Tenaris SWOT & PESTLE Analysis

Strength

1. Global leader in steel pipes: Tenaris is a strong contender within the energy industry and has emerged as one of the world’s biggest suppliers of steel pipes for use within the industry. The company boasts of a capability to produce 6.9 million tons of steel pipes annually with operations spaced out between its manufacturing facilities located in 18 countries. The manufacturing units include 25 welded tube mills, 13 seamless rolling mills, 53 heat treatment lines, 103 premium threading lines and 4 electric steel units. The company has a strong service and distribution network spread out across 30 countries. in 2018, the company the majority of its sales (48%) occur within North America, followed by the Middle East and Africa region at 20%. South America closely follows by being responsible for 19% of the company’s overall sales.

2. Strong expertise in the oil and gas infrastructure sector: The company has established its presence in the industry with an operating history of more than 60 years, which translates into solid industrial know how. Over the years Tenaris has acquired and developed subsidiaries in more than 30 countries ensuring its global presence. The company has succeeded in fully consolidating it’s US and Canadian presence and is now focusing on improving service quality and customer support within the region. It has also expanded its operations by now offering its services in UAE, Guyana, Indonesia and Brazil. The unique customer integration strategy used by the company has helped to set it apart from its competitors. It has also served the company but helping in cost reduction and a simplified operating process. The company has developed a global network of pipe finishing, distribution and service facilities with a direct presence in most major oil and gas markets. In recent times, the company has forayed into taking up major gas development projects around the world. The gas production project undertaken in Vaca Muerra shale in Argentina is only one amongst many. The company has similar projects, including LNG expansions, on going in Qatar, India, Mozambique, Australia and Indonesia. It is also a strong supplier for several Middle East NOCs. A global network of research and development centres has also served the company well. The combination of a comprehensive knowledge of metallurgy and material behaviour with extensive field experience has allowed the company to work in increasingly challenging environments. The offshore projects taken up by the company, like that at Liza, are able to clearly highlight the competency of the company.

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Weakness

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Opportunity

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Threat

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Political

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Economic

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Social

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Technological

1. Application of digital, automation and machine learning technologies in manufacturing processes: Manufacturers are rapidly increasing their digital capabilities as this helps in improving product quality, efficiency of production and lower operating costs. The manufacturing industry has shown a rapid rise in spending on robotic systems with figures going from $11 billion in 2005 to an expected $67 billion by 2025. The key advantage of using such robotics is the automation and machine learning capabilities that they come equipped with. They prevent the machines from doing only repetitive tasks and instead enable them to achieve increasing autonomy. The manufacturers can thus achieve higher predictability and lower manufacturing times. This usage of digital, automation and machine learning technologies emerged as a mega trend in 2019 with a large number of existing manufacturing plants across companies joining the race to become digitally equipped. The year also saw many new projects being built already armed with the latest sensors, data, networks, analytics and cloud-based applications. Tenaris too has not remained immune to this trend as is shown through its TenarisBayCity plant in Texas. With a cost profile of $1.8 billion, the plant has digital included within its every section.

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Legal

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Environmental

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