Many on Wall Street expected Schrempp to use his new-found liquidity to make an acquisition.
It is worth noting that Schrempp always saw auto manufacturing as a global business. In addition to establishing an important beachhead in the U.S., he wanted to do the same in Japan. Shortly before the Chrysler merger he concluded a deal with Mitsubishi to acquire a significant minority stake in their stock. Schrempp must have realized that Chrysler's earlier cooperation with Mitsubishi would pave the way to a three-way auto colossus, led by Daimler enz.
CHRYSLER'S GROWTH and SUCCESS in the 1990S
Merger was the furthest thing from peoples' minds at Chrysler in the 1990s. ased on the strong growth of market share in minivans and trucks, Chrysler had regained some of its market share losses and remained consistently profitable. Chrysler was particularly helped by changes in American taste: while all the ig Three were…… [Read More]
Daimler Chrysler Merger
hat was the stated rationale for the merger?
The potential benefits of the merger were roughly equal both sides of the two companies. First of all Chrysler had a significantly bigger presence in the North American market while Daimler-Benz had a much bigger presence in Europe. Therefore, both companies were eager for more market penetration in the others home-territory. However, the rationale extends far beyond the geographical market presence. At the time of the merger, both companies were profitable but were eager to expand in order to create a long-term orientation and be more competitive with the larger automotive manufactures.
Furthermore, the combined product mix would represent more of a full lineup than each on had separately. For example, Chrysler was more focused on lower cost cars and sport utility vehicles while Mercedes had deep penetration into the luxury market. Additionally, there were a large number…… [Read More]
Daimler-Chrysler- Case Study
Corporate marriages have become so problematic in recent times that it no longer generates a shocking response from the analysts at Wall Street if a merger fails. We witnessed some of the classic merger downfalls in 1990s when many large companies decided to merge their businesses mainly because of poor economic conditions. Because of these failures and the many stories surrounding rapid collapse of corporate marriages, the public along with Wall Street analysts more or less has stopped reacting to such news. Still, the news that Daimler-Chrysler merger was facing deep problems generated a massive response from Wall Street observers who were keenly anticipating some positive news. Everyone had believed that it was a 'merger of the equals' since both companies ranked very high in their respective areas of expertise.
Things should have worked out well because there were apparent no clash of interests. Daimler Benz was…… [Read More]
A Long and Tangled History
The Daimler car company, under various different names and throughout various configurations, has been around almost as long as the history of the automobile itself. It has seen good times -- including some very good times -- as well as some very troubled times. While Daimler, like any other company, has been to some extent purely at the mercy of chance and external forces, it has also risen and fallen a number of times because of the company's internal culture. This paper examines that organizational culture and how it has both helped and hindered the company during its recent history, relying primarily on the theoretical model of the cultural web. While "culture" is most accurately understood as an element of an integrated human community rather than a corporation (which includes elements of a wider human community but is much narrower in function and scope),…… [Read More]
Behavior einforcement Theory
Use of behavior modeling advocated for in reinforcement theory tends to increase employees' commitment to a job and ensure job satisfaction obbins S.P. & Judge T.A., 2011.
In the organization, this level of behavior modeling was disregarded thereby, failing to encourage team members and managers to participate meaningfully. The theory of reinforcement sees the behavior of employees as one that is conditioned by the immediate environment. A tendency to reinforce behavior will resort in its recurrence. The performance of the employees immediately following the merger was reduced productivity. The behavior was reinforced by the management team taking no appropriate action to discourage the tendency of even encourage the contrary.
According to the reinforcement theory, people will avoid getting something they do not want as well as feel motivated to work in order to get what they want obbins S.P. & Judge T.A., 2011.
