Cars

Meineke Car Care Centers, Inc. is an automotive franchise company. This company serves as the provider of automotive business training and field support, as well as range of automotive repairs and services. Formerly known as Meineke Discount Muffler Shops, Inc this company was by Sam Meineke in 1972.

The first store was located at Charlotte, North Carolina until the business was sold to a multinational British company. Originally, the concept of Meineke Car Care Center was to provide workmanship and quality products at a very affordable price. With only one store and single product line, the business grew rapidly, making the brands known in the global market (BusinessWeek).

The company name was changed to Meineke Car Care Centers, Inc and the company has been recognized as one of the most trusted brands in America. Meineke repositioned its business from product and service provider to a complete car care center with full range of vehicle services to offer to the customers (Meineke).

Product Lines

Recognized as provider of quality products and services in the market, Meineke gain the loyalty of the customers from different parts of the world. The company was able to gain a reputation and credibility for offering quality brands that are now more preferred by the market. Meineke offers wide range of products and services to the customers.

Meineke products include exhaust systems wheel alignment, wheel balancing, strut mounts, coil and leaf springs, steering stabilizers, rack and pinion, motor cushions, CV shafts, oil and filter change, air filters, lift supports, water pumps, brake systems, wiper blades, motor and transmission mounts trailer hitches, belts, serpentine, tire rotation, cooling system, flush, hoses, front end parts, thermostats, radiator caps, batteries, v-belts,  transmission flush, air conditioning systems, shocks and struts, tires, tune-up, fuel injection, radiators, and steering and suspension systems.

The company’s services include catalytic converter, wheel alignments, windshield wiper blade replacements, CV joints/boots, A/C, oil and lube service/filter changes, steering, tire balancing, tire rotation, transmission flush, tune ups, fuel injection cleaning, brakes, cooling system services, and auto glass. With these products and services, Meineke was able to build strong foundation in the marketplace. From the small store and single product line, the company is now offering these products and services, reflecting the success of the business in the global market.

Current Location

The rapid growth of the business in the emerging market has gone to innovations of more products and services and penetration of wider customers. Today, Meineke operates not only in United States but also in different countries across the globe. Many people have already franchised the business but the company continuously develops new products and services to retain a productive relationship with the customers. With a promise of customers’ satisfaction, Meineke was able to add more stores in different locations and constantly growing in the emerging market.

Meineke has locations in the United States, Venezuela, Central and South America, Mexico, Ecuador, Guatemalan, the Dominican Republic, Canada, and Caribbean. Due to consistent success of the company in every location, Meineke is still planning to penetrate new markets to offer the products and services to potential customers in other countries; in fact, Meineke plans to penetrate another country and the company develops a strategic marketing plan to maintain the success of the company in the global market.

Global Business Strategy

Short-Term Goal

The company aims to penetrate new market and the following activities will be included in the short term goal of the company.

• Conduct a research about the new target markets.
• Find the best location where the company could place the stores.
• Develop marketing plan based on the information gathered for marketing research
• Build rapport to the new target market.
• Conceptualize effective promotional techniques and develop persuasive advertisements.
• Plan the distribution process for easier transaction.

Long-Term Goal

To be recognized as the best provider of automotive products and services in the global market. Outwit the competitors by gaining the loyalty of the customers and recognition and awareness of the customers of other companies. Expand the business by building more stores and offering new product lines and services. To be recognized as the market leader.

Assets to Achieve the Company Goals

The reputation and credibility of the company for providing quality products and services can already be considered as great strengths in the marketplace. The fact that Meineke has already numerous stores in different locations will serve as the company’s steeping stone in the global market. Many people have already franchised the business and brought the name of the company to numerous places, serving the people and letting them experience the high standard quality that the Meineke offers to the public. Apparently, the strength of the company comes from many sources which enable them to grow rapidly in the marketplace.

The name recognition which is gained from over thirty years of service to people has helped the company to be considered as the market leader despite the existence of the competitors in the market. The company also reassures the customers with nationwide warranty and standardized level of excellent service and quality (Bison). Through constant effort of developing new products and offering superior automotive repair services at discount prices, the company was able to gain the loyalty of the customers which lead to increasing demand of Meineke’s product lines and demands.

Initial Location Strategy

In order to expand the business globally, the company needs to look for another location where Meineke can penetrate the market. Market penetration is applied by business firms if the company will offer new products in the existing market or if the company will place a new store in a new location (Kerin et al, 310).

In the case of Meineke, the company needs to study which country would be the subject for market penetration to offer the products and services to entirely different groups of people. Definitely, Meineke aim to penetrate new market not only for profit and revenue purposes but also for global expansion and nationwide name recognition.

