Fiat Auto acquires Chrysler: A growth strategy? Conduct outside research and prepare a 3-4 page document, double spaced in APA format, (cite sources on a separate page) concerning the following: Your...

Introduction
FIAT is one of the major companies in automobile industry. It was started in 1999 by a
group of investors including Giovanni Agnelli. Giovanni Agnelli led the company to success till
1945 (Official website of Fiat, n.d.). Under his leadership, FIAT became Italy’s top most car
manufacturer. Since then there was no looking back. In contemporary context, the most
important decision taken by the Fiat is its acquisition of stakes from Chrysler. In 2004 after
Sergio Marchionne took over as CEO, he tried to bring back the success to Fiat. Fiat’s losses
were depleting since 2002 and in 2005 it saw first profit after 4 long years (Official website of
Fiat, n.d.). He is said to be the modern profit maker for Fiat. He reduced the bureaucratic
management in Fiat and changed the focus to profits and market. To be one of the top 5
Automobile manufacturers in the year of 2009 Chrysler and Fiat plunged into an alliance. The
deal was made that Fiat will be taking over control of North America dealership from Chrysler
and in return Chrysler will facilitate technology for fuel efficient vehicles. This alliance has
much relevance to Fiat in terms of branding, trust, market share, profit as it has to compete with
the global giants like Toyota and Volkswagen. In the end of 2009, Sergio Marchionne became
the CEO of Chrysler and transformed Chrysler into a Fiat like manufacturing company having
large scale production of vehicles and completely revamped from old technology and models.
This study will focus upon the strategic alliance between these two companies and analyze the
impact of the alliance, relevance of the alliance based on the external environment and how it is
internally structured to meet the changes.
The general environment
The general environment for Fiat can be analyzed by conducting a PESTEL analysis. The
six aspects which can be considered for the Fiat are as below.
Political: International oil price increase adversely affects Fiat by affecting its sales.
Political unrest in Middle East also impacts Fiat sales as...