The failure by Chrysler…… [Read More]
The EVMI initiative will push the supply chain even more rigorously, requiring even greater financial investment. EVMI as a technology is an opportunity; the challenge for Chrysler is to transform their supply chain into a support infrastructure that can fully make this opportunity realizable. Additional opportunities for the company include the continual improvement of their quality management and compliance systems so they will be able to exceed CAFE requirement and create alliances with the NTSA, EPA and California emissions boards (Campbell, 2007). For the EVMI project to gain any momentum it would need to have the support of these three governing bodies. For Chrysler to realize the potential of the EVMI initiative it must also seek to transform its new product introduction process into one that can capitalize on low costs (Ibusuki, 2005) while also embracing innovation. This organizationally will be a very significant challenge for the company yet one…… [Read More]
Chrysler, unlike Ford with its Focus, had no popular, fuel-efficient cars. In fact, even after the first government bailout, "Chrysler's big reveal at the International Auto Show was a new Jeep Grand Cherokee. Not what the government wants the company to be spending time and bailout money on" (Gap, 2009, Key Splash Creative). As GM was planning a new line of cars, and formulating a prospective electric car, the Volt. Chrysler remained out of touch.
Chrysler was the first company of the 'big three' Detroit automakers to go into bankruptcy. It was forced to respond to direct pressures from the Obama administration to do so, despite protests that Americans would never buy cars from such a financially-tainted company. Chrysler's current CEO, obert Nardelli said that he had been pulling the flagging company back together, and that "the privately held Chrysler was flush with cash and leaner than at any time…… [Read More]
Fiat / Chrysler -- Leadership - Teambuilding
The Chrysler merger with Fiat was met with skepticism and doubts when it was first proposed. Chrysler had just recently emerged from near bankruptcy -- saved by a U.S. government bailout -- and Fiat is a strong internationally respected corporation building cars, earth-moving machines, and more. The merging of Chrysler and Fiat was seen as having a greater opportunity for success than did the merger between Chrysler and Daimler-Benz, but still there were doubters in the industry. However, as of May, 2012, the blending together of the two companies (Fiat and Chrysler) has produced a profitable situation. This paper examines the cultures -- and leadership -- shown within the two companies, a strong combination that has allowed success to be achieved. The paper also critiques the leadership styles in the dynamics of this merger, and delves into the concept of teambuilding when two…… [Read More]
Thackery, John. "ybrid autos REV up: but will SUV-addicted buyers opt for an environmentally friendly car that saves on gas but commands a premium price?" Electronic Business: Automotive Electronics. Oct 2002 v28 i10 pp. 64(5)
Even before reading the article, "ybrid autos REV up" an informed consumer of the media should know that quite often automobile and electronics magazines are highly favorable of the industries they chronicle. The industry is essentially their 'bread and butter' of such magazines -- i.e. without cars, fancy car gadgets, and car aficiandos, there would be no audiences for such segmented magazines. The credentials of John Thackery, the article's author, are not immediately obvious, but the article's title "ybrid autos REV up: but will SUV-addicted buyers opt for an environmentally friendly car that saves on gas but commands a premium price?" suggests a highly positive slant is being given to the vehicles, for…… [Read More]
Because of its hip European style, its environmentally-conscious image, its fuel economy, and its novelty, the Smart Car will appeal to a large segment of American consumers.
Proposals for marketing the Smart Car in the United States:
The Smart Car will appeal mostly to consumers in urban and semi-suburban areas. Therefore, marketing should be targeted at that segment of the population.
I have no recommendations for product adaptations to the two-seater Smart Car. However, I strongly recommend that Daimler-Chrysler introduce the SUV model of the Smart Car because of the American obsession with the SUV. The SUV Smart Car will appeal to Americans who don't want the stigma of driving an SUV but who at the same time need the extra space.
The Smart Car will appeal to all ages and genders but will be best marketed toward well-educated consumers, college students, and persons of a liberal political philosophy.
The…… [Read More]
Yes, the merger may have been a good idea in the beginning and would have allowed both companies to form a considerable economy of scale, but only if they could work out their differences and be able to make the changes necessary. According to Lewin's model they never even got past the first age, therefore they were never able to make the changes in the first place. A merger requires that both companies "unfreeze" of their business model and other elements of their company. Unless they can get past the first age, they will not be able to get to the second and third stage of the change model. This one the key lessons that is learned by the failed merger of Daimler-Chrysler.
In 2007, the failed restructuring attempt led to the decision by Daimler AG to sell Chrysler to Cerberus Capital Management (Szczesny, 2007). One of the key reasons…… [Read More]
.. business performance and long-term economic success; the responsibility for the sparing use of our planet's resources and for maintaining an intact environment for present and future generations, and the responsibility for the people involved in or affected by our company's business activities and for society as a whole" ("Chrysler Group," Internet).
