Question

ExxonMobil has had many years to improve their structure, and people need oil and gas. They need these products to maintain their homes, but also as a necessary function for their day to day lives. Without a company like ExxonMobil people would not be able to put fuel into their vehicles to go to work, or to go be a consumer of products. can you criticize?

 

Answer 1

While it is true that Exxon Mobil is in the business of oil and gas and since oil & gas is essential for running of basic functions which are needed for sustaining life, so it can appear that Exxon Mobil may have enough time to restructure and improve. However, the fact is that as per economic principles, if there is a sector which is lucrative because of consistent demand and high profitability, then it is most likely that there would be intense competition and new firms would try to enter that space and dislodge older firms.

So this leaves the incumbent firms much lesser time to improve their structure in order to maintain their profitability and competitiveness. So it is not entirely true that Exxon Mobil had many years to improve their structure rather they must have done fairly quickly and efficiently in order to remain competitive.