing for our steel industry according to Porter's value chain analysis, so as to enhance the crisis response capacity and international competitiveness in the steel industry.