...Fiat and Chrysler Merger: An Analysis of the alliance of Fiat and Chrysler Taneka Littlejohn Sonya Merrill August 29, 2011 1 Table of Contents Project Outline I. Executive Summary II. Introduction III. Company Profile and Environment (Context) IV. Strategic Issues and Reverence V. Stakeholder Impact VI. Conclusions and Recommendations VII. Bibliography 3-4 5-6 7 8-9 10-12 12-13 13-14 15 2 Project Outline I. Discuss history of Chrysler Group A. Discuss Chrysler’s start within the automotive industry B. Discuss some of the automobiles that Chrysler makes C. Discuss Chrysler’s position within the automotive market II. Discuss history of Fiat SPA A. Discuss Fiat’s start within the automotive industry B. Discuss some of the automobiles that Fiat makes C. Discuss Fiat’s position within the automotive industry III. Discuss how both automobile firms have had past reputations in America. A. Discuss when Fiat first came to the United States B. Discuss why Fiat suddenly left the United States C. Discuss Chrysler impact within the American market and how America’s past look on their automobiles shaped its future. IV. Discuss some of the competitors of Chrysler and Fiat A. Discuss how competition affected both firms B. Discuss how Chrysler and Fiat at one point were competition for one another V. Cultural Context A. Culture aspects of the Chrysler- Fiat alliance B. Discuss how society and positioning have affected both automobile firms C. Discuss some recent news about the...
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...1. While this was not the most ideal situation for Chrysler, I think the alliance with Fiat was a necessity. Chrysler had a tremendous loss in profits, had to lay off many workers, and was going to have to file for bankruptcy. This was a great option to help them stay afloat and get help from an outside source. Obviously for Fiat this was a good move. They did take a risk since Chrysler was going into bankruptcy, but they were able to acquire it for a reasonable price and also help themselves to re-enter into North America with a company that already had a solid market share. Fiat most recently purchased the 41% of Chrysler they did not own. The company is definitely on the upswing and will be able to better compete with GM and Ford. 2. Before 2009 strategic alliance: Chrysler – Strengths of Chrysler were they have a strong brand name and recognition within North America. In addition, their Jeep and minivan lines are very popular. They were one of the top three recognized auto brands in North America. Weaknesses were there was no presence in overseas in Europe, they were going into bankruptcy, and their de-merger with DaimlerChrysler hurt them financially. They also remained behind the other manufactures for quality and satisfaction with consumers and had little or no sub-compact cars. Fiat – Strengths of Fiat were they had reinvented themselves overseas in the European markets and are one of the most visible brands of small brand cars in Europe and quality is very...
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...The 2009 Chrysler-Fiat Strategic Alliance Part-I What are your views of the 2009 Chrysler-Fiat strategic alliance and its future prospects in the auto industry? The strategic alliance between Chrysler and Fiat was a beneficial step for both the companies. Chrysler was facing problem of financial crisis of 2008-2009 and was not able to perform after de- merging with Daimler in the year 2007. In North-America Chrysler was facing challenges of its bankruptcy filing and global financial crisis, because of which the demand of its car decreased in the domestic market. In order to recover from this loss, Chrysler had no other option but to find a partner with whom it could serve the foreign market. Chrysler surveyed the possibilities of various big automakers like Nissan, TATA Motors, Ford, Volkswagen, GM and Fiat. Finally they decided to create a strategic alliance with Fiat. In this alliance Fiat agreed for 20% of Chrysler stake and increased to 35% within five years. With this Alliance, Fiat got the opportunity to enter the US Market and instead of paying for the 35% of Chrysler stake, they provided Chrysler access to their technology in automobiles. (Calabrese, 2012) Fiat announced publicly their intention to open a production center in North America for manufacturing of Alfa Romeo and Fiat brands. By doing so they gained 35% stake in Chrysler and gained access to the Chrysler production center in America. Similarly, Chrysler also benefitted by gaining...
