Nissan Renault Essay

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Why is Renault seeking a strategic partner? What are Renault’s strengths and weaknesses in seeking a partner? The most successful strategic alliances are between companies with complementary strengths and weaknesses. Renault has been building cars since it was started under the name Société Renault Frères. Louis Renault, his brothers Marcel and Fernand, and his friends Thomas Evert and Julian Wyer founded it in 1899. Since the beginning they have been an industry leader in small car designs, combining functionality with style. In 1998 Renault was the world‟s ninth-largest car manufacturer with 4.3% of the market. During the 90‟s globalization was occurring in all industries including the automobile industry. Major manufactures were seeking strategic alliances and mergers as ways to increase market share, reduce costs, and improve productivity. Renault has been an established French automaker since it started producing cars in 1897. Like many other companies Renault has been looking to expand into the Asia for its large potential market. They felt that the best way to do this was through a strategic alliance. Renault has been looking for another automobile manufacturer to peruse a possible alliance with since the early 90‟s. From February 1990 to December 1993 Renault attempted a merger with Swedish car manufacturer, Volvo. It was expected that the merger would go through, than in December of 1993 Volvo shareholders voted against the agreement. This was a big loss for Renault, not only had they lost the opportunity to merge but they wasted time and money in the pursuit. Renault felt that it was now five years behind in the race to gain international stature. Renault‟s main objective in finding a strategic alliance partner was to increase their market share by selling cars in new markets in Asia and North America. As you can see on Appendix 2, in 1998 Renault did

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