The DaimlerChrysler Merger
In 1998, Daimler-Benz AG and Chrysler Corporation were coming together as a "merger of equals. The DaimlerChrysler fusion created revenues of $132 billion with approximately 440,000 employees.
Car Industry since the Beginning.
In the second half of the 20th Century (after WWII), car manufacturers focused on manufacturing more sensible and efficient cars; Japanese manufacturers were winning this race and by the end of the century, they were more than twice to more than 10 times as efficient as its other competitors.
In order to survive, car companies optimized their operations within a few years.
The Worldwide Market for Cars and Commercial Vehicles
During the past 5 decades, the world population has doubled; the number of cars increased to 500 million units. The global market for motor vehicles has grown from 46.4 million units in 1993 to 50.9 million units in 1998.
The three main regions, North America, Western Europe, and Japan, are the most important markets. These markets expected expansion to Asia and Latin America; but, due to currency volatility, high inflation, and competitive pressure, developing markets have proven difficult. Moreover, there were only a few profitable market niches left and lowering production costs wasn't enough to satisfy customers.
Trends of the industry
Overcapacity: Cause of the closing or 30 plants in the U.S. and Canada.
Continuing overcapacity has decreased the number of car companies. In 1960, a total of 42 independent car manufacturers existed; by 1999, only 17 remained.
Changing Role of Suppliers: Suppliers were required design, development, and production according to the strict quality standards, not just only supplying batches of parts to ...