Nasser also states that in the coming years the automotive market will demand greater building flexibility between models to build off the same foundation. One example of this is the case of Audi and Volkswagen, where one frame platform serves seven automobiles. Cost efficiency is not the only goal of auto manufactures in today's merging feats. Another main reason is to gain entry into a certain market segment. Starting up a new product line has tremendous costs associated with it. Also, it is difficult to convince buyers that it can produce quality cars in another particular market segment. By merging with another company, a company can build upon it's know reputation.Ford says Lincoln stands for "American luxury"; Volvo means "thoughtful" and "understated", Jaguar suggests "refined power", and Aston Martin is a "most exclusive club" (Holstein). Ford is looking to these names to catapult them to the rank of the world's dominant maker of luxury vehicles. In 1998 Ford sold 250,000 luxury vehicles worldwide and Volvo sold about 400,000. If Jaguar continues to expand and the numbers from Ford and Volvo are combined, Ford should be able to sell about 1 million luxury cars per year soon after 2000 (Holstein).With all the merging and production it is very important for an automotive maker to avoid the mistake made by General Motors when it lost the definite identities between Chevy, Buick, and Oldsmobile. To Ford's credit, it has maintained Jaguars original identity and kept the great reputation that follows it. Jim Mateyka, vice president of the auto practice at A. T. Kearney says, "It's next to impossible to suddenly convince people after 100 years that Ford is a luxury car" (Holstein). All Ford had to do was purchase the name Jaguar and make the company better while at the same time gaining an instant reputation for luxury.Issue II: SafetyThe auto industry started out designed to fit the need for transportation only. Safety w...
