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Monza's sales in 2015 10,000 MACRS Schedule Monza's price $65,000 year 1 33% Monza Cost structure per car year 2 45% Body materials $11,000 year
| Monza's sales in 2015 | 10,000 | MACRS Schedule | |||
| Monza's price | $65,000 | year 1 | 33% | ||
| Monza Cost structure per car | year 2 | 45% | |||
| Body materials | $11,000 | year 3 | 15% | ||
| Engine | $4,000 | year 4 | 7% | ||
| Drivetrain | $6,000 | ||||
| Battery Pack | $20,000 | ||||
| Electronics | $5,000 | ||||
| Labor (allocated) | $4,000 | ||||
| Overhead (allocated) | $2,000 | ||||
| Consulting Fees | $50,000 | ||||
| Spenza Price | $80,000 | ||||
| Spenza Sales projections | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | ||
| Sales Volume | 7,000 | 7,000 | 4,000 | 4,000 | |
| Plant Investment | $250 Mil | ||||
| Alternative Land Use | $15 Mil | ||||
| Plant Capacity | 10,000 cars | ||||
| Project life | 4 years | ||||
| Percentage of Debt Financing | 50% | ||||
| Interest Rate | 7% | ||||
| Tax rate | 40% | ||||
| NWC as % of direct manufacturing costs | 5% | ||||
| Monza Sales Cannibalization | 1,000 cars | ||||
| Electricity cost | $0.07 per kWh | 70% of national average | |||
| Carbon Body Cost per Car | $14,000 | ||||
| Percentage of electricity | 80% | ||||
| Electricity used per car | |||||
| Other Spenza direct costs | |||||
| Body materials (other than electricity) | |||||
| Engine | $4,000 | ||||
| Drivetrain | $6,000 | ||||
| Battery Pack | $15,000 | ||||
| Electronics | $5,000 | ||||
| Solution | |||||
| Choosing Depreciation | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | ||
| Straight-Line depreciation | |||||
| MACRS Depreciation | |||||
| Your recommendation | |||||
| Projected Net Income | |||||
| Year 1 | Year 2 | Year 3 | Year 4 | ||
| Sales Volume | 7,000 | 7,000 | 4,000 | 4,000 | |
| Projected electricity cost (per kWh) | |||||
| Revenues | |||||
| Direct Costs | |||||
| Body materials (electricity only) | |||||
| Body materials (other than electricity) | |||||
| Engine | |||||
| Drivetrain | |||||
| Battery Pack | |||||
| Electronics | |||||
| Total Direct Costs | |||||
| Fixed Costs | |||||
| Labor | |||||
| Overheads | |||||
| Depreciation | |||||
| EBIT | |||||
| Interest | |||||
| EBT | |||||
| Taxes | |||||
| Net Income | |||||
| Projected FCF | |||||
| Monzas Lost Profit | |||||
| Volume | 1,000 cars | ||||
| Price | $65,000 | ||||
| Direct Costs (per car) | |||||
| Lost Profit (After-Tax) | |||||
| OCF | |||||
| CapEx | |||||
| Investment in NWC | |||||
| Opportunity Costs | |||||
| Alternative Land Use | |||||
| Lost Profit from Cannibalized Sales | |||||
| FCF | |||||
| WACC (Next Tab) | |||||
| NPV | |||||
| IRR | |||||
| Six Scenarios | |||||
| 2015 | 2016 | 2017 | 2018 | ||
| Reference | $0.0707 | $0.0721 | $0.0724 | $0.0718 | |
| High Oil Price | $0.0715 | $0.0721 | $0.0726 | $0.0724 | |
| Low Oil Price | $0.0705 | $0.0722 | $0.0725 | $0.0721 | |
| High Oil and Gas Resource Availability | $0.0699 | $0.0710 | $0.0715 | $0.0706 | |
| High Economic Growth | $0.0705 | $0.0721 | $0.0719 | $0.0717 | |
| Low Economic Growth | $0.0710 | $0.0720 | $0.0715 | $0.0704 | |
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International Trade Finance
Authors: Tarsem Bhogal, Arun Trivedi
2nd Edition
303024542X, 9783030245429
