...2008 Collapse of Chrysler Melinda A. Dobson MGT 435 Organizational Change Robert Hamamoto November 18, 2011 The 2008 Collapse of Chrysler Beginning in the late half of 2008, a global recession hit the economy of the United States. With a combination of several years of declining automobile sales and the limited availability of credit led to a more widespread crisis in the United States auto industry in 2008 and 2009. Soon after the dramatic decline in sales, the U.S automaker, Chrysler, requested emergency loans from the government in order to stay afloat. In 2009, Chrysler’s situation had gotten worse and was faced with imminent bankruptcy and liquidation. With that being said, I would like to discuss the changes that have been implemented to Chrysler, identify new changes that still need to be implemented and assess the effectiveness of the change and the potential benefits of the new changes. Chrysler is an American automobile manufacturer that has built automobiles since 1925 and was the second largest automaker between 1936 and 1949. After a merger with Daimler-Benz Corporation in 1998, Chrysler was part of the German based DaimlerChrysler now known as Daimler AG. Chrysler suffered from poor management and lack of investment until 2007 when the company was sold to Cerberus Capital Management. Under DaimlerChrysler, the company went by the name of “DaimlerChrysler Motors Company LLC,” with its U.S operations referred to as the “Chrysler Group.” Then Daimler-Benz...
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...Running Head: THE FAIL & SUCCESS MERGER HRM587 – Managing Organizational Changes January 18th, 2015 Chrysler, Fiat and GM are OEM automotive producers. Both GM and Chrysler are considered one of the top automotive companies being GM number one and Chrysler who is lagging behind Toyota and Ford as the number four OEM automotive producers. However all three GM, Chrysler and Fiat were struggling to maintain and gain more market share. It was definitely a competitive in trying to gain more market share between GM and Chrysler. Fiat who is also an Italian OEM automotive producer also had its issue as well in keeping market share in Italy. Fiat also had their own issues in Italy with trying to stop the bleeding of losing money to where the Italian government had to bail them financially back in the day as well. So anyone would think that a merger between either of these companies could serve to be a win-win for both. But that only happen in one scenario. With both GM and Fiat struggling to hold market share in there perspective regions they decide to hold talks about the two companies merging. Sometime in 2000, GM and Fiat decided to enter into a joint venture or some may call it entering into an alliance. GM had acquire a 20% stake in Fiat and Fiat had acquired only 6% of GM. (GM Pays to Walk Away, 2005) GM entered into this alliance to try a save their Latin American Division from declining sales and Fiat entered into this alliance to try...
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...competitors increase in quality, technology, and innovation): i. Daimler – felt pressure to merge, ranked 15th largest automaker (only above Volvo & Porsche) ii. Chrysler – lack management depth, new products, and has small oversee market penetration c. Avoid consolidation due to global overcapacity d. Cope with changing marketplace and technology, such as the Internet e. Remain competitively priced by reducing cost (implementing “platform” design across DaimlerChrysler) f. Was it really “a merger of equals”? What went wrong? (see table and reference #2 – Muller, 2001) Issues faced by DaimlerChrysler after 1998 merger: a. How to leverage “soft” assets, such as Intellectual Capital in the form of Knowledge Management? b. How to resolve cultural differences between Daimler and Chrysler c. How to convince executives, managers, and staff to be open and remain loyal d. How can knowledge management be used to smooth the merger process * See reference #4 (Robb, 2003) for similarities between related KM acquisitions and mergers e. Is there enough resources or reason to adopt Knowledge Management * See Table A for comparison of companies that adopted KM Transfer of resources and capabilities: a. Economies of Integration: reduce costs and improve quality b. Economies of scope: obtaining synergies from transfer of core competencies i. Chrysler – known for innovation in design and marketing knowledge ii. Daimler – has brand equity and state-of-the-art engineering in R&D iii. Sharing of distribution...