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...Case Study 3 The 2009 Chrysler-Fiat Strategic Alliance 1. What are your views of the 2009 Chrysler-Fiat strategic alliance and its future prospects in the auto industry? When it comes to dealing with worldwide economic recession, grave steps have to be taken in order to ensure the survival of businesses, as too many livelihoods depend on it. Also, due to the investments that shareholders make, and the wide array of other businesses that the company would affect, it puts a lot of pressure on the board or the people running the company to make sure that they survive the bad times and emerge victorious. For Chrysler, it was a major setback when Daimler decided to withdraw its partnership and give its 80 per cent stake to Cerberus for less than 1/4th of the price they bought it for. Chrysler was doing badly, and although known as the “Number Three” car in North America, it was not able to keep up and had to declare bankruptcy and was told to form a strategic alliance with a company as a part of the Obama Administration rescue plan. Fiat has had its own share of ups and downs, but in the European market it has proven to be successful. It withdrew itself from the North American market in the nineteen eighties as it could not keep up there. But now, with its strategic alliance with Chrysler, it can benefit by entering into the North American market without having to push too much as Chrysler is already a well-known brand there. The Strategic Alliance was definitely very...
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...2013 Case 7 The 2009 Chrysler-Fiat Strategic Alliance 1. The strategic alliance was defiantly needed. This was important since Chrysler has a tremendous loss in 2008 and had to lay off many of their workers. They were also going bankrupt, so this was the best option to keep them afloat. They could not keep up with the economy and needed to get help from someone. This deal made sense for Fiat, since they could get the company at a low price and re-enter into North America. They also have a good thing going in that fact that they own 21 percent since 2009, then can get it increased to 35 percent this year and eventually might have 51 percent of the company. This was not the most ideal thing for Chrysler, but it was necessary. 2. Chrysler has a brand name in North America, where Fiat lacks the visibility. Fiat has been very successful in Europe, where Chrysler does not have a strong dealer network there. Chrysler finds new markers by developing new range of vehicles. After the merger, Chrysler emerges from the bankruptcy and starts to restructure and Fiat gains a brand in North America and technology from here. 3. Chrysler had always been behind Ford and GM and was known as the “number three.” Since the merger, they were able to gain more in Europe and new technology. As they are still not the number one company they have bettered themselves and are on the rise. The other five companies are still on the rise as well, so Chrysler-Fiat will have to work extra...
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...Case Study – Chrysler-Fiat Strategic Alliance 1. What are your views of the 2009 Chrysler-Fiat strategic alliance and its future prospects in the auto industry? * According to me, the alliance is good both for Chrysler and fiat. Fiat can take care of the technology of Chrysler. It can have fiats well-developed distribution network in European market. Fiat will have the advantage of North American market. Combined production capacity will bring profits. * They also have problems in many aspects. Different corporate culture Mismatch of brands Regulatory issues 2. Analyze and evaluate Chrysler and Fiat’s strengths and weaknesses before and after their 2009 strategic alliance (see Table II and III). Fiat | Strengths | Weakness | Before Alliance | * Fiat acquires Lancia and 50% of Italian icon Ferrari. * Fiat became the largest automaker in Europe by acquiring Alfa Romeo from the Italian government. * Fiat hires Sergio Marchionne to become its CEO * Fiat was the largest automaker in Europe. | * Fiat had labor strikes and assembly line problems. * Took off jobs of many employees. | AfterAlliance | * Fiat have the advantage of getting new technology * Large distribution network in Europe and North America. | * Labor union problems * Ownership problems | Chrysler | Strengths | Weakness | Before Alliance | * Chrysler had a market share of 12.5% in U.S in 2008. * The company was a big player in North America in mini...
