Two years after signing a license agreement in the UK, the company now faces an opportunity to establish with another firm a joint venture in France for the European market.
However, the prospect upsets the UK licensee who is clearly doing very well, and who even wants Cameron to consider joint venturing with him in Australia.
Alex took the control in 2001 in order to implement a process of modernization of the company.
His “operation survival” consists Of cutting the production costs by being more soused on the workforce (mainly lay-offs).
The company’s market position in North America began to improve, and so they began to think about foreign markets.
As the problem remained the lack of productive capacity, a bargain with Mc Taggart Supplies Ltd started, and Cameron Auto Parts give them the license of the production if flexible couplings due to the impact that they might have products in the U. The problem with Cameron Auto Parts was that they willing to deliver their products themselves, make a direct deal with the customer and make strong the brand by their their own, but since that did not have the productivity capacity, it was necessary to license .
Case Problem: In this case we can identify several problems, like in the beginning, that there was no diversification of the product or there was no major sales contracts that with the “Big Three”.
Due to the crisis experienced at the beginning of the century, they were forced to improve their production, modernize and diversify it.
Cameron Auto Parts was founded in 1965, as consumer’s they haver three biggest car manufacturers.
Cameron Auto Parts began having crisis in 2000 due two major problems: the first is about the drop in sales that were stopped at $ 48 million and in 2001 dropped to $ 18 million, and the second one is because the entry of Japanese competition to the market.