Presented To: Prof.

Nasir Riaz

Presented By: Zohaib Bashir

Yasmeen Sadiq
Saadat Ali
Jawad Abdul Khaliq
Chrysler Mission Statement
Chrysler's primary goal is to achieve
consumer satisfaction. We do it through
engineering excellence, innovative products,
high quality and superior service. And we do
it as a team.
Chrysler History
 Chrysler was founded in 1925
 The founder was with the provide advance

technology in cars
 This thinking helped Chrysler and build a 2nd

position in US market. Chrysler hold this

position from 1936 to 1949
 In late 1950’s it was tagged as ME TOO

company
 In late 1970’s as poor cash company
 In 1980 there are just two options whether go

for bankruptcy or loan form Government

Car Models

1931 Plymouth

1936 Chrysler Airflow

1955 Imperial
Critical Issues Faced by Crysler
 Basic problem: failed to provide products
according to the requirements of customer
 Never able to achieve profits more than 3 to 4

percent of sales
 Low fuel efficient cars
 Supplier strikes effects production of

company
 Conflicting interests of top management
 Inventory remain in stock 100 days of sale
Porters Five Forces
HIGH MODERATE LOW

Barriers to entry  .

Bargaining power
 .
of supplier

Bargaining power
 .
of buyer

Rivalry among
 .
existing firms

Threat of
 .
substitutes
Financial analysis
 SWOT Analysis
 Strengths
◦ Use of computer system which cuts $60 Million from
Chrysler’s average inventory
◦ Chrysler covers 90% of domestic market share
◦ Dealer network was expanded and strengthened at cost of
nearly $100 million
◦ Segmented there product to make a regional selling base
on color, style, design and model
◦ Scheduled its production based on its computerized
modeling called “sales bank”
◦ 1965 they hire experts to redesign its product design with
new technological development
 SWOT Analysis
 Weaknesses
◦ Poor relationship with dealers, suppliers and the American
consumer
◦ They management is very weak in decision making
◦ Chrysler has operational problems and high costs.
◦ Are behind in R&D and announced they would be introducing
an electric vehicle in three to five years when most of their
competition will have them sooner.
◦ They do not have a really cheap small fuel efficient car right
now
◦ The overall quality of the product is good but not at industry
average
◦ Tagged as “me too” company
◦ Company was “cash poor” and having huge operational loses
 SWOT Analysis
 Opportunities
◦ Demand of small cars rapidly increasing
◦ Consumers are starting to become interested in
buying alternative fuel sources.
◦ Creating a company brand identity
◦ Innovation should lead to new products on market
◦ New innovation can compete with others
◦ Cut health-care costs
◦ Cut jobs and move production overseas
◦ Shrink brand line
 SWOT Analysis
 Threats
◦ Have to face both Government and market pressure
◦ Market was volatile and complicated by the
increasing penetration by the imports
◦ Size of the market demand a varied marketing plan
◦ Still did not have a corporate brand identity
 SO Strategies ST Strategies
Retrenchment: shrink product line by using Divestiture: those production line who are not
computerized systems (S1, O7) selling in there segments should closed to save
Downsizing: by cutting jobs and extra expenses costs (S4,T1)
in health care with the help new systems
(S6,05,O6)
Product development: manufacturing fuel
efficient cars (S2, S4, O1, O9)

