How does everyone feel about some of the mergers (although some are more correctly called take-overs) that are going on right now? Some big ones have been going on in the petro-chemical industry, like BPAmoco taking over ARCO, but I see some new ones from other business sectors in the news nearly every week. Are these moves good for the consumer? Are they good for the industry? How will they affect competition? Will the concept of supply-and-demand be changed?
I doubt the Giant Oil co. mergers will have much affect on us as consumers.They all eat at each others tables anyway.Especially when it comes to dealing with the Texas Railroad Commision and other regulatory agencys.(RR Com. regulates oilandgas industry here,go figure)It IS a little disconcerting to see Standard gathering in the wayward children again though,aren’t they the ones that inspired the anti-trust movement?An example closer to home and seemingly trivial was a few years back when Borden and some others tried to take on FritoLay. I was working in a related field and watched it happen and it had a direct impact on my career. Frito had about 60% of the snackfood market the 40% left was divided up between a lot of others with no one having much more than 10%. I designed the bags so had plenty of business. Borden(and others) began buying up smaller regional manufacturers mostly to get them out of the market, sometimes to use their facilities. Frito began to buy them so Borden couldn’t. A few of the larger ones merged. My business slumped.One Borden bag instead of one Joe’s,one fred’s etc. Borden failed, we wound up with Frto Lay bigger than ever. A few big companies now dividing the smaller remaing market. Less choice, a lot of small owners out of business purely from competition ,and less jobs in the industry.
Mine one of them. Ask, is Walmart good for your local community? Ask the consumer.Ask MomnPop.
I think the big takeovers don’t affect the economy as much as many think. (Especially, around here.)
Recently Marathon got controlling interest of Ashland Oil’s Petroleum division. (They call it a “joint venture”, but Marathon owns more than 60% of it.) Also, Ashland Oil’s (now Ashland, Inc.) headquarters are relocating to northern Kentucky.
Many people in the area were predicting economic doom for the local economy, but the fact is that for the most part the petroleum employees are still working the same jobs for the same wage. As for the headquarters, that only accounts for about 150 jobs, and except for the executives many of them don’t get paid as much as the refinery employees who are staying.
The area may be losing a little prestige from having a Fortune 500 company in the area, but the economic impact should be minimal.
I’m one of the relatively few people who have lost their job due to all that has happened, but now I’m doing a job that I enjoy more, get more recognition for it, and get paid nearly as much as before. Living well is the best revenge.
Carpe hoc!