Question

Briefly describe the following partnerships in the auto industry . Be sure to briefly describe the venture before analysis. [Minimum 100 words each]

a. NUMMI

b. BBA [HInt: this is a sino-german JV)

c. Diamler Via

d. Toyota Mazda [Hint: in Alabama]

Answer 1

New United Motor Manufacturing, Inc. (NUMMI) was an automobile company in Fremont, California, which was jointly owned by General Motors and Toyota that opened in 1984 and was closed down in 2010. GM declined the venture in June 2009 because the company was bankrupted. Then Toyota also declined in March 2010 and finally, in April, the plant was shut down. NUMMI ceased operations and the equipment were sold at the auction and Tesla Motors purchased partially the equipment. The last car which was a red Toyota Corolla was shifted to a museum. Although the closure was opposed by the officials, the strikes did not work. The reasons for the decline along with the bankruptcy are cultural arrogance and lack of focus even though some flexible work rules were implemented.

BBA or BMW Brilliance Automotive Ltd established in May 2003 is a joint venture between the BMW Group and Brilliance China Automotive Holdings Ltd. It is known for state-of-the-art production. It is a highly successful business model which is the top taxpayer. It is first premium Joint Venture to assemble high voltage batteries in China. The sustainability strategy has maximized performance and minimized waste and consumption, and it could record for the lowest average fuel consumption. The customer service is the top-most priority of BBA. It is involved in CSR activities which also created the brand image. It donated for protection of intangible cultural heritage projects. Its advanced technology and production of quality products have led to the BBA success.

Diamler Via is the joint venture that took place in 2015. Via, the world's leading on-demand shared rides technology developer has empowered a vibrant mass transit system thereby reducing traffic volume in urban areas. Via’s intelligent shared rides services aligns the passengers headed in the same direction thereby matching the rides and sharing the cars and reducing traffic congestion. The competitive advantage of Via is its sophisticated algorithm that promptly finds a vehicle that best matches with the passenger’s route enabling cars to be routed through thousands of virtual bus stops. The Daimler group exceptional design and engineering has proved to be efficient vans and the deadly strategic partnership has proved to be a company with operational excellence and efficient and sustainable carpooling services.

Toyota Mazda, the two Japanese companies have established on March 1st, 2018, a joint venture to build a new plant in Alabama. The plant is likely to open in 2021 and provide employment to 4000 employees in the opening. It can build up to 300,000 vehicles annually and for Toyota, it is the 11th manufacturing plant in the USA. They aim to produce premium quality cars with the best customer service. Toyota and Mazda are investing $1.6 billion on equal funding contribution. It promises to establish a company with the best of corporate culture and technology. Mazda is a 100-year-old company and Toyota is 60 years old company, both are engineered pioneered car manufacturers. So, the company has a lot of expectation for sustainable growth and high profit margins.