Last time we had a look at the detailed SWOT analysis of Shell, an Anglo Dutch-based multinational oil and gas company. This time we will dive deep into the SWOT analysis of TotalEnergies and its working.
TotalEnergies is a company that produces and markets fuels, natural gas and electricity. Total Energies was created in the year 1924 with an ambition to enable France to play a key role in the manufacturing of great gas and oil exploration.
TotalEnergies’s efforts in marketing have helped them a lot. Marketing helps in achieving the desires and preferences of the target audience. Today every other company is using digital marketing, hence it has become a very important and essential skill to learn. You can check our Free MasterClass on Digital Marketing 101 by Karan Shah, the founder and CEO of IIDE.
Before we begin further with the SWOT analysis of TotalEnergies, let us discuss the company, what products it has to offer, its financials and its competitors.
About TotalEnergies
TotalEnergies is a French multinational integrated oil and gas company. The foundation of the company was laid back in 1924. Total is the seventh ‘supermajor’ oil company. Its businesses cover the entire oil and gas chain, crude oil and natural gas exploration, production to power generation, transportation, refining, petroleum products marketing, and international crude oil and product trade.
Gas and oil will play an important part in our lives for several decades as the technologies are not much developed as of now. As a major player in the energy industry TotalEnergies is aware of all the environmental risks of its operations. Their motive is to avoid or minimize these risks.
TotalEnergies also operates in India and has been active since the 1990s. Today they retail petrochemicals, market products and related services, and operate in renewable energies. They also lead community outreach initiatives in the country to promote training, road safety, access to energy and energy efficiency.
| Founder | Col. Ernest Mercier |
|---|---|
| Year Founded | 1924 |
| Origin | Paris, France |
| No. of Employees | 105,476 |
| Company Type | Public |
| Market Cap | $131.83 Billion (2021)) |
| Annual Revenue | $190 Billion (2021) |
| Net Income/ Profit | $15.5 Billion (2021) |
Products & Services by TotalEnergies
These are some of the products and services by Total:
- Fuel Stations
- Oil & gas exploration and production
- Natural gas and LNG trading and transportation
- Oil refining
- Chemicals
- Solar and biomass
Competitors of TotalEnergies
Here are some of the close competitors of TotalEnergies:
- OMV Group
- Chevron
- Air Liquide
- Cheniere Energy
- ENGIE
Let’s begin with the SWOT analysis of TotalEnergies.
SWOT analysis of TotalEnergies
SWOT can tell the areas that are holding you back, or about the loss if you don’t protect them. SWOT analysis is a tool that helps you analyze your company’s strengths, weaknesses, opportunities and threats.
Let’s start by discussing the strengths of TotalEnergies from the SWOT analysis of TotalEnergies.
Strengths of TotalEnergies
Strengths of Total are the points which helped Total to achieve success. Let’s have a look at the strengths:
- Brand Name & Reputation: Total Energies is a big company with 97+ years of experience and expertise. It has a stronghold over the market with operations in more than 130 countries and has maintained a high reputation over the years.
- Vertical Integration: TotalEnergies has successfully integrated its business operations vertically by engaging in exploration and production of natural gas, crude oil, etc. The upstream market, involving exploration and production. In the downstream market, it is in the marketing of refined products. They enjoy quality control and cost benefits as competitive advantages by vertical integration.
- Research and Development: TotalEnergies is continuously trying to improve its technology to decrease its carbon footprint and greenhouse emission while trying to extract more fuel with fewer efforts. TotalEnergies has many patents registered in their name and TotalEnergies has sustained investment in R&D. R&D helps in reducing expenditure and also gives competitive advantages.
- The emergence of Innovative Solutions: Recently, over 200 employees tackled complex issues related to wind power production and encouraged the emergence of innovative solutions.
- Sponsor of Automobile: TotalEnergies fuel and lubricants are officially recommended by prominent Renault, Nissan, and Mitsubishi Alliance members. Total Energies are also the official sponsor to provide fuel and lubricants to professional auto racing teams and the world’s car championships.