WO Strategies WT Strategies
Divestiture: sell units who are even not Divestiture: sell units who are even not
meeting break even points (W3, W7,O6) meeting break even points (W1,W3,T1)
Downsizing: weak management should Product development: manufacturing
remove to cut cost (W2,O5,O6) fuel efficient cars( W5,T2)
product development: improve R & D,
and move to international market
(W4,O2,O9)
 EFE Matrix
Weighted
Key External Factors Weight Rating
Score
Opportunities
1.   Demand of small cars rapidly increase 0.1 4 0.4
2.   Consumers taste changes 0.06 3 0.18
3.   Creating a company brand identity 0.07 3 0.21
4.   Innovation should needed 0.06 4 0.24
5.   Cut health-care costs 0.08 4 0.32
6.   Cut jobs and move production overseas 0.11 3 0.33
7.   Shrink brand line 0.12 3 0.36
8.   Recapture market share and be more 0.09 2 0.18
competitive
9. Concentrating on smaller more fuel efficient 0.07 2 0.14
cars
Threats
1.Have to face both Government and market 0.04 1 0.04
pressure
2.Market was volatile and complicated by the 0.05 2 0.1
 Competitive Profile Matrix
Sr. No Critical Success Factors Chrysler Ford GM
    Weights Rating Score Rating Score Rating Score
1 Better Cost Control 0.1 2 0.2 2 0.2 2 0.2
2 Market Share 0.13 1 0.13 2 0.26 3 0.39
3 Financial Position 0.12 2 0.24 3 0.36 4 0.48
4 Strong Research and
0.11 2 0.22 3 0.33 3 0.33
Development
5 Effective Supply Chain
0.1 2 0.2 3 0.3 3 0.3
Management
6 Technologically up to the
marks of production 0.12 4 0.48 2 0.24 3 0.36
process
7 Economies of Scale in
whole business 0.12 2 0.24 4 0.48 3 0.36
operations.
8 Better customer relations
0.09 2 0.18 3 0.27 4 0.36
and loyalty
9 Global Expansion 0.11 2 0.22 2 0.22 3 0.33
 IFE Matrix
Key Internal Factors Weight Rating Weighted score
Strengths
1.   Use computerized systems 0.09 3 0.27
2.   Capture 90% domestic market share 0.1 3 0.3
3.   Strengthened dealer network 0.06 2 0.12
4.   Product segmentation on regional
0.07 3 0.21
base
5.   “sales bank” 0.12 2 0.24
6. New technological development 0.07 1 0.07
Weakness
1. Poor relationships with
0.04 2 0.08
stakeholders
2. Weak decision making 0.06 1 0.06
3. Operational problem, high cost 0.1 2 0.2
4. Weak research and development 0.1 1 0.1
5. Don’t have small and fuel efficient
0.1 2 0.2
cars
6. Tagged ME TOO company 0.03 1 0.03
 SPACE MATRIX RATINGS
FINANCIAL STRENGTH Ratings

Working capital 3.0

Cash flows 3.0

Liquidity 3.0

Risk involve in business 4.0

Return on investment 3.0

Total 16

INDUSTRY STRENGTH Ratings

Financial stability 2.0

Capacity utilization 3.0

 SPACE MATRIX RATINGS
ENVIRONMENTAL STABILITY Ratings

Rate of inflation -4.0

Technological changes -4.0

Demand variability -4.0

Competitive pressure -4.0

Barriers to entry into market -3.0

Total -19.0

COMPETITIVE ADVANTAGE Ratings

Product life cycle -3.0

Market share -2.0

CONCLUSION
◦ FS Average is = 16.0 / 5 = 3.2
◦ ES Average is = -19.0 / 5 = -3.8
◦ CA Average is= -16.0 /5 = -3.2
◦ IS Average is = 13.0 / 5 = 2.6
Directional X-axis: 2.6 + (-3.2) = -0.6
Directional Y-axis: 3.2 + (-3.8) = -0.6
BCG Matrix
Internal External Matrix
GSM
 Matrix Analysis

Alternative Strategies SWOT SPACE BCG IE GSM COUNT

Forward Integration
Backward Integration
Horizontal Integration
Market Development
Market Penetration
Product Development X 1
Concentric Diversification X 1
Conglomerate Diversification X 1
Retrenchment X X X X X 5
Divestiture X X X X X 5
Downsizing X 1
Liquidation X X X 3
Strategic Recommendations
 Cut costs immediately. For the reason to reduce its expenses
and at its current position Chrysler has to adopt retrenchment.
 By adopting this strategy Chrysler can be in position to keep
its financial up to breakeven point.
 Cut health-care costs, Cut jobs and move production
overseas, Shrink brand line, sell non productive units etc
 As loan has been sectioned by Government for Chrysler
Corporation and retrenchment also help to cut unnecessary
expenses so it will definitely help Chrysler to overcome its
financial. Chrysler can be reinvent itself.