Hayes Enjoys a Well-Established Position as a Supplier to the Automobile

question 34

Essay

Hayes enjoys a well-established position as a supplier to the automobile industry. The firm supplied wheels to the Model T Ford. Today, Hayes is betting on a new product, fabricated aluminum wheels, which weigh up to 20 percent less than cast aluminum wheels and 40 percent less than steel ones. Hayes has signed contracts worth $50 million for the new wheels-mostly for use in spare tires-with DaimlerChrysler, Ford, General Motors, and BMW. Drawing on the industrial goods classification scheme, how would you classify the aluminum wheels? Sketch out the critical buying motives that organizations like DaimlerChrysler would emphasize in evaluating the wheels and explore Hayes' associated marketing strategy implications.

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Definitions:

Put/Call Ratio

A technical indicator that shows the trading volume of put options compared to call options, often used to gauge market sentiment.

Bullish Signal

An indication in the stock market suggesting that the price of an asset is likely to rise.

Indexed Funds

Mutual funds or exchange-traded funds (ETFs) designed to replicate and track the components of a market index, such as the S&P 500.

Mutual Fund Industry

The sector of the financial services industry that is involved in managing portfolios of securities, including stocks and bonds, pooled from individual investors.