Autolatina was a t venture formed between Ford and Volkswagen in the Brazilian and Argentine markets between 1987 and 1996.
In 1987 Volkswagen and Ford announced an agreement that would form a theoretically unbeatable giant in the market, the Autolatina. Integrating the factories and operations of the two companies, the idea was to share the costs and enhance the strengths of each one, in an experiment tried also in Portugal with AutoEuropa. The campaign of the new t venture was launched on July 1 of that year, beginning with the internal communication of the two companies, as well as a plaque in headquarters buildings, newspapers, radio and television.
Although the entire process was completed in 1987, only in 1990 did the manufacturers start operating the company, which had 51% of its shares controlled by Volkswagen and 49% by Ford.
The companies focused on communicating the following points:
Autolatina would be a holding company; Volkswagen and Ford would retain the identity and individuality of their brands; Volkswagen dealers would continue to sell and watch Volkswagen products, just like those of Ford in relation to their products; It was not a merger or merger of the two companies, but an operational agreement with benefits for both the public and the public.
Market in 1980
The merger strategy was related to the moment the Brazilian automobile industry was in the second half of the 1980s, with a retraction of the domestic market and timid participation of Brazilian manufacturers in the international market. The strategy also sought to ensure the two manufacturers remained in the domestic market by increasing their rates of profit - both Ford and Volkswagen came from a crisis of sales and market space in the early 1980s.
In the case of Ford, it seemed to be the way out of the country. Prior to the merger, Volkswagen controlled 34% of the Brazilian domestic market, while Ford held a 21% share. After the merger, they began to control together, 60% of the Brazilian market and 30% of the Argentine.
In theory, the merger seemed an ideal outlet for the two manufacturers in an increasingly globalized world. However, the actual establishment of Autolatina faced serious internal and external difficulties in its seven years of existence. The first and major problem to be faced was the lack of investment by the parent companies. Given the competition between Ford and Volkswagen, worldwide, there was the difficulty of exchanging technical knowledge, weakening local collaborations. Another problem was the constant tension between Autolatina and the successive Brazilian governments with which, for different reasons, it disagreed, sometimes because of the freezing of prices, or because of the overvaluation of the currency.
Another problem was with the dealers, because as there was no interrelationship process / product / market, the sales were made separately by the manufacturers who, despite the merger, continued to compete for the launch of new cars in the market, each with its brand of source. Concerning the altercations with the union, both the Ford plants and those of Volkswagen suffered paralysis in the period.
Technology Trades
during the period of activity autolatina, the vw offered to Ford engines Pa-1600, Pa-1800 and Pa-2000 and the platform sedan Santana, which originated models versalles and Royale with identity Ford. Ford, in contrast, offered to vw engines ae-1000 (CHT) and ae 1600 (CHT), in addition to the platform escort, which originated models Apollo, logus and pointer with identity Volkswagen
Hibrid Models
With Autolatina, the two companies began to have t operations at various levels, including shared products: Volkswagen produced the Ford Versailles and Ford Versailles Royale (derived from the Volkswagen Santana and Volkswagen Santana Quantum) and Ford produced the Volkswagen Logus and Volkswagen Pointer (Derived from the Ford Escort). Other cars also marked the season as the Ford Verona and Volkswagen Apollo, this the biggest failure of the partnership. As a curiosity, the Apollo was the Volkswagen car produced for less time in the entire history of the brand - were less than two years.
in the early 90s, the creation of the autolatina began to be questioned internally. staff Volkswagen, for example, she was disturbed with loss of market to one Mille (which, as single vehicle from category, was a growing sales success). the company wanted to enter this segment "popular," but Ford had a different approach, which is evidence for its late entry in this market with the model Ford ka. similarly, engineers Volkswagen realize that it was arrival time to reshape the Volkswagen goal, but the staff of the Ford not agree with the investment necessary because had other priorities in line escort. in addition, there were among the staff of the Volkswagen the perception that their products earned market while the Ford lost. the time, However, showed that both brands were losing ground for competition, including due to the opening of the market and the entrance of new in the industry.
The End
The decision to dissolve Autolatina and separate the two companies was taken at the end of 1994 and took place in 1996, when information systems became specific to each of them. The separation was more friendly than it may seem at first glance: it was a matter of business philosophy and strategy, with few traces of feelings and rancor. One clear sign of this was that the employees were able to choose their destination, that is, whether they would go to Ford or Volkswagen, regardless of their origin. In this way, several former Ford employees stayed in Volkswagen and vice versa.
Among the problems to be solved were the products that used components of the two companies (for example: the Escort with Volkswagen engine) and those in which one of the factories produced for the other (example: the Volkswagen Logus produced by Ford with Volkswagen engine). In order to address this dilemma, the agreement provided that for one year hybrid products would be mutually ive. After this period, each company should be able to work with its own resources.
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