According to Joint venture between BP and Mobil in Europe we observe from internal analysis of both companies as follows; BP is a major petroleum and petrochemicals group with operations in some 70 countries. In Europe, BP operates downstream which have European refineries with combined capacity of 760,000 barrels a day. Moreover, they plan to sell a refinery in France.
On the other hand, Mobil is major international energy company operating in over 100 countries. In Europe, Mobil has downstream operations in 22 countries. European refineries with combined capacity of 350,000 barrels a day.
BP has strength in term of Fuels while Mobil has core competency on Lubricant especially they emphasize on R&D of Lubricant. So, Mobil has been known as the quality brand. Moreover, B P are the cost leadership but they still get the low profit margin both fuels and refinery. However, Mobile is weaker in fuels /European market than BP.
As discuss earlier that the oil company try to achieve economy of scale in order to being survival. That's the point of decision making in join venture/Alliance between Mobile and BP. BP-Mobile also want to expand the customer based by leverage both tangible assets such as best knowledge, expertise and management and intangible assets such as refinery technology, skilled people. The cost saving can be illustrated by consolidation of assets which included refineries, depots and retails sites (shared service center) of both companies, together with pipelines, tankage, terminals, road tanker fleets and all other systems,, plant and equipment associated with the manufacture and distribution of oil products in Europe. Moreover, they combined offices and management terms and other service departments.
The result in improving productivity is in term of generating the distribution networks. Moreover, result in cost cutting that make them can complete competitors on selling...