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Chrysler Daimler Harvard Business School Case Study

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Chrysler & DaimlerAcquisition-Merger Case Study | |
Situation faced by company
After facing some hardships and bad acquisitions in the 80s and 90s, Daimler-Benz led by Jurgen Schrempp began to see the light in the mid-90s. By focusing on the most profitable businesses within Daimler and reducing the number of businesses at Daimler from 35 to 23, Shrempp was able to post high profits in 1996 and 1997 despite the poor looking financials in the previous years. In order to remain profitable in this highly competitive market, Shrempp knew that the company had to continue to grow. They needed to reach customers down market without compromising their high-quality brand. To do this, they began selling vehicles to the market’s premium niches and were quite successful. Along with broadening their product offering, they were becoming more and more international with their production because of the high amount of revenues being generated internationally. Schrempp knew that these steps would only keep them competitive for so long though. With the nature and frequency of alliances and mergers in the automotive industry becoming more and more frequent, he knew that to keep up with the changing industry and increased time and cost pressures, he had to take another step in order to not fall behind the competition.

SWOT analysis Daimler-Benz | Strengths * Attention to detail * Brand image * Engineering * Global distribution network | Weaknesses * High-cost & inefficient production methods * High labor costs | Opportunities * International expansion, specifically in the U.S. * Increasing demand for premium vehicles in developing nations * Technological advancement | Threats * Volvo, Scania, Audi, BMW * Lower-priced brands upping their quality to attract Daimler’s customers * Volatility in fuel prices * Economic downturns *…...

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