Currently, Daimler-Chrysler is headed by Dr. Dieter Zetsche, appointed in 1998 and until the year 2010. His leadership style is wholly based upon the company's "Integrity Code," being guideline... which defines limits to the activities of employees worldwide... And contains rules of conduct concerning international transactions, conflicts of interest, the issue of equality, the role of internal monitoring systems (and) the right to the fulfillment of statutory standards." As to the company's ethics, it currently adheres to the Sarbanes-Oxley Act "which is applicable to board members and other senior officers" within and without the company. Also, Daimler-Chrysler "acknowledges…… [Read More]
Porter's generic strategies began life as a matrix grid featuring low cost and differentiation strategies, which could either be mass market or niche in nature (QuickMBA, 2010). A fifth strategy, hybrid, has been hypothesized by some, noting that there are instances where a firm could be argued to practice some combination of differentiation and low cost.
The Swatch Watch has a differentiated strategy. While not a high end watch, it does have a strong brand, with a unique brand proposition.
The McDonalds Value Meal is essentially a hybrid. All McDonalds product is low cost by the definition of its industry, and the value meal accents the low cost element. However, McDonalds has a high level of differentiation within its industry. It has a healthy 20% net margin, which indicates that it does not follow a true cost leadership strategy -- it could cut prices quite a bit more…… [Read More]
Managing All Stakeholders in the Context of a Merger Process
Review of the Relevant Literature
Types of Mergers
Identifying All Stakeholders in a Given usiness
Strategic Market Factors Driving Merger Activity
Selection Process for Merger Candidates
Summary, Conclusion, and Recommendations
The Challenge of Managing All Stakeholders in the Context of a Merger Process
Mergers and acquisitions became central features of organizational life in the last part of the 20th century, particularly as organizations seek to establish and maintain competitiveness in an increasingly globalized economy (Nevaer & Deck, 1996). Mergers are generally described as being the formal joining or combining of two corporations or business (Prichett, 1987), although both the framework and the method of merger vary greatly. The reasons for mergers are different based on what a company is trying to accomplish. The acquiring firm may seek to eliminate a competitor; to increase its efficiency; to diversify its products, services,…… [Read More]
Additionally, aside financial resources, they also used their assets. The most relevant example in this sense is the selling of part of its interests in Mazda. It as such transformed its assets into liquidities -- the 20% shares in Mazda were converted into $540 million (Murphy) -- that better allowed them to pursue their innovation objectives.
The matter of technological innovation is not only a core focus of Ford's, but of all players within the American automobile industry. The reasons for the rivalry in terms of &D are numerous, the most outstanding however being constituted by the desire to attract and satisfy as many customers as possible, managing as such to increase organizational revenues. "&D efforts in the U.S. Auto industry are channeled into a variety of processes such as stamping, casting, machining, and assembling. Within the time-frame of our investigation, &D efforts had to embrace sudden changes in taste…… [Read More]
The last century has seen an increase in the level of international purchases which has been supported by the developments in transportation and technology. Goods can move faster than before with developments in logistics. The negotiation and forming contracts for purchase with companies and communicate with potential suppliers in distant countries is also easier than in the past with the internet and tools such as video conferencing and emails. This facilitates the use of international suppliers. However, other firms may choose local suppliers believing strategy will best suit their needs. Local suppliers may be able to provide where there is an increase in the transparency of the supply chain, less exposure to risks such as interruption and exchange rate risks and proximity may allow closer collaborative relationships to develop. Both procurement strategies are viable, to assess the advantages associated with each approach the procurement from international and local suppliers can…… [Read More]
Vice versa, a relaxation of credit operations through a reduction of the interest rates generates an increased purchasing power and an increased ability for the manufacturer to contract loans and further invest in his business.
2.6 Producer price index
The Producer Price Index, or the PPI, stands for "family of indexes that measures the average change in selling prices received by domestic producers of goods and services over time. PPIs measure price change from the perspective of the seller" (Investopedia, 2009). The evolution of the PPI has also been a fluctuating one, with a major ascendant trend:
Source: United States Department of Labor, 2009
Despite the past increase in producer price index, the future seems to hold decreases in its value:
The downward trend forecasted for the following 18 months means that the automobile producers in the United States receive less money for the sale of their products. Increases in…… [Read More]
S. This has partially continued during the 90s as well, so protectionist barriers is one of the things Nissan needs to consider when exporting to its main partners.