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...DODGE DURANGO 2014 DODGE DURANGO 2014 MARKETING II Name: Tran Thanh Long ID: 1357030 Class: Tuesday Morning MARKETING II Name: Tran Thanh Long ID: 1357030 Class: Tuesday Morning Content: I/ EXECUTIVE SUMMAR II/ SITUATION ANALYSIS: 1. Dodge’s history 2. Product history 3. Describe Dodge Durango 2014 4. Product evaluation A. Industry analysis and Industry trend B. Product differentiation C. Sale history D. SWOT 5. Target market 6. Marketing objectives A. Need satisfying objective B. Long and short term sale market III/ ADVERTISING OBJECTIVES: 1. Product concept 2. Target market - Detailed description of target audience: Relationship between target market and target audience 3. Communication media 4. Advertising message I/ EXECUTIVE SUMMARY: Have you ever felt the power of a horse when you rode it? Imagine a herd of horses as they run through an open plain. You do not want to ride a herd of horses on the street, now you just need the new 2014 Dodge Durango. In this planner, you will be seeing, imagining and experiencing the unique way Dodge advertises using lower cost but still attracting more potential consumers of Dodge brand and Paramount Pictures, also you will get the information about the new Dodge Durango. "But for the most part, the Durango remains a stylish, aggressive-looking truck with available V-8 power, plenty of towing ability, and some new fuel-economy technology lurking...
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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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...Communities, and families of the Employees OMM 640 Keanon Alderson June 13, 2011 In an organization there will be times where certain decisions have to be made whether bad or good. The decisions will affect the company, stakeholders, and the employees in one way or another. Changes can come from many different factors. It can be changes to improve the company, compete with the competition, or the economy. Now and days the changes that many companies are making is changes due to the economy. Companies are looking to save money. Companies are cutting back the matching of the 401K, cutting back on employees hours, and some companies are even shutting down all together. We will be taking a look at how a wealthy popular car company, Chrysler, has filed for bankruptcy in this economic downturn which in turn has an effect on employees, the community, and the families of the employees. In the past two years America has been hit pretty hard economically. Gas prices have risen to almost 5.00 a gallon in some states. Peoples light bills have been as high as 500.00 or more. People have lost many jobs and can’t find a job because so many employers are cutting back to try and save what’s left of their company. Many homes are being foreclosed because people can’t afford to pay their house note because they don’t have a job or because there were cutbacks on their commission. Its many factors that have played a part in why the economy is the way it is today. One of the effects...
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...have experience with are Chrysler and Kia. My husband interviewed with Chrysler and was employed for several years with Mercedes Benz and is now going through the interview process with Kia as we speak. All of the named companies focus on quality management among other things. Quality management can be defined as different things to different companies. According to businessdictionary.com quality management can be defined as, “Management activities and functions involved in determination of quality policy and its implementation through means such as quality planning and quality assurance (including quality control)”. We have found that in which companies obtain good quality management is more important in some respects than the quality management itself. Both Chrysler and Kia have both established good quality management from the beginning of their entry into the United States automobile market. Both companies at first glance are seemingly competing on the same playing field however when you take a closer look you can see that Chrysler competes in the domestic market and Kia competes within the global market. Both Chrysler and Kia have similarities when it comes to quality products as well as preventing problems even though they compete in different markets. In 1925, Chrysler was organized as the Chrysler Corporation. Chrysler was the third largest automaker and established a name for themselves after WWII for well-engineered cars (Maynard, 2009). Chrysler history has not always...
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...CHRYSLEY CORPORATION When someone mentions Chrysler, what comes to your mind: Dodge Ram Truck, Sam Elliott or the unstable financial investments made by management at Chrysler? Several eras at Chrysler have had ups and downs, mostly influenced by ownership and troublesome economic times. The company has experienced the most trying times in the ladder of its existence. Encountering financial turbulence in the late 1970’s prompted a Congressional bail . This was all accomplished under Lee Iacocca, President and CEO of Chrysler in 1978. Iacocca stabled the near bankrupt company, allowing paying back the loan seven years earlier than expected. In 1987, the No. 4 automaker, American Motors, was bought by Chrysler and the consolidation was yet another financial crisis that lead to restructuring of the company . Chryslers 1990’s were a comeback with its Jeep lineup and vehicles like the powerful Dodge Viper. The company was acquired by Damler Bentz of Germany in 1998, and with inconsistent financial results the shareholders prompted Damler to seek a buyer in 2007. The company was sold to Cerberus Capital Management, an investment fund, which instilled Robert L. Nardelli as chief executive, formally CEO of Home Depot. Nardelli vowed a comeback for Chrysler being yet again an American owned company but suffered a deep sales slump and the recession took hold. In September 2008 sales were down 32.8 percent and prompted Chrysler to search for a merger partner, potentially with...
