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    Mayur Suresh Iwanate
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    Nissan and Renault chose a strategic alliance over a merger or acquisition for several reasons. Alliances allow companies to enter new markets with restrictions on foreign investment more easily. Both companies also wanted to gain financial and technological synergies through the alliance, which would be difficult through a merger. Renault was motivated by a desire to enter the Japanese market, while Nissan needed cash to pay off debts. However, differences in power and strategic goals between the partners later caused problems, as each company focused more on their own interests than mutual benefit. Conflicting decisions also arose due to divergent long-term goals.

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    Nissan and Renault chose a strategic alliance over a merger or acquisition for several reasons. Alliances allow companies to enter new markets with restrictions on foreign investment more easily. Both companies also wanted to gain financial and technological synergies through the alliance, which would be difficult through a merger. Renault was motivated by a desire to enter the Japanese market, while Nissan needed cash to pay off debts. However, differences in power and strategic goals between the partners later caused problems, as each company focused more on their own interests than mutual benefit. Conflicting decisions also arose due to divergent long-term goals.

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    11 views1 page

    Nissan

    Uploaded by

    Mayur Suresh Iwanate
    Nissan and Renault chose a strategic alliance over a merger or acquisition for several reasons. Alliances allow companies to enter new markets with restrictions on foreign investment more easily. Both companies also wanted to gain financial and technological synergies through the alliance, which would be difficult through a merger. Renault was motivated by a desire to enter the Japanese market, while Nissan needed cash to pay off debts. However, differences in power and strategic goals between the partners later caused problems, as each company focused more on their own interests than mutual benefit. Conflicting decisions also arose due to divergent long-term goals.

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    9/22/22, 5:43 PM Loading..

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    Answer

    Nissan And Renault doesnot choose merger and acquisition because -

    ALLIANCES would facilitate more than mergers the entrace for companies to new geographical phases
    where there are some restrictions on foreign investment .
    As both firms want to add further synergy in their financial , technological aims in that case merger ,
    acquisition doesnt work well.
    The strategic goals of both the partners were different from the beginning . As Renault want to enter into
    japanese market and nissan want to do well in its financial position

    Motivation for RENAULT for strategic alliance

    As Renault want to enter into japanese market as there were lot of restrictions in japan . so the only way to enter
    in Japan was STRATEGIC ALLIANCE .

    Moreover Renault with this strategic alliance want to gain further synergy in technology as Nissan was expert in
    engineering works .

    Motivation for NISSAN for strategic alliance

    Nissan wants to ente in alliance  because Nissan was in huge debt and they needed cash to reduce their burden of
    debt .

    Other motivation was synergy they will ge getting after alliance

    PROBLEMS WITH STRATEGIC ALLIANCE BECAUSE OF POWER DIFFERENCES

    Extracting values for themselves rather than creating mutual value - In Renault - Nissan strategic
    alliance all the partners were focusing on their value creation rather than on mutual value craetion
    Renault's refusal to equalize power relationships within the alliance- Not being able to get equal
    powers create trust issues among the partners .Any unilateral attempt to alter the core philosophy of the
    alliance can be seen and exploited as a token of disrespect and create a trust breakdown. Ironically,the
    same abhorrence of dishonor that initiallycemented Nissan’s compact with Renault nowthreatens to poison
    relations between the pair

    PROBLEMS WITH STRATEGIC ALLIANCE BECAUSE OF GOALS OF PARTNERS

    long term harmony in danger - In Renault-Nissan’s case, the strategic goals of the two partners were
    divergent from the start. Nissan required emergency surgery, which it received with Carlos Ghosn’s
    Nissan Revival Plan, while Renault wanted access to the Asian growth markets whereNissan was already
    well entrenched. These goals do not add up to a recipe for long-term harmony.
    Conflicting decisions - As goals of partners are different it is very difficult to reach at consensus while
    taking a decision

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