There are two different actions Nissan may consider in the future in this sense. The first one refers to the fact that Renault, an European company, still holds a significant part of Nissan shares, which may facilitate exports on the European market. On the other hand, trade barriers can generally be avoided by direct implementation in the respective country, a measure which Japanese companies, especially Toyota, have successfully applied in the U.S. during the 80s.
2. Internal competencies
A. General Motor seems to be currently both the most important producer and the sales leader. However, this should come with several amendments. If we are referring to the market leader, there are several criteria worth mentioning. First of all, the number of cars…… [Read More]
Collapse of the Big Three
America was once the leader and pioneer in the auto industry, a title that the country had for decades and a title that was so dear to America's heart that it was unfathomable to think that title might ever be lost. It's commonly misconstrued that America invented the automobile, when in reality that honor goes to German Karl Benz in 1885 (ozema, 2010). "Americans did, however, industrialize the love of the automobile. America loves big, fast cars, and for many decades American car companies shared the biggest slice of the auto industry pie" (ozema, 2010). America made having a car and the business of making cars firmly entrenched in American culture. This was a fact which kept the economy stimulated and which provided a consistent level of financial stability for the nation and the civilians within it. However the decade of the eighties marked the…… [Read More]
Sirius and XM Satellite Radio
Satellite radio has emerged in the past few years as the hot new trend in broadcasting. Operating similar to DirecTV, satellite radio companies bounce their signals off satellites to beam high-quality digital service coast-to-coast, offering exclusive ad-free programming. Satellite radio offers listeners the opportunity to hear any show anywhere in the United States, combining the benefits of premium quality sound and convenience when traveling on the road. Research indicates that similar to the way FM radio grew against dominant AM radio, satellite radio is becoming known for "edgier" alternative programming (McCarthy, at http://www.usatoday.com/money/media/2004-10-6-radio-compare_x.htm). The entire satellite radio industry is currently made up only two companies, XM Radio, which started broadcasting in 2001 and has 2.5 million customers, and Sirius, with 600,000 subscribers since going live in 2002. This paper will offer a comparative analysis of the two companies and a general overview of the satellite…… [Read More]
Not only this, the business processes are also accomplished through digital networks spanning the entire organization (Buyya, Yeo, Venugopal, Broberg, and Brandic, 2009).
One of the examples of the organizations that are quickly transforming themselves into digital firms is the Daimler Chrysler that includes the Chrysler Group and the Mercedes, which has digitalized every step of its vehicle production and sales processes. It has incorporated an integrated Volume Planning System that gathers sales data and sends them back to the production planning systems and from there to suppliers so that they can adjust their productions and deliveries of parts to make exactly the desired amount of models that are actually demanded and selling in the dealer showrooms.
One other example of how the going digital has altered the way firms can reach their customers can be witnessed in the music industry. According to CNN report, Digital Firms are playing a…… [Read More]
Finally they put it on the lift and run it in drive to see where the sound is coming from. It seems to be coming from the drive shaft. Turns out that the drive shaft had a manufacturing defect and was slightly bent. It was this bending that caused all the other problems but no one ever figured it out and it was a completely isolated incident. It was also out of warranty and even out of the Lemon Law jurisdiction. My cousin wound up trading the car in for a new one and the dealer gave him a good price on the trade in to make up for the problems.
Annual eport. (2005). New york's new car lemon law arbitration program. Office of the Attorney General of the State of New York. etrieved on 4/8/08 at http://www.oag.state.ny.us/consumer/cars/usedcar_lemonreport05.pdf
Bigda, Carolyn & Chatzky, Jean. (2004) Make Lemonade From Your Lemon.…… [Read More]
These businesses represented potential revenue with a lower startup cost than expansions on the manufacturing side.
