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A car ownership profit pool

You run the case. Read the prompt, answer questions from the notes below, and share data only when the candidate asks for it or gets stuck. Score at the end.

Case timer

00:00

Target length:

1. Read the prompt aloud

Read it slowly, then pause. Let the candidate ask questions before they structure.

In a fictional country, the car ownership industry has five activities. Using the table below (USD billions per year, illustrative figures, not real data), work out the profit of each activity and compare each activity's share of profit with its share of revenue.

The prompt refers to Exhibit 1. After reading it, say: "Open Exhibit 1 now."

2. Answers to clarifying questions

This case has no scripted clarifying answers. Answer from the prompt, and say "assume what you think is reasonable" if the prompt does not cover it.

3. A model structure

Compare the candidate's structure with this one. A different split can be just as good if it is clean and fits the problem.

Profit pool = revenue x margin, for each activity
- Profit of each activity
- Share of total revenue
- Share of total profit
- Key: Compare the two shares, activity by activity

Exhibit 1

The prompt uses this exhibit, so the candidate opens it right after you read the prompt ("Show exhibit 1" on their screen).

Car ownership in a fictional country: revenue and margin by activity (illustrative)(USD billions per year, margins in percent)

Car ownership in a fictional country: revenue and margin by activity (illustrative)
Activity	Revenue (USD billions)	Operating margin (percent)	Operating profit (USD billions)
Making and selling new cars	400	4	16
Selling used cars	160	5	8
Car loans and leasing	60	20	12
Car insurance	100	8	8
Parts, service and repair	120	10	12

So-what

New cars bring the most revenue but a much smaller share of profit. Financing and after-sales punch above their weight.

4. The working, step by step

Each step shows how a strong candidate works it out. Share a new fact from it only when the candidate asks or is stuck, and let them do the math: the result in the dark box is what they should reach.

Step 1: Profit of new cars
What a strong candidate does: Revenue 400 times a 4 percent margin.
New car profit (USD billions): 400 × 0.04 = 16
Step 2: Total profit
What a strong candidate does: Add the profit of all five activities.
Total profit pool (USD billions): 16 + 8 + 12 + 8 + 12 = 56
Step 3: Total revenue
What a strong candidate does: Add the revenue of all five activities.
Total revenue (USD billions): 400 + 160 + 60 + 100 + 120 = 840
Step 4: New cars: share of revenue
What a strong candidate does: 400 out of 840.
New cars, share of revenue (percent): 400 ÷ 840 × 100 = 47.62
Step 5: New cars: share of profit
What a strong candidate does: 16 out of 56.
New cars, share of profit (percent): 16 ÷ 56 × 100 = 28.57
Step 6: Loans: share of revenue
What a strong candidate does: 60 out of 840.
Loans, share of revenue (percent): 60 ÷ 840 × 100 = 7.14
Step 7: Loans: share of profit
What a strong candidate does: 12 out of 56.
Loans, share of profit (percent): 12 ÷ 56 × 100 = 21.43

The recommendation to listen for

At the end, say: "The CEO walks in. What is your recommendation?"

New cars hold about a 48 percent share of the industry's revenue but only about 29 percent of its USD 56 billion profit pool, because their margin is only 4 percent. Loans and leasing are the opposite: about 7 percent of revenue but about 21 percent of profit, since loans earn about a 20 percent margin. So a carmaker that wants more profit should ask whether it can win more of the financing and after-sales activity, not only sell more cars. The risk is that these margins are illustrative, and loans need a large balance sheet, so compare return on capital as well as margin. As a next step, check real figures for the country in the case.

Risks a strong answer names: These margins are illustrative. Check real figures for the country in the case.; Some activities need much more capital than others (loans need a large balance sheet), so compare return on capital as well as margin..

Score the candidate

Score each criterion from 1 to 5. A 2 or a 4 sits between the descriptions.

Structuring

1: No clear structure, or a memorized framework that does not fit the problem.
3: A sensible structure, but with some overlap, a gap, or no clear priority.
5: A structure built for this problem, with no overlap and no gaps, a stated hypothesis, and a clear first step.

Math

1: Frequent errors, no units, or needed heavy help to finish.
3: Right answers but slow or messy working, or one error caught late.
5: Accurate and clearly narrated, with units, a sense check, and what the number means.

Exhibit reading

1: Read the chart aloud without finding the number that matters.
3: Found the key number but gave only part of the so-what.
5: Pulled the right number quickly and said what it means for the case.

Synthesis

1: Summarized what was done, with no clear answer.
3: Gave an answer, but with weak reasons or no next step.
5: Answer first, then two or three reasons with numbers, the main risk, and next steps.

Communication

1: Hard to follow: long silences, no signposting.
3: Clear most of the time, with some rambling.
5: Calm and concise, signposted each step, and checked in with the interviewer.

Total

0 out of 25

Score all five criteria to see the band and the feedback template.