Strategy Development In The Global Automotive Industry Essay

Strategy organic evolution In The Global Automotive Industry - Essay ExampleModern technology has made it easier to bring home the bacon and expand businesses, without even moving out of your office.As the world is getting smaller, grocerys are getting larger Every persistence is witnessing mergers, acquisitions, a foray into new and emerging markets and a boost in gross revenue and profits. The customer has never had it so goodCompetition on a global basis has resulted in reduced costs, better quality, improved responsiveness and excellent customer service for any product. The automobile industry is a classic example to demonstrate this phenomenon. Let us take the examples of two automobile companies Daimler Chrysler and Honda and poke into how globalization has affected the operations of these two companies.In 1998, US-based Chrysler Corp. merged with German automaker Daimler-Benz (1926-1998) of Stuttgart, Germany in a deal that was expected to reshape the auto industry. The deal created a new entity, DaimlerChrysler, which was the highest revenue earner in Germany. The best of technology, safety and comfort in automobiles came together to create the worlds best known car company. With the merger, it was ruling that Chrysler would have a better access to the European market, while Mercedes parent Daimler-Benz would gain a bigger foothold in the American market. This also gave a chance to both companies to reduce costs. Against globalizationharmonize to the article The DaimlerChrysler Merger submitted at Tuck School of Business, Dartmouth, http//mba.tuck.dartmouth.edu/pdf/2002-1-0071.pdf ,accessed 5th May,2008, In 2001, three years afterward a merger of equals with Daimler-Benz, the outlook is much bleaker. The financial data is sobering Chrysler Group is on stinger to hemorrhage $3 billion this year, its U.S. market share has sunk to 14%, earnings have slid by 20%, and the once independent company has been fully subordinated to Stuttgart4. Its key re venue generators - the minivan, the Jeep SUV, and the supercharged pickup truck truck - have all come under heavy arguing from Toyota, Honda, General Motors and Ford. Chrysler continues to make fewer passenger cars of note, save the Neon and limited-release Viper and Prowler.Competition from Toyota According to Premium Brand Analysis http//www.pwc.com/extweb/industry.nsf/docid/ccd6ae64aad8ea31802570d90035614e/$file/wylie_stbildagen07.pdf,accessed on 5th May,2008,In the EU, European Premium brands have attained - and maintained -a position of dictum in the Premium market space. European Premium leads the way, in the USA, but others maybe catching up fast. In the USA, European Premium brands have also grown, but have also faced competition from Asian brands. US Premium segment is also targeted by Japanese Premium brands (Lexus, Infinti and Acura), which collectively held 3.8% ofthe market in 2005Competition from Asian bigwigs like Toyota is definitely eating into Daimler Chryslers profit margins across the globe. People instantly have a choice between a pricier, classy Mercedes and an equally efficient, dependable, but much to a greater extent economical ToyotaCompany HondaFor GlobalizationThrough globalization, even small and mid-sized