Explore the auto parts industry’s current focus of expanding its production capabilities and technologies through vertical integration.
The assignment is to research and analyze this strategy considering:
- When should a producer partner with another company to obtain new or improved capabilities rather than develop these capabilities on its own?
- Why are Tier-1 auto parts suppliers considering mergers and acquisitions and what are the benefits and risks of this action?
- When merging with or acquiring another business, in your opinion, what are the critical areas of leadership that must be employed to ensure the ongoing success of the transaction and why?
Take a look at Auto Parts Industry Looks for New Deals.pdf
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When should a producer partner with another company to obtain new or improved capabilities rather than develop these capabilities on its own?
Producers decide to partner with another company in the cases when one has assets that would improve on another’s capabilities. The cases in which a strategic partnership is a viable and good option for a producer are when the partner company can provide higher efficiency, quality and/or technological capabilities in the areas of manufacturing, engineering or product development. Producers strive towards exploring the potential of partnership and teamwork in order to overcome the limitations of recourses and competencies in order to increase flexibility and leverage their own capabilities, while sharing the costs and risks that arise....
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