Global expansion can be the reflection of the company’s good reputation in the marketplace; however, this strategy needs creative concepts to make the business survive in the new market. Regardless of the experience and brand recognition of Meineke in the market, the new market may not bite the products and services that the company offers to the public. This is the reason why, the company needs to analyze which country should be targeted for the business offers.

Better than the outgoing model in every way, the all-new BMW 3-Series won’t increase much in price when it goes on sale later this month. The 2006 325i will start at $30,995, only $1,695 more than the 2005 model, despite featuring an entirely new design, upgraded 3. 0-liter inline six-cylinder engine that now makes 215-horsepower compared to the 2005 models 184-horsepower rating, a new six-speed automatic transmission with manual mode, enhanced chassis engineering, and steering geometry, a totally revised interior, and more.

The top-line 330i is improved too, featuring all of the 325is upgrades plus an all-new 3. 0-liter engine that produces 255-horsepower compared to the outgoing models 225-horsepower rating, while torque is up from 214 lb-ft in the current car to 220 lb-ft. Like the 325i, the 330is base price will rise when it goes on sale, but only by $1,295 to $36,995. Both new engines are the first in large-scale series production to incorporate magnesium as the main component, a metal that is 30 percent lighter than aluminum. The engines are also the first six-cylinders in the BMW family to make use of Valvetronic, the brand’s variable valve timing system.

Other option groups include the $2,200 Navigation package, up to $400 from last year’s navigation system, but now featuring integrated voice recognition for hands-free actuation of ancillary functions. A Cold Weather package, at $1,000, the same price as last year’s version, adds a ski bag, fold-down rear seatbacks, heated front seats, and retractable headlight washers. A Premium package, available on both models, is priced at $2,900 in the new 325i compared to $2,300 in the outgoing car. It features the same power glass sunroof, leather-covered 8-way power front seats and driver-side memory, and Harmon/Kardon LOGIC7 audio system.

The new model also features power-folding mirrors in premium guise. The Premium package for the 330i is priced the same as last year’s version, at $2,200, and features everything that is available on the 325i Premium package, less the power seats with drivers side memory, which come standard on the 330i. Other Premium features include a universal garage door opener, auto-dimming exterior mirrors, driver’s seat lumbar support, a compass in the mirror, Dakota leather seats and trim replace Montana leather seats and trim, and a Harmon/Kardon LOGIC7 audio system.

The 2006 3-Series is also available with a Sport package, just like the 2005 model. At $1,600, it is $200 more expensive than the outgoing cars and continues forward with updated versions of the same features, such as sport seats with electrically adjustable seat width, a 3-spoke leather-wrapped steering wheel, and 17-inch alloy wheels, plus a sport suspension. The only difference, feature to feature, is the addition of performance-oriented run-flat tires. The price of the 330is Sport package has increased from $1,400 in 2005 model year vehicles to $1,600 in 2006, and also features the new run-flat tires.

Other stand-alone options don’t rise in price much either, and in the case of the new 6-speed automatic transmissions extra forward gear offers major improvements in design and engineering. That transmission only goes up by $225 at $1,500 compared to the 2005 models $1,275 optional gearbox, while the Dakota premium leather upgrade will cost $1,450, the same price as the 2005 cars Montana leather package. Park distance control is once again $350, while metallic paint remains a $475 option.

New for 2006 will be adaptive headlights, which point a set of bulbs in the direction the car is turning, active cruise control at $2,200, which will automatically slow the 3-Series down when approaching a slower vehicle, and active steering, a $1,250 feature that essentially adapts the steering ratio to vehicle speed, but its electric-motor-assisted, planetary-gear-motivated rack-and-pinion system is much more sophisticated than conventional speed-sensitive steering counterparts, common to luxury cars of all stripes.

Steering response to input is much quicker than any other car, at about 1. turns lock to lock, making maneuvering into, around and out of tight spaces such as parking lots incredibly easy. To put this in perspective, most cars need about twice that amount to turn the wheel from full left to full right, or about 3. 5 turns lock to lock. The reason for this is so steering input isn’t too direct at high speeds. At 1. 7 turns a car traveling at highway speeds would simply dart off the road with minimal input, not a good thing. Active Steering, however, electronically and mechanically adjusts the ratio to about 4 turns lock to lock when velocities demand.

Both the 325i and 330i will be available with BMWs xDrive all-wheel-drive system in October, which is when the new 3-Series Touring, a sports wagon derivative will arrive in dealerships. While there is no word on pricing for the 325xi or the Touring version, expect each model’s final window sticker to remain close to 2005 levels, if the pricing of sedan models is any indication. BMWs aggressive pricing strategy will help it maintain leadership in the compact premium class, a position it has enjoyed since the first 3-Series debuted in 1977.

