Rio Tinto's Business Strategy

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Rio Tinto are an Australian and British company who have grown to be one of the world 's leaders in commodity production. This is accredited to a various mergers and acquisitions that have occurred since its 1873 founding1. Their business activities span 35,000 employees in 35 countries across six continents, concentrated in Australia and Canada1. With headquarters located in London and Melbourne, they are dually listed on the London Stock Exchange and the Australian Securities Exchange1, with an approximate net-present value of $84 billion2. The primary business activities of the company are mineral extraction although they also have noteworthy operations in refinery. Specifically, they have five key operational areas: Aluminum1 • Considered …show more content…

• As Aluminium is “one of the world 's most versatile and environmentally friendly materials,”1 requiring less energy to manufacture and transport goods, it is becoming increasingly used in car production. Rio Tinto should capitalise on this by investing in sites and developing partnerships in key locations where it could be a direct source to car manufacturers. • Another suggestion is to maintain a diversified global portfolio, limiting reliance on Asian trade demand, specifically China, to decrease the risk this demand may decrease8. This may mean limiting production away from Australia and towards other countries, particularly underdeveloped nations, including Peru, and Guinea; where the company has access to a mine but has yet to begin production8. In doing so, it would enable further low cost production and low cost curve positions. • To further maintain diversity, the company should seek to expand production of other materials. This has recently drawn interest as the company have begun exploration projects in the United States and Indonesia, for Nickel, a commodity it currently does not produce9, to limit sensitivity to its materials should prices

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