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  • December 1995 (Revised January 2008)
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Lenzing AG: Expanding in Indonesia

By: Debora L. Spar
  • Format:Print
  • | Language:Vietnamese
  • | Pages:23
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Abstract

In 1994, Lenzing AG, the world's largest rayon manufacturer, is deciding whether to expand production in South Pacific Viscose, its Indonesian subsidiary. Indonesia is a booming market for rayon, but management still has some concerns about the expansion. First, for the plant to remain successful, Lenzing's downstream customers--textile producers--must also remain in Indonesia. Second, despite being located in an area of tropical forests, the Indonesian plant has no local access to wood pulp, its most critical input. Finally, with the expansion, Lenzing would be increasing its exposure in a country that remains politically and economically uncertain.

Keywords

Competition; Production; Expansion; Logistics; Manufacturing Industry; Indonesia

Citation

Spar, Debora L., Lygeia Ricciardi, and Laura Bures. "Lenzing AG: Expanding in Indonesia." Harvard Business School Case 796-099, December 1995. (Revised January 2008.)
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About The Author

Debora L. Spar

General Management
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