To this point, the strategy had been successful. Ford's development functions had improved in efficiency and profitability had increased. Cost savings in 2000 totalled $500 million, for a total of $3.7 billion over the previous three years. There was some strategic logic to the push into services, in terms of capturing downstream revenues. However, this initiative did not support the previous objectives.
n 2001, Ford fell into tougher times. Whether the service businesses could be viewed as a distraction that harmed Ford's focus on its core business is questionable, but certainly those businesses were not a major factor helping Ford through this period. The main successes that helped Ford in this period were sales in Europe, which generated significant improvements in both revenues and profit. n North America, it was again automobile manufacturing that…… [Read More]
But regardless of the reasons for downsizing, fact remains that it is a process which severely affects both the organization as well as its employees. The major effect upon the organization is related to the corporate culture. In this order of ideas, Ford, like most American companies, promoted the idea of a secure workplace, one in which the employee is valued, cherished and accordingly rewarded. But his firing directly contradicts this initially stated mission, forcing as such the stakeholders to question the true intentions and capabilities of the organization which led it to stepping over their promoted culture. Looking at it from a different angle, the situation presents itself with an opposite conclusion. To better explain, the corporate culture at Ford, again like in most American companies, clearly states the company's intent to register profits. And if achieving this desiderate requires the downsizing of the personnel, they will engage in…… [Read More]
Price elasticity of demand
Traditionally, large ticket items do not have a great deal of elasticity in terms of price, because they are viewed as necessary goods, although they are not as elastic as a supermarket item one can 'stock up' on in bulk when it goes on sale. Car demand can be somewhat elastic in the sense that people can elect not to buy a new car, purchase a used car, or lease a model until prices decline -- there are market substitutes that can be cheaper, if the car market prices goods too high, as Ford was pricing its vehicles too high, and producing too many high-cost vehicles. Also, the price of compatible goods like gas can impact the choice of vehicle consumers chose to purchase. The Toyota Prius' popularity grew with the price of gas.
Ford's North American operations lost $1.6 billion in 2006,…… [Read More]
Used car sales
Increasing trend of car sharing
Weakened U.S. tourism industry ("Enterprise")
The sale of used cars by other organizations is a significant threat to Enterprise. Many of the world's largest car manufacturers, like Daimler Chrysler, General Motors, and Ford, are offering large incentives and low interest financing through their dealers on new vehicle purchases. For this reason, it makes owning a new vehicle more affordable for more consumers and conversely weakens used car pricing industry wide. This could be devastating for Enterprise with their traditional procedure of acquiring new vehicles and then disposing of them through their used car outlets. To date, Enterprise has enjoyed higher resale values on their vehicles, when compared to standard residual value, due to their consistent level of maintenance service. However, in recent years this margin between the vehicle sale price and the residual value has narrowed considerably, especially as used…… [Read More]
Human esource Management at the Ford Motor Company
The Ford Motor Company is one of the largest economic entities at the global level, with sales and operations across the entire globe. The organization is reputable as the first company to make automobiles accessible to the people through the usage of the production and assembly line. In more recent times, Ford is recognized as one of the largest employers in the United States and a global leader of the automotive industry.
During 2008, the company was hit by the internationalized economic crisis, which raised new financial concerns, but also exacerbated the problems already existent within the firm. For decades, Ford had invested in large size and luxurious vehicles as an emblem of American consumerism. Throughout the past recent years however, the preferences of consumers have changed to reflect the shifting international price of oil and environmental concerns. More and more smaller…… [Read More]
Satellite Radio: The New Technology
Everyone is familiar with cable TV. To get TV signals sent to your TV via cable, the cable company runs wires to your home. It's similar to traditional phone services. Depending on where you live, the wires may be strung above ground or hidden below ground, but the signal to your TV arrives through a physical channel - a wire.
Some people have dropped cable TV in favor of satellite TV. With satellite TV, the viewers have satellite dishes attached to their homes. These dishes receive signals sent from satellites in space. While this seems like new technology, is it simply a major improvement on the first way TV signals were sent, from transmitting towers to each home's antenna. One of satellite TV's advantages is that because the satellite sending the signal is in outer space, it can receive TV signals from a much wider…… [Read More]
market capitalization of 23.011 billion, oeing is the nation's largest producer of commercial aircraft and the world's leading aerospace company. It operates in four principal segments: Commercial Airplanes, Military Aircraft and Missile Systems, Space and Communications, and oeing Capital Corporation. As the world's market for air travel fluctuates with the risk of war, so do oeing's revenues. However, as the United States moves towards a footing that may include future wars against perceived 'terrorist states,' oeing stands to gain from military aircraft and weapons production. As such, it intrigues investors as its market is a careful reflection of the front pages of the world's newspapers.