There are four main periods in a product life cycle concept which begins with the introduction stage, followed by the growth stage, then the maturity stage, and finally the decline stage. Naturally and comparatively, there are distinct characteristics which would qualify a certain product to be under a specific stage heading. For example, in terms of marketing objectives, a certain commodity which is at the introductory stage opts to “create product awareness and trial,” while at the growth stage, it changes and shifts to “maximize the market share” (Kotler, Keller, Ang, Leong, & Tan, 2006, p.344).

In terms of advertising, a commodity at the maturity stage chooses to “stress brand differences and benefits,” while at the decline stage, it alters to “reduce to level needed to retain hard core loyals” (Kotler et. al. , p. 344). In many of the general definitions and processes, these attributes apply to mostly all companies but vary in intervals: “In Sweden and Britain, automotive product life cycles are eight years, while in Japan they are typically only four years long” (Author’s Last Name, Year, p. 304).

In the implementation of a seven year product cycle, BMW has devised a unique system which demonstrates superb marketing skill and judgment: “To keep products in the introductory and growth stages, BMW regularly introduces new models for each of its series to keep the entire series ‘new’” (Author’s Last Name, Year, p. 304). As explained, “for instance, with the 3 series, it will introduce the new sedan model one year, the new coupe the next year, then the convertible, the station wagon, and the sport hatchback” (Author’s Last Name, Year, p.304).

BMW has managed to use the outline of the product life cycle concept but has ingeniously used the stages to full potential. As BMW utilizes the series system classification, it not only helps present variety in appealing to more segments of potential buyers, but the classification differentiation also carries on the brand in quite literally an automobile genre of its own prestige.

Being a luxury car brand that makes use of such a practice, the rarity and distinctiveness of the units within the specific series kept for a period of time are better highlighted, for there is a sense of prestigious-novelty preservation. As stressed by the Vice President of Marketing, Jim McDowell, this fits very well with company’s business hopeful ambition: “BMW doesn’t aspire to be the world’s largest car company, we already are and we want to continue to be the largest premium company” (McGraw-Hill Irwin, n. d. ).

This means that as a new model is introduced in a separate series, the other relatively previous series is still kept competitive within its identified market. In addition, further introduction of other new model series from the sedan to sports car series not only provides the whole product offering of the automobile series with a maintained and secured status of a current and still relevant significance, but an emphasized recent-to-latest mentality unto the customer—potential, present, or otherwise—is also most evidently put forward in terms of the overall company product offering.

This predetermined product cycle strategy development keeps a certain series’ credibility prestigious, which enduringly and wholly translates into the individual product unit purchased by a customer, as it both implicitly and explicitly speaks of and displays a distinguished sense of class to that series where that unit and owner belongs.

Moreover, BMW units are universally exclusive in every facet: “BMW’s positioning strategy is the same worldwide and that is to offer high performance, luxury vehicles to individuals. ‘You won’t see it as a taxi or a fleet car’” (McDowell cited in McGraw Hill, n. d. ). This association of sustained prestige within and amongst the series is shown and dictated by administering and handling of product introduction and growth by the company.

Advertising Lexus in a Luxury Market

    The new Lexus will be marketed an advertised as a more upscale car in the luxury market. In the automotive world, the epitome of luxury is to have one’s own chauffeur. Therefore, the advertising campaign will revolve around the idea of having a chauffeur. It should be marketed to consumers who are older, responsible, and who won’t see this car as a way to get out of driving altogether. The Lexus LS500-AA should be marketed as a luxury brand for an already responsible consumer.

    In order to develop an advertising plan, the first consideration is the consumer Lexus is trying to reach. This consumer will be a professional, capable of purchasing a luxury car and driving it responsibly. The next consideration is to determine what Lexus is trying to say to the consumer. This is simple: the consumer should know that the new Lexus is the epitome of luxury vehicles. The luxury market is all about fulfilling dreams. Consumers see these items as representing the pinnacle of success.

When consumers are asked to describe their spontaneous associations with the concept of luxury, the theme of “dream” almost inevitably emerges. In the world of luxury brands here’s how it goes: awareness feeds dream, purchase makes dream come true, purchase redirects dreams to the next object. (Twitchell, 2002, p. 189)

 The advertising campaign will start with a commercial. It will show a series of cars leaving houses for work. One will be the Lexus LS500-AA. The other cars will be in the background, while the LS500-AA will be the focus of the commercial. It will enter the highway, speed up, slow down in traffic, and only after it has demonstrated these new features, the camera will focus on the car’s owner – sitting in the backseat, eating breakfast. Just then, the driver wakes up in bed, smiling. This has been a good dream. The voiceover will say, “The car of your dreams: the closest thing to having a chauffeur”.

