Ever since Daimler-Benz and Chrysler Corp. announced their engagement last year, the matchmakers have been at work pairing off other likely couples.
Mergers and acquisitions are nothing new in the auto industry - just look back in time and see where some of the great old names have gone. They were engulfed by the big players such as General Motors and Volkswagen AG years ago.
'Merger mania' has been the catch-phrase of the 1990s in the components sector, and while BMW's move for Rover in 1994 caused a stir, nothing seems to have captured the imagination like DaimlerChrysler. This is mainly a result of the sheer scale and high profile of the couple that created one of the world's largest transportation companies and the fifth-largest automaker.
Ford and Volvo look as if they'll be next, unless someone else makes a move for the Swedish business. And then who's next?
The industry has convinced itself that the shake-out in both the vehicle manufacturer and component supply communities is going to come down to maybe just six of each worldwide, and so now they jockey for position. Amid the scramble, each has to be very careful about whom it chooses as a partner. If the synergies are not right, the perfect marriage could turn out to be an unholy alliance.
A lot of damage can also occur along the way. Even if a company is not interested in joining forces, there may be those who think it should be, a phenomenon increasingly evident in the marketplace.
Spoiling tactics by competitors aimed at redirecting the forces of competition to their own advantage - a sort of industrial sabotage, if you like - can take the form of merger or takeover rumors.
BMW's Ernst Baumann, elsewhere in this issue of Automotive International, said it is now necessary to be prepared for spoiling operations by competitors and to develop the ability to take rapid countermeasures. It is therefore essential for organizations to improve their ability both to act and react and to adapt quickly. The trouble is that one then has one's best people stamping out fires when they should be guiding the business forward.
And just what happens when the industry is finally reduced to those half dozen manufacturers and suppliers? Just how big and unwieldy will they be? Many businesses, such as BMW or Porsche, made their names by being smart, inno-vative and small - seeking out niches in the market where the sales volumes may be low but the margins high.
It's the same for suppliers. There are plenty of small Tier 2, 3 and 4 businesses that are going to discover they are much more agile and flexible than the new global giants, and they will be able to carve out some good high-profit business.
The auto industry has always had a lemming mentality - where one leads, others will follow, quite often in blind faith. Clear, concise, forward thinking is not always possible in the jumble of bureaucratic corporate policy. There is often a big advantage in being fast and maneuverable.