To successfully evaluate oeing's stock, we must analyze its fundamentals and the performance of comparables, as well as market performance. A projection of future revenues is necessary, along with an estimation of the cost of capital with which oeing produces. These allow us to provide…… [Read More]
On the American 'front,' Schrempp has found himself in conflict with American unions, as he attempts to negotiate an early retirement settlement with unnecessary workers, to reduce costs. Schrempp evidently hopes to maintain a positive buzz about the company, keep investors happy and thus keep revenue flowing in the future, while taking a hit in the short-term as he waits for the company to gradually show a profit once more workers retire. It remains to be seen if his strategy will pay off.
Obviously, the CEO hopes that there will be savings on the horizon, and feels that the greatest risk posed to the company is by a hostile takeover that could occur if the crucial Deutsche Bank and the Kuwait Investment Authorities sell their shares in the company, given that they make up such a large percentage of the company's investors. But if the company continues to use up…… [Read More]
In the case of Toyota they have focused on supply chain integration, collaboration and collaborative forecasting and replenishment (CPF) workflows. What emerges from this SWOT analysis from a competitive analysis standpoint is that while Fiat was concentrating on product-driven strategies for differentiation, its competitors had embraced and were well on their way to making processes their core competitive advantage, especially those augmenting personal productivity (Porter, 2008).
Fiat's opportunities however are significant. There is growing truck market demand, increasing demand for manufacturing equipment in BIC nations and growing need fro construction vehicles in China and India. As Tata Motors has worked to dominate the passenger car market in India, there is no company focused on construction vehicle development. For Fiat, this presents a unique and highly differentiated opportunity.
The threats Fiat faces are comparable to many other global auto manufacturers, including the continued contraction of credit and therefore the entire auto…… [Read More]
Globalization and Technological Influences
On International Mergers: DaimlerChrysler as a Case Study
One of the most interesting international manufacturing mergers of the 20th century was the 1998 negotiation between the Daimler auto company headquartered in Germany and the struggling Chrysler corporation, headquartered in the U.S. Daimler's buyout of Chrysler resulted in a merger that ultimately failed to benefit either party, and may have seriously damaged both organizations' capacity for future growth. Below, I will discuss how the merger proceeded -- as it was covered in U.S. And international business media -- and how the negotiations for the merger and the 2007 spinoff of Chrysler were facilitated by technological developments and global business practices. I will also discuss motivations for international mergers in general and how they applied specifically in the case of the DaimlerChrysler merger.
As a horizontal merger, DaimlerChrysler followed a popular movement towards consolidation in the international auto…… [Read More]
Once the plan has been created, you must begin training / development as soon as possible. This means, that HR personnel must begin to training the staff on the new policies and procedures that will be implemented. Under ideal circumstances, the HR department would want to begin training as soon as possible. This is because there will be a window, between the time frame that the merger is announced and when the actual deal occurs. The reason why is, various regulators as well as the shareholders will need time to: examine the merger, debate about it and vote on it. In most cases, these kinds of mergers can usually take a few months to occur. Given the circumstances surrounding the merger, what more than likely happen is this time table will be increased. This because the regulators will want We Will Hang Onto it Savings, to close the…… [Read More]
IHRM issues that occur when organizations undertake cross-border mergers, acquisitions and international joint ventures
Globalization of economic systems has created a new business environment in the last couple of decades. This trend is largely driven by international trade and multinational corporations expanding crossed international borders. One consequence of this trend is that many multi-national corporations (MNCs) have created an international culture of business that is shared to some extent in most corners of the globe. hen an MNC mergers, acquires, or forms a joint venture in a new market then this acts to create a mix of cultures in that new organization and its people. The new culture that arises tends to have many elements of the broader international business culture. Although this trend has been heavily fostered by the business community, it also has spilled over to also affect various social and political norms.
The trend…… [Read More]
Use of single version of the truth and single information
Balanced set of strategic metrics (Financial and non-financial).
New methods of cost accounting (ABC, Target Costing).
Internal vs. External Focus (Benchmarking and Self-Assessment).
