Growth limitations for aluminum wheels

A major producer of aluminum had a joint venture that made aluminum wheels for large trucks. Its JV partner sold these aluminum wheels as a part of its broader portfolio of wheels, including also steel wheels for trucks. The joint venture was profitable for both partners, but both were frustrated by limitations to growth under the JV structure. CRA was hired by the aluminum producer to help on a number of different tasks on this matter. We assessed the future market outlook for large truck wheels. We analyzed the role of other competitive suppliers on the limitations to growth for the JV. We then helped the client design a strategy to sell its JV ownership share to the other partner. As a part of this effort, we valued the business and suggested negotiations strategy to our client.