Weaknesses of TotalEnergies
Weaknesses are the areas where the company is lacking behind and needs improvement. Let’s have a look at the weaknesses of TotalEnergies:
- Increasing Debts: TotalEnergies has been experiencing a growing debt for the past few years. In FY 2015 the debt of the company was $129.08 Billion. In FY 2021 the debt of the company increased to $182.45 Billion. The increasing number of debt means increasing business risk and a subsequential amount of cash flow goes for payment of interest. This may increase the number of financial obligations in future.
- Shortage of Technical & Financial Resources: The business has experienced a shortage of technical and financial resources, which has reduced its ability to grow its service locally and globally.
- Strong Government Regulations and Policies: There are strong government rules and regulations that make operational efficiency low and create a hindrance in the working of a company.
- History of Environmental & Social Impacts: TotalEnergies has been criticized several times for increasing carbon emission globally. Also, the company is listed under the top 100 companies responsible for 0.9% of global emissions.
Opportunities for TotalEnergies
Opportunities refer to the chances of the progress of the company in future. Let’s have a look at the opportunities for Total Energies:
- New Acquisitions & Partnerships: TotalEnergies is always ahead in acquiring new opportunities and partnering with other nations for sustainable growth such as recently TotalEnergies partnered with Oman to develop low carbon natural gas projects.
(Charge Rapid with TotalEnergies’s EV)
- Being a Key Player in EV Segment: TotalEnergies is investing heavily to increase solar and wind power which will ultimately help to increase energy storage. TotalEnergies aim is to grab the opportunity to become one of the top five producers of renewable energy globally by 2030.
- Global Economic Growth: Due to the increase in the demand for energy and increasing dependency on fuels it can be an opportunity for TotalEnergies to grow in its field.
- The Demand-Supply Gap in India: The gap between demand and supply is widening in India. And it’s a great opportunity for TotalEnergies to take advantage of the excess demand in the market. By grabbing this opportunity TotalEnergies can increase its market hold.
Threats to TotalEnergies
Threats are the issues that can cause problems to the company in future. Let’s have a look at some of the threats to TotalEnergies:
- Lawsuits: The company can face lawsuits in various markets. As there are different laws and a continuous fluctuation of standards regarding products in those markets.
- Eco-friendly Fuel: If the dependability on renewable energy and non-conventional sources of energy increases then the company may face a large drawback as their products are not environment friendly.
- Climate Changes: As energy demand is increasing, carbon dioxide emission in production as well as upstream is expected to increase which needs to be under control for TotalEnergies. TotalEnergies has to find ways to reduce the emission of carbon dioxide or else TotalEnergies has faced increasing costs and strict regulation.
- Political Volatility: Oil and gas have been a very important subject of discussion between many countries for the last century. Energy demands and Production are always surrounded by politics. TotalEnergies has the disadvantage of becoming a victim of political development in the future.
- Intense Competition: Increased competitors’ technologies and profit stability have increased the competition in the industry over the last two years which has put downward pressure on not only profit but also sales.
This ends our precise SWOT analysis of TotalEnergies. Let us conclude our learning below.
To Conclude
TotalEnergies is a highly technologically advanced company in its field of work. They have proved that they are the greatest player as they survived the competitive market situations while going through the global pandemic in 2020.
TotalEnergies has to work upon the weaknesses mentioned above to continue being one of the supermajor companies in the industry. They have to foresee the upcoming threats to avoid any sort of harm to the company. Ignoring the threats can prove to be lethal in the upcoming years of the company.
One of the biggest reasons that TotalEnergies succeeded in its marketing strategies during the worst situations possibly imaginable, the global pandemic, as they successfully shifted to digital marketing on time.
The importance of digital media has grown exponentially over the past few decades. Businesses are very careful about their marketing, advertising, and social media presence. If you are a Marketing enthusiast the most important thing right now is to understand digital marketing. Check out IIDE’s 3 Month Advanced Online Digital Marketing Course if you want to learn more and improve your skills.
We hope this blog on the SWOT analysis of TotalEnergies has given you a good insight into the company’s strengths, weaknesses, opportunities and threats.
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