Process Management and Measures (value delivery).
Stakeholder value measures
Uniform set of measures
Causal relationships between measures across all levels.
Source: Lieberman; (1994; et.al.).
Automotive Industry Analysis
Entering 2007 it is clear that Japanese firms, lead by Toyota, will be at parity with and potentially surpass the Big Three automakers' market share in the U.S. And globally. The Big Three automakers, all in various phases and strategies of restructurings today, will continue to look towards significant cost reduction strategies over time. General Motors and Ford specifically are offering early retirements and incentives to further decrease payroll, pension and healthcare costs. It is anticipated Ford will consider selling Land over, as the sales of Austin Martin is pending.…… [Read More]
2007 Economic Crisis on American Car market
Effect of the 2008 global economic crisis on automotive industries
Crisis in the United States
Crisis in Canada
Crisis in ussia
Crisis in European markets
Crisis in Asian markets
Effects by other related crisis events
In this paper, we will review the effects of 2008 global automotive crisis. Our main focus will be on the American car manufacturers and the negative impact they suffered due to the crisis. We will also have a look at how this crisis had affected car manufacturers in other major markets around the world notably Europe, Canada and the prominent Asian markets such as China and India. Finally, we will look at some of the other factors which were important to this event namely the energy crisis since the cost of fuel is directly related to the car industry.
The automobile industry is a very important part…… [Read More]
Overall the automobile industry must make a more concerted effort o behave in ways that are consistent with accepted business ethics. From a utilitarian standpoint the automakers must begins to consider the consequences of their actions in the decision making process. At the current time Toyota is fighting to rebuild its brand image because the company6 did not thoroughly take into consideration the consequences of their actions. From a deontological standpoint the automobile companies have failed to act in ways that are just as it relates to the bailout and the recall of defective vehicles by Toyota. Going forward the companies that make up the industry must learn from the issues they have been confronted with in recent years. It is only through such a process that the entire industry will reflect a more ethical business model. An increase in ethical responsibility will likely prove effective attracting customers back…… [Read More]
his is because of the fact that Chrysler is now getting back its success, as well as because of the fact that the company now is becoming more and more known worldwide. he utilization of Clint Eastwood was also a stroke of genius. His voice is not only well-known but also authoritative and emotional in a way that only adds credibility to the brand.
he ethos here is thus found on two fronts: the subject of the commercial as well as the way in which it is delivered by Eastwood. When he speaks about Detroit, Eastwood utilizes personal as well-known anecdotes that the country can recognize and that can rally it towards a common goal. In fact, the word 'rally' and the phrase 'acted as one' is utilized many times, as Eastwood stresses, time and again his faith in the strength of the country, as well as its ability to…… [Read More]
With such result, estimates for the 2,400 F-111 (including their exports) were significantly reduced, but nevertheless, General Dynamics still managed to obtain a $300 million profit with this project.
Grumman started also to build the F-14 Tomcat, using many of the F-111 innovations, but build solely for its purpose of serving as a carrier-borne fighter.
General Dynamics eorganization - it was in May 1965 that the company reorganized its activities into 12 operational divisions, having as a base their production lines. The board took the decision to have all future planes built in Fort Worth and thus ended the plane production in San Diego, which had been Convair's original plant. At the San Diego location the production of space and missile development continued.
The second CEO in this period, David S. Lewis required the headquarters of the company to be moved to St. Louis, event that took place finally in…… [Read More]
MIT Sloan Management Case Study
Evaluate the internal resources and core capabilities of CX Technology. This should include as a minimum the value chain for this firm. Overall, what are the key strengths and weaknesses of CX Technology? (Johnson et al., 2014)
Conduct a detailed and systematic external environmental audit of the U.S. automotive industry market. This should include as a minimum; PESTLE, 5-forces, industry life cycle and competitor analysis (Johnson et al., 2014). Overall, what do you conclude about the opportunities and threats for CX Technology?
Critically evaluate the factors that an organisation should investigate when considering entry into emerging markets. Use relevant theories and models to support your
Question 1 - Evaluate the internal resources and core capabilities of CX Technology. This should include as a minimum the value chain for this firm. Overall, what are the…… [Read More]
Marketing Case Study
The case study being completed in this reports asks the author of this response to answer to three major questions. The first is what Fournier means when she says that consumers have relationsihps with a brand. The second question asks the author two pick two out of three brands from a list provided in the assignment and explain if and/or how consumers do or do not have relationships with those brands. The third questions asks the author to explain whether the relationship between brand and consumer is universal or not and why the author of this response believes that to be the case.