    The next part of the advertising campaign involves how to reach the consumer. In addition to commercials, current Lexus owners will receive a brochure in the mail showing the new car and its amenities and information on how to contact their dealer to schedule an exclusive test drive. The campaign should target men and women in their thirties and older. Lexus should offer radio advertisements on talk-radio stations that appeal to an older crowd.

    Public relations can be tricky, as the right spokesperson is needed in order to position this car as the height of luxury.

One of the criteria often included is the audiences’ attitude toward the announcer. As mentioned earlier, a nouncers who are well-liked celebrities are apt to distract listeners, but these characteristics need not be present simultaneously. (Clark, et. al., 1994, p. 192)

In order to present the car as the newest thing in the luxury market, a spokesperson must be selected who represents class and who is well-liked. Unfortunately, a person who truly meets these criteria will not be interested in promoting a product. These days, most celebrities have a product which they endorse. A good selection might be a well-respected actor or a popular businessperson, such as Donald Trump (once he resolves his current public relations problems, of course).

    The most important part of the public relations will take place at the dealership. Consumers who enter a dealership and ask about the new car should be treated with the utmost respect. Current Lexus owners should be called to make an appointment to view and test drive the new car.

Works Cited:

Clark, E. M., Brock, T. C., & Stewart, D. W. (Eds.). (1994). Attention, Attitude, and Affect in Response to Advertising. Hillsdale, NJ: Lawrence Erlbaum Associates.

(2007). Lexus. Retrieved January 19, 2007, from Lexus Web site: http://www.lexus.com/

Twitchell, J. B. (2002). Living It Up: Our Love Affair with Luxury. New York: Columbia University Press.

Advertising plays a major part in the sale of many objects, from daily needs such as food, to things that aren’t a necessity. Each advert has a different target audience and we can tell this by looking at many things in the advert, such as the amount of copy and the language that is used. The companies look deeply into the meaning of their adverts through research and studying what people want, and then put these ideas into the advert itself. They use many different techniques to get across their points, and make the customer want to buy the product on offer.

By exploiting the customer, they can make them think that they need a product, when actually it isn’t a necessity. There are three main types of advertising, using moving pictures on television, using still pictures in magazines and newspapers, by speaking on the radio and also by word of mouth. The two that I am going to concentrate on are moving image and still image. The moving image advert that I have chosen is “In the nick of time” which advertises a new Audi car, which was shown on television in 1989.

The advert is very well produced, as the person viewing it doesn’t immediately know what it is actually advertising. It could be a wide variety of things, and this makes the customer more interested and wanting to know what it is that is being advertised. The advert is a narrative, and the main story is that there is a young boy and an adult who are rushing somewhere. We don’t know where they are going, or who either of the two are until the final few seconds of the advert.

The story that is being told throughout the advert could be, at first perceived as being very sinister, as throughout the advert it point towards bad things going to happen, such as the dark mysterious man walking the street. This adds to the whole effect of the advert, by promoting the safety of the car, and how reliable it is. The car can also be described as a family car, but at the same time it is speedy. It uses the latest technology, and is mainly aimed at people who are fairly wealthy, and we know this as at the beginning of the advert there the man is in a large and expensive house.

It represents the end of an era that saw many yuppies, who were only interested in power and money, but this car is a family car, yet also for a professional businessman who is in touch with his feelings and his family, called “New Man”. It is almost saying that although having money and status are important, so is looking after your family and being with them. I have chosen a few still shots from the advert, to explain how they have used techniques, such as the angles of the shots, and tried to get details of the car across to the customer, such as how safe it is.

All of the stills that I have chosen are very sinister, as I want to stick to this side of the advert. The first still that I have is the man getting his coat. There is a dark shadowy figure in the background of the shot, and we cannot make out what the man is actually doing. This shot is low key, and they have it like this because it is more imposing, as the shadows make the shot look like something out of a horror movie. It is also of a low angle, looking up at the man, and this adds to the effect of the shot, as we don’t immediately know what the shot is.

The man has hard lighting surrounding him, so that he looks very sinister and is different to the front of the shot, which is soft lighting. The second still that I have chosen is when they have arrived in the town, as this again links in with the sinister theme throughout the advert. In this shot, it is at eye level and is low key, which creates a shadow around the car, and also to the left and right of the car it is very dark, and this links in with the image of the car, it being safe.

