Strategic Management- DaimlerChysler Assignment
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Taking into account the changing strategic and competitive environment of the automobile industry in the 1990s, identify and evaluate Daimler-Benz and Chrysler’s objectives in the merger. How well was the pre-acquisition planning handled?
Daimler-Benz was a German car corporation founded by Gottlieb Daimler and Carl Benz, when both engaged in a merger in 1926. Daimler-Benz started off manufacturing automobiles, motor vehicles and internal combustion engines, agreeing that all factories would use the brand name ‘Mercedes Benz’. Daimler-Benz was later recognised for producing luxury cars. Chrysler on the other hand was the third largest US based car maker and was founded by Walter Chrysler in 1925. Chrysler manufactured cars, minivans, sport-utility vehicles and trucks. Daimler-Benz and Chrysler merged in 1998 forming DaimlerChrysler. This was the biggest merger in history.
The Strategic environment is referred to the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfil stakeholder expectations (Johnson and Scholes). Competitive environment is the immediate competitive context in which an organisation or enterprise operates in (www.palgrave.com). The automobile industry in the 1990’s had accelerated during the last half of the decade due to the construction of important overseas facilities. The advancements in industrialisation led to significant increases in the growth and production of Japanese and German markets, in particular. Increasing global trade had enabled the growth in world commercial distribution systems, which had also expanded global competition amongst the automobile manufacturers. During this time there was a rapid