As for the first question, Ms. Fournier talks in the opening or her 1998 treatise about how there has been a lot of work done regarding the relationships that businesses and vendors have vis-a-vis their established lines of communication and business agreements/arrangements.…… [Read More]
Where, the benchmarks will show if the system is helping or hindering the company from achieving its objectives. This is significant, because when it is used in conjunction with flexibility, you can be able to effectively adapt to changes in the markets. With flexibility providing the necessary ingredients to implement such changes, while the use of benchmarks will identify when a management system is becoming unproductive. (Ireland, 2008, pp. 33 -- 39)
The use of knowledge management is when an organization is collecting and analyzing the total amounts of knowledge at their disposal. This would include analyzing all available: resources, employee / managerial skills and documents. This is significant, because it provides a way for an organization to quickly collect and analyze a wide variety of information. At which point, managers can be able to effectively place the different resources and personnel of the company, in those areas where they…… [Read More]
MESIC's have been singularly unsuccessful, and have been deemphasized in recent years.
Related to this are: State-sponsored venture capital investments. Countries and regions invest in venture capital funds as Limited Partners, meaning that they have the same or similar financial returns as all other investors in a Fund. In many cases, such state investments require some conditions on the privately-run venture fund. The most popular conditions include:
fixed percentage threshold of investment in the region or country, or certain number of jobs to be generated by their investments, or Attracting a certain multiple of investment from outside the state or region into the fund, or Limiting the venture investments to the types of technologies and industries which are of greatest interest to that state or region.
Examples of the above can include the Indiana Futures Fund, in which the State of Indiana invested $100 million in several venture funds. Among…… [Read More]
Merger, Acquisition, And International Strategies
Ford Corporation: The Volvo takeover
It's imperative for the automotive companies to attain benefits of scale whilst developing latest products which is costing exceedingly high in the present business environment. Compared to the 90's the chances of attaining benefits of scale while saving costs has altered quite a bit. Model volumes have declined which creates difficulties for companies to attain economies of scale, while saving costs. Hence, as a last resort, companies merge with each other, acquire and form alliances with each other to save rising costs while developing new technology and products (Lundback, 2002).
Ford Motor Company
The Ford Motor Company is the second leading profitable automaker in the world. Ford has recently acquired the Swedish-based Volvo for $6.45 billion. Fords profits last year were a bit more than that with $6.57 billion. It's yet another quick acquisition among many others. Ford at present…… [Read More]
Human beings are by nature change-resistant and particularly within an organizational context there is anxiety about change, given fears of job losses or simply being unable to adapt. It is essential to convince change agents of the need and urgency for change and also of the congruency of the change with the evolving vision for the company.
A "vision statement should have four elements: a customer orientation, employee focus, organizational competencies, and standards of excellence" ("Changing the game," 2015:3). The change should be demonstrated to enhance all of the organization's capacities, not simply improve its bottom line in the short-term. Having an effective vision statement is necessary for effective change. The Lewin Model of organizational change stresses the need for a three-part adaptation process called unfreezing, changing, and refreezing. In other words, the organization must be temporarily destabilized or unfrozen before it returns to a new…… [Read More]
Ford Motors: Strategy to Beat Competitors Using Operations and Supply Chain
Ford Motor Company is the second largest automobile manufacturer in the United States apart from General Motors. The Ford Company is credited for the production of trucks and cars for mass markets. The company also produces car accessories such as cars' electronic components, vehicles' plastic, and replacement parts. Moreover, Ford Motor owns approximately 8% stakes in Aston Martin, a 2.1% stake in Mazda, and 49% stake in Jiangling. Ford Motor also develops joint ventures with several companies around the world. The company has also diversified their business operations into financial services such as American oad Insurance and Ford Motor Credit. However, Lincoln and Ford's models accounted for the approximately 10.5% of the company sales in the United States. A rise in prosperity of emerging markets has made Ford focusing their business attention in China. At the end…… [Read More]