Managing the Cultural Issue of Merger and Acquisition

Renault-Nissan, Daimler-Chrysler, Ford-Volvo, Daewoo-General Motors...The phenomenon of merger and acquisition within the automotive industry is booming. Just before, it was the take over of Rover by BMW, and the acquisition of Seat, Audi and Skoda by Volkswagen. An unprecedented history. Tokyo, March 27, 1999 Louis Schweitzer, Chairman and Chief Executive Officer of Renault, and Yoshikazu Hanawa, President and Chief Executive Officer of Nissan Motor Co., jointly announced today a global partnership agreement that would create the fourth largest automaker in the world, while achieving profitable growth for both partners. One year before this alliance it was Jürgen Schrempp, chief executive of Daimler-Benz, who started the story by risking with Robert Eaton, CEO of Chrysler, the biggest industrial automobile fusion ever. Following that, it is the American Ford that bought Volvo, while the Swedish carmaker was planning few years ago an alliance with Renault. At the same time the German Volkswagen took the control of Audi, Skoda and Seat However, despite the large amount of M&A among the carmakers, Renault, by merging with a Japanese company, can be considered as a forerunner. The phenomenon of merger is a quite recent one in Japan. Nowadays, the terms ‘acquisition’ and ‘merger’ still have unwelcome connotations in Japanese business and legal circles. Indeed, even if there is no doubt that Japan has undertaken in recent years to improve access to its market by removing all the ‘visible’ trade barriers, its competitors still complain about ‘invisible’ barriers to the Japanese market based on attitudes, cultures, values, and tradition.