Daimler Ag and Saab

Topics: General Motors, Fiat, Daimler AG Pages: 10 (4091 words) Published: January 19, 2013
Chrysler was founded in 1925 and it has had a joyous history. Being the third-largest of Detroit’s auto companies it was especially known for its development in well-engineered cars the years after World War II. As of the last three decades it has been experiencing both highs and lows. The unlikely union of Chrysler and Fiat to me seemed to be a bigger mistake than that of the Chrysler and Benz merger (" daimler, chrysler," 2008). Fiat took control of Chrysler after it emerged from its government-sponsored bankruptcy in 2009 (VLASIC, 2012). In 1938, the Saab factory was built in Trollhattan Sweden. At this time, they were not an automobile manufacturer. On the brink of the biggest war the world had seen (World War II), the Royal Swedish Air Force needed to develop an aircraft. It wasn’t until 1947 that the first car was developed (the Saab 92). Soon after the development of the Saab 92 it quickly became a reputable name for building safe and reliable cars (Saab Group, 2010). I was unaware of this merger but as CNN states “Automotive traditionalists are understandably upset that a brand with a long and storied history like Saab has wound up on the financial chopping block.” In 1990 GM bought 50 percent of Saab it is believed that most of the blame for Saab's failure is GM’s fault (Taylor III, 2011). Both Saab and Chrysler were in a position where they both needed to be rescued. The facts are that the Saab and GM merger were all at a loss before the merger began. As I have read the financial crisis that our economy has just passed placed both companies in compromising positions. The truth about cars states that “…Saab was going through its traumatic divorce from GM and troubled rescue attempt.” So at this point GM saw an opportunity to establish itself in a new region and expand Saab. So In 2000, GM bought out the present Investor of Saab. In no time, Saab had already begun to see a succession of short-term, GM-appointed chiefs (Dave Herman, and later, Bob Hendry) Things started good but never stayed long enough to complete the rebuilding process ( AUTO OBSERVER STAFF, 14). So as I see it the problem with the Saab merger is that there was not much consistency in the new found acquisition. In the case where Chrysler and Daimler-Benz are concerned this merger was viewed to be the best of both worlds. “Originally, the plan was for Chrysler to use Daimler parts, components and even vehicle architecture to sharply reduce the cost to produce future vehicles. But problems surfaced when Daimler's Mercedes-Benz luxury division, whose components Chrysler would use, was averse to contribute to Chrysler. Eventually, all Chrysler got were some steering and suspension components, a transmission and a diesel engine and few packages. (Woods, 2011) ” In essence Chrysler was being ousted, played for lack of a better word they were being SHAFTED. As aforementioned both companies needed so sorely to be rescued. Saab was drowning in the regional completion, producing the fewest amounts of cars in the caliber of market they were geared towards and Chrysler had recently filed bankrupt. Also in both cases the change that occurred affected the employees on all levels in every department. Were these companies differ is how they worked with their parent company during the merger. The way I see it is that no matter what Saab did, they had no alternative for help and they actively tried to engage with GM to avoid closing the company. In Saabs situation they were at the mercy of GM, and whatever or however GM saw to deal with Saab, Saab had no say so. In the case of Chrysler and Daimler-Benz there was a clear synergy issue. Daimler thought that it could put or invest little communication into Chrysler and use the company how they saw fit, Chrysler thought otherwise. The director image believes that success and change outcomes as being achievable and strategic. For Chrysler they were in my opinion very tactical in regards to how they allowed...

References: 1. Taylor III, A. (2011). Saab without tears. CNN. Retrieved from http://money.cnn.com/2011/12/20/autos/saab_general_motors.fortune/index.htm
3. VLASIC, B. (2012, January 09). A merger once scoffed at bears fruit in detroit. Retrieved from http://www.nytimes.com/2012/01/10/business/chrysler-and-fiat-merger-shows-fruits-of-teamwork.html?_r=0
5. Saab Group. (2010). A history of high technology. Retrieved from http://www.saabgroup.com/About-Saab/Saab-History/
7. AUTO OBSERVER STAFF. (14, September 2011). If saab finally done, end began 20 years ago . Retrieved from http://www.autoobserver.com/2011/09/if-saab-finally-done-end-began-20-years-ago.html
11. Woods, L. (2011). Streetdirectory. Retrieved from http://www.streetdirectory.com/travel_guide/53007/car_focus/how_daimler_chrysler_merger_failed.html
19. Holweg, M. (2011, December 12). Why saab had to die. Retrieved from http://www.forbes.com/sites/frederickallen/2011/12/20/why-saab-had-to-die/
21. Baltimore Business Journal. (2009, November 2). Black & decker ceo nolan archibald 's letter to employees. Retrieved from http://www.bizjournals.com/baltimore/stories/2009/11/02/daily14.html?page=all
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