Cars in the Industry Essay

375 WordsJul 25, 20142 Pages
These challenges in the plans can be hard to overcome. This is why ensuring that the plans drafted for the future allow for issues as these, and backup plans can be inserted is necessary. There are many threats that can hinder a long term partnership. One I can name is the alliances that were being formed. Many companies were looking to compete which means that they also looked for alliances to help make them stronger. There was Renault SA which formed a joint venture with Mahindra and Mahindra Ltd. They helped create the Logan, which was able to compete against the Indigo. Another threat was GM India who was able to improve its share in India as well with the Chevrolet Aveo. All parties have to have input and look for ways to improve the plan constantly which means open communication is needed to keep a great partnership moving forward. This would help strengthen its global initiatives. Evaluate the business case for a joint venture strategy. Joint ventures are on the rise because of the high success rate. The main reasons for doing so are: 1. Helps to reduce costs 2. Provides access to various markets in the industry 3. Puts a foot in the foreign arena 4. Looks to reduce risk 5. Access to new technology 6. New brands. When deciding on a joint venture you have to plan ahead. This means that Tata and Fiat needed the following; 1. Commercial Issues 2. Governance Structure 3. Operating Agreements 4. Breakup Plans Since joint ventures do not normally last long, due to issues such as trust, everyone must be transparent with their ideas and expectations from the beginning in order to make things work. Deadlines should be met and all decisions must be agreed upon before changes are made. This is why Tata and Fiat needed to think this through before moving forward. They needed to work slowly if they wanted to combine

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