Transnational corporations

Question 1

What are the characteristics of TNCs?

Answer 1

Capitalist enterprises in more than one country.
Hierarchical organisation.
Headquarters, R and D in the home country.
Centres of production overseas.

Question 2

What happens to the structure of TNCs as they become more global?

Answer 2

Organisation more global.

Regional headquarters and some R and D will develop in the manufacturing areas.

Question 3

What are the top 3 TNCs in the world?

Answer 3

1. Wal-Mart - USA - retailing - $378.8 billion.
2. ExxonMobil - USA - oil/gas - $358.6 billion.
3. Royal Dutch Shell - UK - oil/gas - $355.8 billion.

Question 4

What is the primary process of a TNC?

Answer 4

Resource extraction.
Oil and gas.
E.g. Royal Dutch Shell.

Question 5

What is the secondary process of a TNC?

Answer 5

Manufacturing.

1. High-tech industries - computers.
2. Large-volume consumer goods - cars e.g. Ford.
3. Mass-produced consumer goods - cigarettes.

Question 6

What is the tertiary process of a TNC?

Answer 6

Service operations.
Banking/insurance.
Advertising.
E.g. AXA.

Question 7

Honda TNC mini case study.

Answer 7

Swindon, UK.
2008 - employed 4,000.
200,000 vehicles annually - European market.
Some exports to middle East, Africa, North America.
Recession 2008/2009 - laid off workers.
Plant closed for some periods.
Has geographical flexibility - can shift resources/production between global locations.