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...------------------------------------------------- Project Failures From the Top Down: Can Marchionne Save Chrysler When Chrysler merged with Fiat on June 10, 2009, there was cause for hope and optimism. After an endless string of bad news, perhaps, the auto industry was not dead yet. On paper it looked like a good deal for everyone. Fiat would return to the US market and sell its popular 500 (Cinquecentro), Chrysler would acquire a line of cars that consumers might actually buy, and tens of thousands of workers would keep their jobs. But the real prize might just be Sergio Marchionne, CEO of Fiat and now CEO of FiatChrysler. When he first became CEO of Fiat in 2004, Marchionne inherited a company on the brink of failure. It manufactured a lackluster product line and had suffered more than $12 billion in losses over the previous five years. To transform the company he embarked on several strategic and operational projects. He fired senior managers, upended a bloated bureaucracy, and brought a team of young aggressive managers on board. Then, he reviewed all projects and killed those that could not pass the market test. And he hired new designers, and demanded a portfolio of exciting projects that would bring customers back to dealer showrooms. In less than three years he succeeded in one of the most impressive turnarounds in automotive history. Now, as part of his plan to grow Fiat into a global competitor he has taken on Chrysler. But, can he perform his magic again? Can he save yet another company whose...
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...other corporate information. | | Download our app www.fiatspa.com/mobileapp 3 General Meeting An Ordinary General Meeting of Shareholders will be held at 11 a.m. on 31 March 2014 (single call) at Centro Congressi Lingotto, Via Nizza 280, Turin to vote on the following: Agenda 1. Motion for Approval of the Statutory Financial Statements and Allocation of 2013 Net Result 2. Compensation and Own Shares: a) Compensation Policy pursuant to Article 123-ter of Legislative Decree 58/98 b) Authorization for the Purchase and Disposal of Own Shares Attendance and Representation Shareholders are entitled to attend the Meeting if they hold the right to vote at the close of business on the record date of 20 March 2014 and the Company has received the relevant confirmation of entitlement from an authorized intermediary. As provided by law, shareholders entitled to attend the Meeting may also be represented by proxy. The Company has appointed Computershare S.p.A. (Via Nizza 262/73, Turin) as the Designated Representative, pursuant to Article 135-undecies of Legislative Decree 58/98, upon whom shareholders may confer proxy and instruct to vote on all or some of the motions on the agenda. Notifications of proxy appointment should be submitted to Computershare no later than 27 March 2014 using the form available on the corporate website (www.fiatspa.com – Investors/Shareholder Corner/Shareholder Meetings/Proxy Form to Computershare S.p.A.). The form can also be requested by calling +39...
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...portions of the market, red oceans and blue oceans. This separation is very important to understand and must be discussed in-depth. This will be followed by an introduction to Chrysler Group LLC, which consists of Dodge, Chrysler, Jeep and Fiat. However, there will be a focus on Fiat and Dodge as they have two small compact vehicles that appeal to a niche market. Blue ocean strategy can change where Chrysler Group LLC stands in the automotive industry and make for a much more profitable organization. Red Oceans Versus Blue Oceans Red oceans and blue oceans are extremely important to understand, otherwise the whole Blue Ocean Strategy would not make any sense. Red oceans is where competition is fierce between competitors trying to make their product stand out the most by differentiation or price. Red oceans also consists of all competitors trying to take advantage of demand that exists in their market. Blue oceans are completely opposite with the largest focus being on making the competition irrelevant. Blue oceans also focus on creating new demand instead of competing for it, which results in the creation of unchallenged market space ("Blue Ocean Strategy", 2012). Chrysler Group LLC Chrysler Group LLC is one of the U.S. automotive industries leaders which is comprised of the Dodge, Chrysler, Jeep and Fiat brands. This industry is very competitive with the Ford Motor Company and General Motors leading the pack. It is obvious that all three of the companies are competing...