The third shot that I have chosen is about half way through the advert, and in this shot there is a man in a tunnel with a fairly large shadow on the wall behind him. It uses intertextuality, as it uses parts from a Hitchcock film, which make it like a horror movie, “The Third Man”. The shot is at a low angle, which makes the shadow of the man elongated, creating a better effect for the shot. Also the fact that it is a low key shot, adds to the overall sinister theme of the shot. The next shot is also of a man, but thus time there is a very large shadow that is over the car, and onto the wall.

This shot indicates how safe the car is, as they are away from the outside world, and that nothing in the outside world can hurt them in any way. We don’t find out what the man was doing, or who he was. The low angle shot makes the shadow very big on the wall, which totally overpowers the car. The second to last shot that I have chosen to use is when the car is in the arches, and this like all of the other shots that I have chosen is very dark and menacing. The low key shot causes there to be light above the car, which creates darkness in the arches, and the car becomes shadowy.

The light overall surrounds the car, as though it is moving away from the light and into the dark which creates a creepy atmosphere. The final shot that I have chosen is totally different to the rest of the shots, because it has nothing sinister or dark about it. It is of the new born baby, and this is the point where the viewer realises that the advert wasn’t in fact sinister at all, but they were rushing for the birth of the baby. Nearly the entire screen is filled with the baby screaming, and the colour of it, pink, hits you as the rest of the advert has mainly been dark colours such as black and grey.

This links is with the idea of there being a new generation of cars, as there the baby is a new generation of the family, as in the voice over they say, ” The sound throughout the whole of the advert is mostly no-diegetic, as there is only music and a woman saying a voice over. The music that they have chosen is slow and mysterious, as this links in with the sinister effect that they want to get across. Also the woman figure adds an element of calmness to the creepy music and the actual advert itself, as she have a very motherly and soothing voice.

The 2009 Chrysler-Fiat Strategic Alliance was formed in order to not only revive Chrysler back to the auto company it had been in the past, but also to better Fiat as a whole. The case study begins with a lengthy introduction introducing us to both Chrysler and Fiat from their inception to their current states. Following that is an introduction to the terms of the alliance. After some additional research I have here summarized the terms of what would become the Chrysler-Fiat Strategic Alliance:

• Chrysler and Fiat have announced a non-binding strategic alliance to allow Chrysler access to Fiat vehicle and powertrain technologies for the North American market. Resolution of Daimler’s 19.9 percent share of Chrysler Corporation is a prerequisite for this alliance.

• Fiat would at this point offer no cash for the opportunity for Chrysler to utilize Fiat technologies for future small and compact car products for Chrysler. Fiat receives a 35 percent equity stake of Chrysler Corporation as part of this arrangement. This is described an equity starting point for both companies.

• Fiat would gain access to Chrysler’s North American distribution network while Chrysler could access Fiat’s distribution capabilities in Europe, South America and parts of Asia.

• Chrysler is in dire need of new small/compact platforms to meet stiffening US CAFE regulations as well as an intensely competitive passenger car market focused on global scale economies.

• The fate of scale economies improvement with Chrysler’s larger platforms is still uncertain.

While both companies originate and maintain the majority of their business in very different areas, (from an automotive perspective) they have glaring similarities:

Both companies have a higher focus on the lower-middle class spectrum of the market. Both have a tainted reputation for a weak quality control and reliability with their consumer. Both needed a vast revamping of their companies in order to stay competitive in the market.

Out of these points the last is the most critical. In 2004 Fiat was experiencing equivalent difficulties to that of Chrysler in 2008. Fiat accomplished this company turn around with the assistance of a well known turn around executive: Sergio Marchionne to become CEO. Under his leadership and the reintroduction of the Fiat 500 in 2007 led to a much stronger brand. Chrysler on the other hand did not fair so well on its own. With the bailout money from the US government and the required long term partnership with Fiat Chrysler is well on its way to reemerging back into the auto industry.

This makes Fiat the perfect candidate to buy up Chrysler and fully reorganize their business, seeing as it mirrors Fiat’s reconstruction of only a few years ago. During my research outside of the book I found a excellent article that not only fully laid out the plan, but dissected it into the positives and negatives that would come about from the alliance for both companies I will begin with a summary of the alliance from the perspective of a car magazine that I frequent and then follow up with the positives and negatives:

Fiat will share with Chrysler its platforms and powertrain technology, including engines, transmissions, and fuel-saving tech. The announcement specifically mentions city and compact vehicles, products Chrysler will need should American consumers actually decide to buy the small, fuel-efficient cars U.S. lawmakers claim they want.

