Siemens VDO Automotive Corp. does business in a dozen countries in Western Europe. Traditionally, chief financial officer Ashoka Achuthan had to oversee budgets that allowed for 12 different currencies. Sales forecasts for Greece meant converting dollars into drachmas. Projections for France meant changing dollars into francs. At year's end, sales figures and results had to be converted into deutsche marks from dollars and sent to the Munich headquarters of its parent company, Siemens VDO Automotive AG.
But not anymore - to Achuthan's great relief.
"Our life has been made much easier in a number of ways," says the Bombay native, who oversees the financial and administrative functions for the $9.1 billion company from its headquarters outside of Detroit. "In one fell swoop, all of that was eliminated. It was almost like we got a magic currency."
Or, by its official name, the euro - the common money for most of the countries of Western Europe (save Britain, Denmark, and Sweden). It's four years old this spring, and just one year into mandatory usage, but it seems to have worked so well in such a short time that hardly anyone can complain. Yes, there are some minor nits to pick, like a suspicion that some prices increased when restaurateurs and shop owners rounded up when they converted from local currencies. And banks, which have lost billions in foreign exchange fees, probably aren't too happy.
But, say consultants and business people, that's about it.
"The overall feeling of doing business in Europe is different because of the euro," says Bob Uhler, the chief executive officer for MWH Global, a global engineering and construction company with some two dozen European offices. "There are so many things you don't have to worry as much about, like volatility of exchange rates. It has standardized the risks of doing business in 12 different countries."