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...Marchionne On April 30, 2009, Chrysler filed for bankruptcy due to failure to generate sufficient profits. As a result, a new partnership ensued with the Italy based car company, Fiat (Roubini, 2009). Since then, Chrysler Group LLC Chief Executive, Sergio Marchionne, has taken measures to change the attitude and organizational culture of the company to recover from the bankruptcy, as well as being a leader among American car manufacturers (Muller, 2011). The Chrysler Group shows a number of observable artifacts, espoused values, and basic assumptions that are associated with the corporation. Among the observable artifacts is the website that outlines the cultural values of the company. Some of these values are innovation, which is a desire to put out a better, more technologically advanced product then their competitors (Chrysler Group, n.d.). One way the...
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...views of the 2009 Chrysler-Fiat strategic alliance and its future prospects in the auto industry? The alignment between Fiat and Chrysler does not exactly save Chrysler. It gives Fiat an entry into the U.S. In short, Fiat is to get 35% of Chrysler, will not pay any cash for the stake, and it will give Chrysler access to its technology. Fiat had publicly said it wanted a production base in North America for its Alfa Romeo brand--and presumably the Fiat brand, too. Through its35% interest that it is getting in Chrysler, it would presumably have access to a U.S. plant to build its cars. The case is intended to have students look at the 2009 Chrysler-Fiat strategic alliance, its current issues, and future viability in the global auto industry. The new landscape of the American auto industry and the role of Fiat is analyzed in the cross-border tie-up. After de-merging with Daimler in 2007, Chrysler did not do well because of the 2008-2009 global financial crises and its bankruptcy filing. Chrysler’s other problems included its financial constraints and heightened competition in North America. The company had no choice but to look for a partner. During this process, Chrysler explored the possibility of a tie-up with GM, Ford, Volkswagen, Tata Motors, Nissan and Fiat. Eventually Chrysler decided on creating a strategic alliance where Fiat agreed on taking a 20 percent stake in Chrysler. In the next five years, the tie-up may increase Fiat’s ownership of Chrysler to 35 percent. Both...
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...Vállalati együttműködések az autóiparban Háló Ádám Első évfolyam 2013.10.24 Vállalati együttműködések az autóiparban Dolgozatom témájául az autóiparban végbement és manapság is végbemenő autógyártó nagyvállalatok együttműködését választottam. A következőkben bemutatom a különböző stratégiai szövetségeket, valamint azok előnyeit és hátrányait néhány nagyvállalat példáján keresztül. Kitérek az kooperációk előzményeire és eredményeire egyaránt, illetve véleményezem és elemzem azokat. Az autóipar az egyik legnagyobb és legjövedelmezőbb ipar a világon, melyet több nagyvállalat ural. Hatalmas a verseny a piacon, sokszor a vállalatokon belüli autómárkák között is, amire a 2008-ban bekövetkezett válság még rátett egy lapáttal. A kiéleződött verseny során a cégcsoportok megpróbálják tartani az ütemet egymással, próbálnak új piacra betörni, ezzel növelve eladási számaikat, új fejlesztésekre ruháznak be vonzóbbá téve modelljeiket az ügyfelek számára és próbálják a költségvetésüket redukálni, hogy termékeik megfelelő árszínvonalon maradjanak. És pontosan ezen okoknál fogva születnek meg a stratégiai szövetségek a vállalatok között. A cégcsoportokon belül többnyire több autómárka fordul elő, melyek természetesen szoros kapcsolatban állnak egymással mind a fejlesztések mind az értékesítés terén. Ez annyit jelent, hogy például az olyan nagy cégek, mint a General Motors, aki a tulajdonosa az Opelnek és a Cadillacnak is, ugyanazokat a fejlesztéseket mindkét márka modelljeiben...
