Valero industry overview

To remedy the alleged anticompetitive effects of the merger, the Proposed Order requires Respondents to divest the Ultramar Golden Eagle refinery located in Avon, California.

Valero Energy Corporation Porter Five Forces Analysis

The Commission conducted the investigation leading to the Complaint in collaboration with the Attorneys General of the States of California and Oregon. The Commission measures market concentration using the Herfindahl-Hirschman Index "HHI"which is calculated as the sum of the squares of the shares of all firms in the market.

Resolution of the Competitive Concerns A. The market exhibits characteristics that are conducive to coordinated interaction, including 1 homogenous product; 2 small number of market participants; 3 high concentration; 4 recognition by participants that individual output decisions impact the market; 5 difficult entry conditions that insulate the market from outside supply; 6 vertical integration that eliminates potential low-cost competitors and creates a finite and identifiable collusive group; and 7 industry practices and conditions that allow the collusive group to easily detect and punish cheating on the tacit agreement.

Access Denied

Porter Five Forces is a holistic strategy framework that took strategic decision away from just analyzing the present competition. Paragraph V provides for notification to the Commission in the event of any changes in the corporate Respondents.

The next closest refineries, located in the U. CARB 2 automotive gasoline meets the current Phase 2 specifications in effect since and is the only gasoline that can be sold to California gasoline consumers. Valero and Ultramar are the only major refiners in California with excess capacity above their direct marketing needs.

One of the lessons Valero Energy Corporation can learn from Wal-Mart and Nike is how these companies developed third party manufacturers whose business solely depends on them thus creating a scenario where these third party manufacturers have significantly less bargaining power compare to Wal-Mart and Nike.

The threat of a substitute product or service is high if it offers a value proposition that is uniquely different from present offerings of the industry.

CARB 2 automotive gasoline meets the current Phase 2 specifications in effect since and is the only gasoline that can be sold to California gasoline consumers.

Valero Energy Corporation Porter Five Forces Analysis

The merger increases the likelihood of coordinated interaction in Northern California by reducing the number of significant refiners in the market from five to four. The Commission has concluded that the merger is unlikely to reduce competition significantly in markets other than those alleged in the Complaint.

Other than the California refineries and one Washington refinery, no other refineries regularly produce CARB gasoline in significant quantities. This will be helpful in two ways.

The Commission's decision to issue the Complaint and enter into the Agreement Containing Consent Orders was made after an extensive investigation in which the Commission examined competition and the likely effects of the merger in the markets alleged in the Complaint and in several other markets, including markets for asphalt refining and pipeline transportation, and terminaling or marketing of gasoline or other fuels in sections of the country other than those alleged in the Complaint.

Valero and the acquirer will likely have different incentives than the integrated refiner-marketers and may be less willing to coordinate output decisions with the refiner-marketers. The analysis applied in each market generally follows the analysis set forth in the FTC and U.

The Agreement Containing Consent Orders contemplates that the Commission would issue the Complaint and enter the Proposed Order and the Hold Separate Order for the divestiture of certain assets described below.

Resolution of the Competitive Concerns A. Rivalry among the Existing Competitors If the rivalry among the existing players in an industry is intense then it will drive down prices and decrease the overall profitability of the industry. After thirty 30 days, the Commission will again review the Proposed Order and the comments received and will decide whether it should withdraw from the Proposed Order or make final the Proposed Order.

The next closest refineries, located in the U. By understanding the Porter Five Forces in great detail Valero Energy Corporation 's managers can shape those forces in their favor. The merger increases the likelihood of coordinated interaction in Northern California by reducing the number of significant refiners in the market from five to four.

One effect of the close integration between refining and marketing in California is that refiners outside the West Coast cannot easily find outlets for imported cargoes of CARB gasoline, since nearly all the outlets are controlled by incumbent refiner-marketers.

Valero Revamps Branded Station Design

A bulk supply market consists of firms that have the ability to deliver large quantities of gasoline on a regular and continuing basis, such as pipelines or local refineries.

The Commission will consider, inter alia, whether the acquirer has the business experience, technical judgment and available capital to continue to invest in the refinery in order to maintain CARB gasoline production even in the event of changing environmental regulation. Based on forecasted CARB 3 refining capacity, the proposed merger would result in a highly concentrated market, increasing concentration for the refining and bulk supply of CARB 3 gasoline by California and Washington refineries by more than points to an HHI level above 1, These unbranded marketers provide lower-cost competition to the branded refiner-marketers.

Valero Energy Corporation (VLO) Competitors - View direct and indirect business competitors for Valero Energy Corporation and all the companies you research at janettravellmd.com Petroleum Refining Overview Size of U.S.

industry Major refiners Petroleum products Basic petroleum economics Trends for crude oil & gasoline prices When do refiners make money?

Wilmington, CA Huntway 5, Valero 6, Simple. Valero Energy was not only named after a mission (the Mission San Antonio de Valero), it is on a mission to be the largest independent refiner in the US.

Valero churns out about 3 million barrels per day, refining low-cost residual oil and heavy crude into cleaner-burning, higher-margin products, including low Location: 1 VALERO WAY, SAN ANTONIO,TX.

Valero Charles City Ethanol Plant Quarry Road Charles City, IA ()main ()fax. Overview. Valero's Charles City ethanol plant is located near Charles City, Iowa, approximately 35 miles east of Mason City and miles south of Minneapolis.

The biorefinery sits on acres and started ethanol production in April Valero, headquartered in San Antonio, Texas, is an independent domestic refining company. The analysis applied in each market generally follows the analysis set forth in the FTC and U.S.

Dep't of Justice Horizontal Merger Guidelines () industry practices and conditions that allow the collusive group to easily detect and punish. Valero Energy Corporation Porter Five (5) Forces Analysis for Basic Materials Industry Threats of New Entrants New entrants in Oil & Gas Refining & Marketing brings innovation, new ways of doing things and put pressure on Valero Energy Corporation through lower pricing strategy, reducing costs, and providing new value propositions to the customers.

Valero Grabs DTN TABS for Rack Marketers Valero industry overview
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