Chrysler will also get better distribution of its products, certainly in Europe, but also in places such as India—Fiat has a partnership with Tata Motors—and Brazil. Fiat also has a deal with Chery, the Chinese automaker with which Chrysler had been trying to partner. Both Chrysler and Fiat will also be able to better leverage their global supplier ties and therefore see cost savings in larger volume.

For Fiat, the reward is simple: distribution channels. Currently, Fiat only sells Maserati and Ferrari in the U.S. If Fiat wants to become a truly global entity, a foothold in North America would be most helpful. Alfa Romeo has been promising a proper return to the U.S. market for some time, and Chrysler’s distribution network could ease that brand’s return to our shores.

Fiat will also likely be able to use excess global production capacity to assemble Chrysler-badged variants of its products. With worldwide auto sales slowing, that would help Fiat to continue manufacturing at pre-slowdown levels; Chrysler could potentially build Fiats in its plants, as well.

Chrysler

Positives

Chrysler will have to continue to pare down its portfolio over the next 24-36 months to prepare for new Fiat based offerings in North America. Another positive could be the ability to execute joint purchasing activities, offering some scale opportunities for the supply base. Some Chrysler dealers may distribute Fiat/Alfa Romeo badged products in the future and have access to A and B-segment Fiat products for the North American market. Despite some possible “foreign owner” resistance in Washington, Chrysler can show real progress on the transformation plan requirements due at the end of March 2009.

Negatives

Chrysler still has a cash flow issue. While the possibility to utilize Fiat platforms for Chrysler offerings in the next 12-36 months is appealing, build will have to be located in North America to lower/stabilize production costs – this retooling will require billions in capital in and resource requirements. In 2008, Chrysler built 1.9 million vehicles which were primarily sold in North America. Chrysler still has scale and technology issues in larger offerings – other partners/divestitures are certainly possible as Chrysler reshapes the company. In play are the Minivan Jeep offerings, Ram Pickup and mid-2010 large rear wheel drive offerings. Fiat’s non-North America distribution network offers Chrysler access to new markets, though this benefit is limited in that Chrysler requires better small/compact unibody offerings to be a player outside of North America. A major wildcard is Daimler’s 19.9 percent share of Chrysler Corporation. The Fiat development offers a new dynamic for the eventual owner of this share.

Fiat

Positives

Fiat has several joint ventures/sharing arrangements to assist with scale economies, technology access and geographic deficiencies. Associated companies include BMW, Tata, Ford, PSA and Chery. The sharing affiliation with Chrysler is another extension of their ongoing expansion/risk diversification strategy. The OEM gains access to the lucrative US market – a market slated to rise 18 percent in 2010 from a low point of 11.5 million light vehicle units this year (2009). Distribution of Alfa Romeo and Fiat-branded products in North America is possible – offering greater volume to Fiat going forward. Fiat is able to expand scale economies in core A-, B- and C/D-segments where it is a leader in both platforms and powertrain technologies. Chrysler’s use of Fiat platforms would aid in covering Engineering, Research and Development (ER&D) costs at Fiat. The OEM would now have increased global sourcing possibilities to meet demand. Fiat may have a conduit for South American-built offerings which can be channeled through Mexico and vice versa.

Negatives

Fiat had cash on hand of 3 billion euros as of September 2008. As was the case with all global OEMs, the fourth quarter of 2008 offered financing challenges. It has an aggressive capital plan over the next 36 months which drives the OEM to re-invest in core B-, C- and /D segments – channeling resources to North America is an aggressive move. The European sales market is slated to decline a further 14 percent in 2009 to 18.1 million units and only rise 5 percent in 2010 to 19 million units. Fiat still has several challenges in its home European market, which will offer cash burn challenges. As a sales parent (vehicles built with a Fiat Group brand badge), Fiat built 2.5 million vehicles in 2008. The primary markets were Europe, South America and select parts of Asia. Ownership of the other 55 percent of Chrysler is uncertain. If other OEMs (outside of Daimler, which wants to divest its 19.9 percent share) could become involved and cause complications.

Next I will analyze Fiat and Chrysler in comparison with the other competitors in the auto industry. Because both companies compete in very separate markets I will break them down individually: Chrysler’s competitors in terms of car sales lie in the North American car market. Chrysler’s vehicle fleet competes directly with GM and Ford. Chrysler has always been seen as the weakest of the big three American car manufactures and is looking to change that image with its full reintroduction of its vehicle lineup. Until the year 2014, the Dodge Charger and Chrysler 300 hold a unique position of a large family sedan with a rear wheel drive set up focusing on performance. It is no doubt that this is the reason why these vehicles are the bread and butter of Chrysler’s line up. In addition, Chrysler’s Town and Country is known for going above and beyond its competitors in terms of technology and styling.