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...MANAŽMENTU FIAT - CHRYSLER Vypracovanie zadania na predmet Medzinárodný manažment a medzinárodné podnikanie Bratislava Jakub Karľa akademický rok 2011/2012 1. Stručná charakteristika spoločnosti Fiat – Chrysler Fúzia spoločností Fiat S.p.A. a Chrysler Group LLC sa oficiálne udiala v roku 2009. Prvé správy o tejto fúzii sa objavili 20. Januára 2009, kedy spoločnosť Fiat súhlasila s odkúpením 20% podielu vo firme Chrysler, ktorý bol v tom období v ohrození bankrotu. Obe spoločnosti sa zaviazali, že si budú navzájom poskytovať technológie, ktoré im pomôžu v boji s konkurenciou, hlavne s firmami Toyota, Volkswagen a alianciou Renault S.A. a Nissanu. Firma Fiat S.p.A. je talianska automobilová spoločnosť, ktorá bola založená v roku 1899. Zakladateľ spoločnosti bol Giovanni Agnelli. Sídlo spoločnosti je v Turíne, z čoho vychádza aj plný názov spoločnosti Fabbrica Italiana Automobili Torino plus skratka S.p.A., čo znamená Sozietà per Azioni, čo je v preklade akciová spoločnosť. Firma sa zaoberá výrobou automobilov, je to jedenásta najväčšia automobilka na svete a najväčšia automobilka Talianska. V roku 2010 predala spolu 2 410 021 automobilov. Do spoločnosti Fiat S.p.A. spolu patrí 7 automobiliek: Abarth, Alfa Romeo, Ferrari, Fiat, Fiat Proffesional, Lancia a Maserati. Fiat vyrába svoje automobily po celom svete. Mimo Talianska má najväčšiu výrobňu v Brazílii, kde je tiež Fiat trhovým...
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...1. What are your views of the Chrysler-Fiat auto alliance and its status in 2012? Despite some drawbacks, the alliance has worked well, and has been beneficial for Chrysler and Fiat. The growth and survival of both companies had faced problems in the areas of technology and quality standards. Chrysler needed the alliance for survival due to its bankruptcy position and conditions of bailout. It also needed a partner to bring innovation, increased R&D opportunities, low cost technology and access to European markets. Fiat wanted to reenter the North American market and needed access and distribution through an established manufacturer that knew the market, and had the technology available; which would be possible through a strategic alliance with Chrysler. There were concerns that all synergies would not be successful due to cultural differences and integration issues; however, the opportunities that existed to reduce costs, expand into new markets, and provide low priced fuel -efficient automobiles outweighed those concerns. As of 2012, Chrysler and Fiat seemed to be in a good position regarding capitalizing on the alliance. It has brought major savings in the areas of joint product development, supplier networks, and dealer networks. Both Chrysler and Fiat have raised their quality ratings and established dealer networks in the U.S. and Europe. The alliance sold 4.2 million vehicles worldwide in 2011 and planned to sell six million automobiles worldwide by 2014. ...
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...fortify its worldwide truck leadership position. This expansion and commitment to small fuel-efficient cars puts it in direct competition with FIAT, more heavily in the American market than in the European market, being that Ford has a significant hold on the American Market in comparison to FIAT as a new entrant. Not only does Ford have the competitive advantage of defending its truck/SUV position in a nation of truck and SUV drivers (America; historical aversion to small cars), but a pre-existing reputability and domestic consumer awareness (vs. FIAT with its shoddy reputation for quality). Ford can use its foothold in the truck/SUV market to capture the new small car market, its current market share in the U.S. is 15.3 percent. However, FIATs acquisition of Chrysler may strengthen their American positioning. Unfortunately it is too soon to really tell. Comparable product offerings: Ford Focus and Ford Fiesta when compared to FIAT Punto and FIAT Panda. Peugeot: This France-based company is a huge competitor to FIAT based on product offerings, as it focuses on the same niche: passenger cars and light commercial vehicles (many fuel efficient/hybrid). It currently has a European market share of 17.4 percent compared to FIAT at 6.5 percent. However FIATs recent initiatives show that it could beat out the competition. Peugeot and FIAT are both controlled by holding companies, operate in the continental European mass market, have relatively weak competitive positions outside...
