Doing Business in Europe, Asia and the Americas Question 2,3,and 4 ( business) - Essay Example

Download file to see previous pages... Your answer should address possible reasons why Magna and Sberbank identified each other as suitable partners, why a consortium was chosen as the vehicle of co-operation and what external events gave rise to the opportunity of investing in General Motors European Operations.
Firstly this paper will identify what events lead to the opportunity for companies to invest in GM’s European operations using a PESTL analysis as well as Porters Five forces. Secondly this essay will provide an example as to why it is that a consortium might be the best possible solution to acquire a stake in GM’s European Operations. Lastly, this essay will provide an answer as to why Magna and Sberbank chose to form a consortium with each other.
Political: In the domestic market it is the case that in the public’s eye there was a very negative reception to “Bailing-out” the American automobile manufactures owing to the transition to a new government as well as a general feeling in the American public that it was larger corporations that brought about the economic crisis. As a result, the company sold off a number of its brands including its newly established and highly cherished ‘Hummer’ brand (Smith, 2009). As anybody familiar with the Senate hearing on bailing out the automobile industry, all of the company heads were negatively portrayed in the media for flying-in on private jets.
Economic: In regards to economic factors it is the case that according to Hughes et al. (2009) the company recognized poor sales across all of its brands in the international markets owing to increased competition and a portfolio that were dependant on outdated, heavier models that required far ore fuel than many competitors. In the wake of higher oil prices this negatively affected the firm, and as a result, Japan’s Toyota Motor Corp. overtook General ...Download file to see next pagesRead More