INTERNATIONAL JOINT VENTURES Assignment Example | Topics and Well Written Essays - 4000 words

INTERNATIONAL JOINT VENTURES - Assignment Example In essence, Shanghai General Motors was established in mid 1997 with the initiative of a joint venture with another world leading automotive industry known as General Motors (Anderson 2012). The business relationship was meant to be an equal contribution. This relationship was later sealed with the first automotive assemble in 1999 and the first vehicle been Buick Regal. Four years later, the company was rated as the second largest single market that had hit the market with General Motor products. In this regard, Shanghai General Motors is involved with the assembling of components of vehicles that emanate from parts imported from different corners of the globe particularly from US, Korea, Brazil among other countries that are capable of producing automotive parts across the globe. At times, the company makes orders on these parts in advance because some require lengthy shipping to comply with the orders given by customer in various parts of the world (Klein and Abels 2008). From the re onwards, this joint venture has immensely improved to become China’s largest automotive manufacturing company. ... According to Luo and Yan 2001, it is worth noting that China is among the leading countries that have advanced technologically and thus the automotive industry is not un exception. Of importance to note is that automotive industry is one of the world’s crucial technological areas as it involves variety of vehicles which are targeted by millions of people globally. Never the less, information gathering from this multi billion company has not been easy because some of their facts keep on fluctuating depending on the behavior of the market and their potential competitors such as Chery and MD Rover. Actually, they believe in coming up with unique brands, which they place into the market without having to advertise first to bar their competitors from coming up with similar brands that might threaten their ever growing market of automotives. In addition, it becomes cumbersome for individuals to easily access their numerous distinct plants where most of the assembling is done in rega rd to their policy. Type of joint venture It is apparent that Shanghai General Motors Company has been one of the biggest car manufacturing companies in china. The company was formed after a successful collaboration between General Motors and SAIC. With continued lack of advanced technology imported to china by other companies, SAIC decided to approach GM with intent of importing top technology to china on the basis that SAIC would help GM to jointly work in china. In this regard, SAIC and GM privately held a joint venture in 1997 and Shanghai GM (SGM) was born. The investment was valued at $ 1.69 billion. In light of this, it is apparent that the privately held joint venture between the two companies improved their performance (Baran, et al 1996). With GM, china was not only a