Rolls Royce SWOT Analysis
Rolls Royce SWOT Analysis Profile
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Strengths + Opportunities = 17
Threats + Weaknesses = 10
Rolls-Royce has recently with Warren East published a number of statements of confidence, despite the 1st half 2015 results not being in line with previous communications.
This approach to communication has led the analysis that the new management is looking at a significantly different strategy, including a break up.
Having been part of the thinking and strategy development in Rolls-Royce and seeing the consistency of the Corporate Development team, and the assertions that the new CEO brings which is focus on Operational Execution and Pace. Reinforcing the strategy is solid, and that at this time whilst a review of the strategy will be undertaken, I see no reasons for massive change.
The competitive positioning of Rolls-Royce is better than it could have been, and this focus on the delivery of existing business, with an order book which is very healthy - based on good Commercial Aerospace sales, and steady Defence and Nuclear business should see Rolls-Royce consolidate over the next two years and potentially become more powerful in the market.
Certainly acquisitions are not off the table, as we have seen in 2011 the acquisition of Tognum, which has led to some strength in the last couple of years, and with further diversification options in the power systems segment - with a much stronger Land business to compliment the Marine business.
Growth will still be a question, and whilst Civil Aerospace needs to make some decisions - investment in a new A380-NEO engine, or a single aisle engine in the near term - It is unlikely that both can be achieved with £1bn plus for each new engine development. … A history of overcoming weaknesses makes it difficult for other firms to exploit their difficulties. Maintaining strengths can help maintain high profits and low costs.
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