Volkswagen and Tata Motors: A Strategic Alliance in India
(6 pages of text)
Case (Pub Mat)
In 2017, Volkswagen Group was not satisfied with its performance in India. Tata Motors Limited, on the other hand, had been dealing with increased competition from new automobile players. In March 2017, both players made the announcement of a potential strategic alliance with one another. However, the alliance talks soon stalled over the potential use of a platform and the practicality of the business model. The question facing both companies was whether to work out their differences and move the alliance forward, or to terminate the negotiation talks and operate independently.
This case is ideal for use in graduate and postgraduate management courses. It can be used in strategic management courses to facilitate understanding of the internationalization strategy of an organization and how alliances can be used to complement an organization’s business strategy. It can also be used to discuss strategic alliances and joint ventures. The case gives students an opportunity to do the following:
- Appreciate how a business environment affects a firm’s international strategy, specifically when deciding whether to operate independently or form an alliance.
- Understand the factors involved when selecting a partner for a strategic alliance.
- Recognize the risks involved in an international strategic alliance.
- Understand the individual and joint values that can be created out of an alliance.
- Understand the negotiation process and conditions for an alliance.
India, Medium, 2017
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