Fiat, on the other hand, has its greatest sales in Europe. Specifically Italy where many of its roads require the small cars that Fiat specializes in. Fiat has had little success in reaching customers outside of its home continent before this alliance. With the strategic alliance with Chrysler, Fiat hopes to branch out its global brand image to the United States, which inevitably is a large player in the automotive industry. Compared to other small cars offered in America the Fiat 500 has many visual cues of a sports car that give a greater appeal over that of the general bland look of vehicles such as the Scion iQ.

In terms of global competition the following chart gives another reason as to why Fiat took such a great interest in forming an alliance with Chrysler. Besides Chrysler, Fiat had the lowest number of global vehicle sales in the prior year. If they wanted to remain competitive they would need to increase their global outreach and the auto industry continues to move towards a worldwide scale for all manufacture. [pic]

This alliance sets the stage for the upcoming years for both Chrysler and Fiat. Four years later is it apparent that the plans originally stated have been set in motion. As a car enthusiast I keep up to date with general car knowledge and what is being introduced by each company. So I was interested to see if this alliance had actually provided any real world evidence that production had increased from both companies.

On Chrysler’s side it was noticeable in 2009 that Chrysler’s entire fleet needed to be either refreshed or develop a new model altogether. 2012 was the year, on the consumer side of things, where the majority of their vehicles did receive this change. Many elegant Italian stylings are incorporated into the brash/boxy nature of American cars (as seen in the new Dodge Charger and Chrysler 300). Also, the 2013 Dodge Dart is the first vehicle to ride upon a Fiat platform.

On Fiat’s side it can be seen that various Chrysler dealerships now additionally carry Fiat vehicles. This marks the first time Fiat vehicles are being sold in North America in many years. The highly successful marketing campaign of Fiat combined with the recent consumer shift in America for smaller cars has led the Fiat 500 (the only current Fiat available in America). In addition, as was recently revealed to the car world, Alfa-Romeo will be making a return to America with its new sports car: the 4C, meant to compete with Porcshe’s 911 in terms of performance and luxury.

This image below outlays a general path for the trading of innovation between the two companies in the upcoming years: [pic]

In conclusion, it is clear that the alliance between Fiat and Chrysler was a necessary one to occur. Both companies, for separate reasons, needed this event to take place for them to survive in the industry. As the case study in the book noted:

“Auto analysts believe that in the coming years, only a small number of auto manufacturers will be left at the global level because of consolidations and mergers. Companies maintaining strong brand identities with competitive technologies and quality will be able to compete effectively.

This case study gave me the advantage to supplement my conclusions with real world figures as the article was written four years ago, giving me a time frame full of research that depicts if either company has improved from the alliance.

To me it is clear that direction that both Fiat and Chrysler have taken in terms of the goals they set has been excellent. The only downside that I have seen so far is the slow sales of the newly introduced Dodge Dart, however the segment it lies in is very competitive and this is natural for a newcomer to the market.

The alliance may have its drawbacks, but seem to be good fit for both. Chrysler needed the alliance due to bankruptcy and conditions of bailout and a partner to bring innovation,R&D, low-cost tech and access to EU market; Fiat will have access to North Am market and distribution. Synergies may not all work due to issues of culture and integration, however opportunities exist to reduce costs, and provide low-priced fuel-efficient automobiles.

In the short run, Chrysler will have gain new platform for fuel efficient vehicles. Fiat will gain entry to American market. In the long run, new technologies may result from partnership. Chrysler can increase market share in mid and low size segments.

The operating environment of businesses is presently crowded by lots of dynamism. Firms are faced by a major dilemma of remaining viable by maintaining profitability while at the same time addressing unpleasant performances. For most firms, the previous two or so years have been very tough, courtesy of the global financial meltdown. Many firms are looking for mechanisms or remaining relevant under this strenuous operating environment. Customer service ideally is being touted as the new competitive advantage strategy that firms are investing in. The paper will assess the customer service strategies that BMW has utilized to earn the 22nd place in the Business week Customer service champs list of the year 2009.

a) Efforts to claiming the position

Although luxury car sales went down by 20% in 2008, BMW’s market share increased. The company has come a long way in attaining this position. Strategizing and counter-strategizing is what the firm has invested in especially in issues relating to customer service. In the past periods, the company has tied compensation to dealers on the satisfaction scores from customers. The approach was not as effective as intended as many dealers scored highly each year. A revision of strategy was done. Presently, BMW has linked rewards to dealers on how they handle dissatisfied customers (Edmondson, G et al., 2003). The approach has earned the name ‘paradigm shift’.