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...Alternatives 12 Decision Criteria 14 Implementation 16 Contingency 19 References 21 Exhibits 22 Executive Summary Alfa Romeo, a company steeped in automotive performance history is being evaluated for re-entry into the North American and specifically Canadian consumer market. The company was founded in 1910, and has been producing high performance vehicles to present day. To-date its sales focus has been focused on the European market, with over 90% of units sold in Europe. It was acquired by, then Fiat Group, in 1986 from this acquisition a partnership was brokered between Fiat and Chrysler Motor Company in 1988 for exclusive rights to sell Alfa Romeos through Chrysler dealerships from 1988 to 1995, at which time Alfa Romeo pulled out of the North American market. In 2015, due to the recent partnership between Fiat and Chrysler and the creation of Fiat Chrysler Automotive Group, Alfa Romeo is returning to North America. Three key problems have been identified that must be overcome for Alfa Romeo to be successful in the Canadian market place and North American market overall. The first is to develop strong brand recognition, the second is to achieve market share in the North American and Canadian market specifically, and finally the venture into Canada and North America must prove to be profitable. From the analysis, it is evident that as in Europe the North American and Canadian market is fierce with competition. There are currently many strong contenders...
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...The Automotive Industry Recovery Prepared for: Transmittal Letter TO: FROM: DATE: SUBJECT: Report Overview The following report discusses the automotive industry recover from the “Great Recession” that occurred in 2008/2009. Information presented will be the state of the automotive industry before the recession, after the recession, how the industry is doing now and how the future looks for automakers. Contents The Automotive Industry Recovery 1 Transmittal Letter ii Contents iii Figures iii Executive Summary iv Introduction 1 Finding 1 Pre-Recession 1 Post Recession 2 How is it now? 3 The Future Outlook 3 Analysis 3 Summary 3 Conclusions 4 Reference 5 Figures Figure 1, Annual Auto Sales in the U.S. 2 Executive Summary The Automotive Industry was hit hard by the “Great Recession”. Jobs and sales declined rapidly as the economy and Americans were coming up short financially. After a couple years and some restructuring the automotive industry started making a comeback. Increasing sales by focusing on consumer needs helped bring workers back to work. Now the industry is booming again with continued growth in the future. The Automotive Industry Recovery INTRODUCTION PURPOSE The nationwide effect from the Great Recession on the auto industry was apparent everywhere. With the bail-outs of some of the big auto makers and loss of jobs, the economy really went into a slump...
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...obtain employment in the automotive industry and earn what was considered a competitive wage. The internal and external challenges for the FCA LLC (Fiat Chrysler Automotive) company in recent years have caused the company to take on a systematic approach to building and maintaining a profitable business. The discovery of the root cause for the FCA turn around can be found in the leader CEO Sergio Marchionne. In the paper, we will review his top three leadership practices, and perform SWOT analysis of the FCA- North America organization. The FCA- North America LLC has its headquarters in Auburn Hill, Michigan. The FCA- North America divisions include SRT, Dodge, Chrysler, and Ram. The primary products made by this company are SUVs, trucks and automobiles. The Dodge autos include the Dart, Challenger, Charger, and the Avenger. The Chrysler autos include the 200, the 300, Town and Country. The Ram Truck line includes Ram 1500, 2500, 3500. The SUV lineup is Jeep, Dodge Durango. The FCA- North America LLC product has a target of the general public as well as the commercial side to meet the needs of the business sector. In 2006, Chrysler Group LLC was in a terrible financial position and filed for bankruptcy. Chrysler Group LLC was too big to fail was the excuse that led to the U.S. Government to be part owner in the Chrysler Group LLC. Part of the restructure agreement, was the Fiat S.P.A. was, in short,...
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...Tapping the full potential of ABC Joseph A. Ness Thomas G. Cucuzza Many companies have used activity-based costing (ABC) in onetime profitability studies to help them decide which products or customers to cut or keep. But ABC can be much more than a superior accounting technique that shows how much money individual products are really making or losing. When ABC is woven into critical management systems, it can serve as a powerful tool for continuously rethinking and dramatically improving not only products and services but also processes and market strategies. To use ABC in that fashion involves managing in a radically different way. And that, of course, means the people in a business—from the CEO to frontline workers—must change radically, too. No wonder so many companies have found activity-based management so much more difficult to implement than they had imagined. Thousands of companies have adopted or explored the feasibility of adopting ABC. However, we estimate that no more than 10% of them now use activity-based management in a significant number of their operations. The other 90% have given up, or their programs are stagnating or floundering. The problem is that managers often do not think of activity-based management as a major organizational-change program. It is. Combing the organization to pinpoint all the useful information about the direct and indirect costs of a product or service is a huge undertaking. So is setting up an information system that can track...
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