Managing the intercultural issues in automotive industry mergers and acquisitions
"Alexandru Ioan Cuza" University, Iaşi, Romania
PROCEEDINGS of
North International Conference of Economics,
Issue 1 / 2016,
pp.291-299
ISSN 2537-317X
ABSTRACT
Mergers and acquisitions are a strategic choice to grow quicker, enter new markets and
maximize companies’ capabilities which otherwise would not have been possible. Within the
automotive industry this phenomenon has been seen repeatedly with examples like the
Mitsubishi - Daimler, Jaguar - Ford, Daimler-Chrysler, Seat-Volkswagen, Daewoo-General
Motors and Land Rover -Ford. Although M&A activity has trended directionally consistent
with automotive assembly volume, there are some failure cases within automotive industry
M&As (e.g. Rover-BMW). In this paper, the focus will be on the intercultural issues of the M&A
phenomenon: attitudes, cultures, values, tradition etc. The underestimation of the cultural
factors has significant impact on why M&A operations sometimes fail to achieve the predefined
goals. It is of vital importance for the automotive companies to understand and be
aware of these intercultural issues in order to be successful in their merger or acquisition. The
understanding and awareness of cultural differences have to be built and developed in order to
avoid cultural conflicts and clashes.
Keywords: mergers and acquisitions (M&As), intercultural, cultural differences, automotive industry