The company guarantees customers that services begin in the vehicle. The firm has invested in intelligence where a customer can call service status at any time. According to the company’s corporate site, the data on wear and tear and fluid levels is constantly monitored and can be stored and accessed in the car key thanks to technology (BMW, 2009). The firm makes it a point to utilize relationship marketing concept where customers visit BMW Service Centre on appointment arrangements to service the vehicles. The uniqueness of this arrangement is that customers receive individualized, cost effective and time saving services.

The firm handles customer feedback fast enough than before. For instance, quality problems are resolved in a matter of days and not months as used to be the situation. This has made the firm to train its dealers on how to assist customers master technicalities like iDrive functions (Edmondson et al, 2003). BMW still offers four years or 50,000 miles warranty on some of its products. The firm possibly would not have made it to the Business week customer service champs if its amazing BMW Maintenance Program and the Unlimited-Mileage Roadside Assistance was not in place.

b) BMW Service guarantees/Warranties

The company is widely recognized for offering luxury auto products to clients globally. BMW provides free service for four years to its customers. Training dealers is part of the company’s efforts in streamlining customer services. Buyers of used BMW cars have an option of purchasing an attached Certified Pre-Owned (CPO) BMW warranty making it transferable to new owners should a buyer wish to sell his or her car. CPO is a Certified Pre-Owned Vehicle Program, a service that ensures that used cars whose odometer read between 6000 and 60000 miles are extensively inspected thoroughly by BMW trained technicians for safety, performance and wear (BMW, 2009). Anything faulty is fixed. Competitive firms are dedicated to three main pillars that define their warranty and products; quality, efficiency and innovation (Calloway, 2003).

When customers buy a new BMW car, the firm guarantees pleasure to the customers. In this case, the firm’s Service Centre presently offers a warranty of twelve years  for the bodywork and three years for the paintwork. Moreover, the company is dedicated to offering a warranty of two years for the entire automobile [Excluding worn out parts] on all original BMW parts and accessories, regardless of mileage on the auto (BMW, 2009). The BMW Maintenance Program and the Unlimited-Mileage Roadside Assistance makes the firm outstanding with this service being the best factory warranty that an owner of a new car can get (Edmondson, G et al., 2003).

c) History of the service guarantees/warranties

BMW as a firm is reknown for record spending per vehicle on their customers. The firm values customer service since its inception. For a very long time, BMW has been offering attractive product warranties to its customers. The company has been in operation since around 1900s. Over the years, the firm has made different models of autos and provided warranty to the said models. Warranty has been changing regularly depending on company policy.

Different series of cars have had varying warranty over the years until 1990. In mid 1990, BMW announced the now famous 4 Year/ 50,000 miles warranty on its cars. The warranty still applies up to today. In 2004, the company proposed another warranty over and above the 4 Years/50,000 miles warranty. All cars registered in January 2004 have a 12 years anti-corrosion warranty that offers among other things general body work cover (Edmondson, G et al., 2003). The success of the company and its warranty customer service has made the company command a huge market share in the luxury car market.

d) Understandability and communication of the warranty

The product warranties on BMW products are simple to understand. In addition, the firm too expounds on the technical aspects of the warranties. The company takes upon itself to train dealers on how to clarify warranty questions to customers. BMW has advanced technology on most of its series of automobiles. This makes the monitoring of the vehicle possible. Ideally, the autos are fitted with gadgets that keep a record on everything in the vehicle including wear and tear on the vehicle.

Effective communication is systematic and never a random activity as most people take it. It requires selecting and use of most effective medium, or vehicles that will allow the message to be delivered to the target audience, in this case, BMW customers (Barrett, 2005). BMW has developed an effective communication strategy that guides the firm in all situations. Communication of warranty forms part of the communication strategy of the firm.

The firm recognizes that without a clear and well drawn strategy, customer service goals remain and illusion (Welch, 2006). The firm utilizes dealerships in communicating warranty information. Given that warranty service is a technical item, the company has prepared warranty documents that accompany each series of vehicle that they sell. The documents are written in prose business language with glossary sections to offer meanings for any technical terms (Barrett, 2005).

The firm is dedicated to ensuring that customers understand the position of the warranties that they offer. In the present business operation environment, cons have crowded the market (Barrett, 2005). Unsuspecting customers will get into business deals that they hardly understand the content and terms and conditions of language used in business documents.

It is only after the customer gets into trouble that translations of clauses that seemed harmless get meaning making the customer a loser. Since BMW values it customers, it has made it its duty to explain everything in black and white about the terms and conditions of the warranties. The firm has secured the slot in the Business week 2009 list of customer service champs due to its proactive style in dealing with customer warranty clarifications and service delivery when customers invoke warranty claims.