M Business 5th Edition by Ferrell,Geoffrey Hirt,Linda Ferrell

Exercise 2

Sergio Marchionne, CEO of Fiat Chrysler Automobiles (FCA), has developed a five year plan for the merged company. In 2014Italian carmaker Fiat spent $4.35 billion to buy out Chrysler's minority shareholder and assume full ownership of the company. This merger makes FCA the seventh largest automaker in the world. If Marchionne has his way, FCA will successfully compete against global giants such as General Motors and Toyota. FCA has adopted the five-year strategic plan to increase the company's global presence. The plan calls for FCA to increase its world sales of automobiles from 4.4 to7 million by 2018. Within the next five years FCA wants to quadruple sales of Maser at is, sell 150,000 Alfa Romeo automobiles in the United States, and increase American vehicle sales from 1 to 3.1 million. This large-scale strategic plan involves a number of other actions as well. For instance, the company plans to find a new design and production site for the Chrysler minivan, collaborate with a Chinese partner to begin building Jeeps in Asia, and create a marketing strategy to increase sales of the Alfa Romeo automobile in the United States. Marchionne also plans to integrate the Ferrari brand with the Fiat brand more closely. FCA has already taken a number of steps toward achievement of its goals. For instance, it launched its Alfa 4C Roadster in the United States over the summer and discontinued the midsized Avenger Sedan. While these plans seem ambitious, Marchionne has proven that he is more than capable of handling the challenge. To ensure the company will set out on the right path, he plans to continue leading FCA for another three years. 16
Describe some ways in which FCA plans to use strategic plans.