Post Merger Period of Fiat and Chrysler
Every coin has two sides. After the merger, both companies encountered several problems during their integration. Next, I will go into details about issues they faced.
First of all, they wanted to further solidify their brand presence. Fiat has been successful in the European market but lacks visibility in North America; while Chrysler does not carry a strong dealer network in the European markets. What’s worse, historically, Chrysler was referred to the “Number Three” auto manufacturer and even today, it still remains as the “Number Three” after GM and Ford. This impression links to poor brand visibility and low customer royalty. In order to change the status quo, Chrysler focused more on brands differentiation. It planned to reposition itself as an upper scale brand. In 2011, Chrysler unveiled their new "Imported From Detroit" campaign. It defined itself as the “import-fighter” and focused on quality, technology, fuel saving and sustainability. As for fiat, they invited celebrities to advertise for them. For example, they invited American singer Jennifer Lopez. This offered them the opportunity of a 360-degree partnership, which triggered the greatest awareness growth ever. Without being shown on television or through the networks, it gained global attention.
The second problem they have is labor issues. The relationship between Fiat and labor union has never been satisfying. It suffered from the large layoffs and rigid Italian labor laws. Also, FIOM (labor union in Italy) instigated strikes in the fear that Fiat might pull out from Italy's employer’s association and Italian auto market. The disputes between Fiat and Italian labor union are still in heat even today. On the other hand, the UAW (United Automobile Workers), who is the part owner of Chrysler, used to provide cheap labor for Chrysler in order to profit from low production cost. However, this happened no more because their friendly relationship broke off as Fiat and UAW were sharply disputing over
First of all, they wanted to further solidify their brand presence. Fiat has been successful in the European market but lacks visibility in North America; while Chrysler does not carry a strong dealer network in the European markets. What’s worse, historically, Chrysler was referred to the “Number Three” auto manufacturer and even today, it still remains as the “Number Three” after GM and Ford. This impression links to poor brand visibility and low customer royalty. In order to change the status quo, Chrysler focused more on brands differentiation. It planned to reposition itself as an upper scale brand. In 2011, Chrysler unveiled their new "Imported From Detroit" campaign. It defined itself as the “import-fighter” and focused on quality, technology, fuel saving and sustainability. As for fiat, they invited celebrities to advertise for them. For example, they invited American singer Jennifer Lopez. This offered them the opportunity of a 360-degree partnership, which triggered the greatest awareness growth ever. Without being shown on television or through the networks, it gained global attention.
The second problem they have is labor issues. The relationship between Fiat and labor union has never been satisfying. It suffered from the large layoffs and rigid Italian labor laws. Also, FIOM (labor union in Italy) instigated strikes in the fear that Fiat might pull out from Italy's employer’s association and Italian auto market. The disputes between Fiat and Italian labor union are still in heat even today. On the other hand, the UAW (United Automobile Workers), who is the part owner of Chrysler, used to provide cheap labor for Chrysler in order to profit from low production cost. However, this happened no more because their friendly relationship broke off as Fiat and UAW were sharply disputing over