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Authors: Hellmut Schutte
Published by: INSEAD
Originally published in: 1998
Version: 03.1998

Abstract

This case describes the process of negotiations between a large American MNC, an Asian government and a local, fast growing conglomerate. Market access for trucks is traded against local production of diesel engines, but the requirements change constantly, as do competitive pressure and the relationship with the local partner. Then the Asian crisis hits. The case demonstrates the complexity of dealing with fast changing government policies in developing countries and the volatility of emerging markets. Distributorship agreements, local assembly with high local content, acquisition or greenfield operations are options open to the MNC at times. All of this local scene is played out in the context of global competition in the oligopolistic market of trucks and diesel engines.
Size:
Large multi-national
Other setting(s):
1990-1998

About

Abstract

This case describes the process of negotiations between a large American MNC, an Asian government and a local, fast growing conglomerate. Market access for trucks is traded against local production of diesel engines, but the requirements change constantly, as do competitive pressure and the relationship with the local partner. Then the Asian crisis hits. The case demonstrates the complexity of dealing with fast changing government policies in developing countries and the volatility of emerging markets. Distributorship agreements, local assembly with high local content, acquisition or greenfield operations are options open to the MNC at times. All of this local scene is played out in the context of global competition in the oligopolistic market of trucks and diesel engines.

Settings

Size:
Large multi-national
Other setting(s):
1990-1998

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