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...Fiat plays double or quits with Chrysler Introduction Below are two articles about the merger between Fiat and Chrysler. Please read these and analyse them in the context of TWO of the theoretical frameworks ( One from OS, One from HR) which have been reviewed and considered in this course. Your answer should include: A brief summary of the relevant theories, and any evidenced based critique of those theories You should then apply those three concepts to this case study, so as to illustrate how they apply, or may be contradicted, in the Fiat –Chrysler merger. From The Economist, 27 November 2010, P 73-74 IN JANUARY Fiat cars will be back on sale in America for the first time in 27 years. The tiny, retro-styled Fiat 500 will appear in the showrooms of 130 dealers across the country. It was launched at the Los Angeles motor show last week, alongside a revamped Chrysler range. Fiat’s return to America is the first visible result of what is intended to be an ever closer union with Chrysler, agreed on last year when the Detroit giant was in bankruptcy. The two companies are betting that the Fiat 500—designed by Frank Stephenson, the man behind BMW’s transatlantic success with the MINI—will also prove as popular with Americans as it has with Europeans. Returning to a country from which Fiat was driven out by poor quality—Americans used to quip that its name stood for “Fix It Again, Tony”—is a big risk. But the reward is to get back into one of the world’s largest...
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...Shana mauroner Best Buy Co. Inc. Resources: * International segment * Brands * Electronics * Geek Squad * Strategic partnerships with a series of acquisitions * Advertising * Supply chain * Internet Presence * Brian Dunn * Knowledgeable employees Capabilities: * Repair services * Market resiliency * Strategic acquisitions * Installation services * Customer educating Core capabilities: * Brands * Strategic Acquisitions * Strategic Advertising * Product services * Internet sales Finding of fact one: How can Best Buy maintain innovative products, while facing increased competition such as Wal mart. Best Buy saw its largest rival, circuit city, go bankrupt, However, a new archrival , Wal- Mart , was expanding into consumer electronics and stepping up competition in a price war Wal-Mart hoped to win Best Buy needed to face the competition not by lowering prices, but by coming up with something really different. Best Buy needs to determine the correct path to improve its ability to differentiate itself from competitors such as Wal-Mart, office max Etc. First, Best Buy would need to continue to cut prices. Consumer electronics shoppers are really looking for are the lowest priced products. The company should focus on more high-end products and new interactive features to differentiate itself from the big box atmosphere at Wal-Mart. Best Buy could Meet with their Research and development...
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...Alfa Romeo b. A challenger position c. The threats and opportunities d. Marketing Mix (4P) 4) Conclusion 1) Introduction: Alfa Romeo is an Italian carmaker born in 1910, in Milano. Since 1986, the brand is a part of the Italian Automotive group Fiat. The Fiat Group owns the brands Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Ferrari, Iveco, Jeep, Lancia and Maserati. The CEO of Fiat is Sergio Marchionne and Harald Wester is the CEO of Alfa Romeo. Alfa Romeo left the Us Market in 1995, because its situation was dire, after a gold period in the middle of the sixties. Since 1995, Alfa Romeo officially sold only two models in the USA, representing 125 units. Fiat Group aims to develop its position on the world market, in September 2010, Fiat was the ninth automotive group in the world, with a production of 2.46 millions of vehicles. To develop itself on an international way, the group is counting on the US market and had implemented many strategies to increase its market shares. The main one was to progressively acquire the Chrysler LLC group in 2009. Currently the group is present in the USA, with the brands Chrysler, Dodge, Ferrari, Fiat, Iveco, Jeep and Maserati. The next step of this global strategy is the come back of Alfa Romeo on the US market. The group aims to reintroduce the brand in the USA in 2013. With this come back, Alfa Romeo expects to sell 400,000 around the world in 2014 and to increase its...
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