Bombardier Transportation And Adtranz Acquisition Summary

Case Study: Bombardier Transportation and Adtranz Acquisition

Sanjani R. Prodduturu

[BA 388T] Strategic Management

Table of Contents

Executive Summary 3

Case Study: Bombardier Transportation and Adtranz Acquisition 4

Bombardier Transportation Division 4

Bombardier Transportation Acquisition 6

Bombardier Transportation, Adtranz acquisition. 7

Future of Bombardier Transportation with Lortie 8

Exhibit 10

References 13

Executive Summary

Initially a small Canadian business, Bombardier made snowmobiles for easier movement across snow covered roads. During WWII, Bombardier received multiple orders which helped refine its production process. Bombardier’s CEO quickly learned that for the company to succeed long term, it needs to develop its portfolio.

was started by a mechanic that saw an opportunity to help his fellow villagers from spending long winter months alone without any outside contact due to the lack of proper transportation to travel the snow-covered roads. After about a decade’s work, Joseph-Armand Bombardier invented the snowmobile. Over the next couple of decades, the company received many orders including orders from the Canadian government during Second World War. Through continuous improvements and constant refinements to his production process, Bombardier created the one passenger snowmobile, Ski-Doo which became very popular. Soon the company went public and entered international markets causing rapid growth in business resulting in various acquisitions leading to an initially involuntary diversification of Bombardier. However, after the energy crisis, Bombardier’s President quickly realized that diversification was imperative to Bombardier’s long-term survival. The object of this case study is to analyze Bombardier’s expansion into the Transportation Division, evaluate the company’s decisions on expansions which ultimately led to its acquisition of Adtranz, understand the attractiveness of Adtranz and finally recommend the best decision for operating the new acquisition to the COO, Pierre

The rail industry has initially large sunk costs due to the building and storage of the rail cars. Currently, Bombardier outsources its core function and focuses primarily on assembling the rail cars as opposed to manufacturing in house. By optimizing its delivery methods and throughput time while assembling the rail cars in house, Bombardier was able to control important aspects of its products such as the technology and design differentiating it from its competitors and ensuring the company remains a leader in technological advances. While Bombardier already has a great reputation in the rail car industry for its structure systems for assembling and delivering, they would need to rebuild that reputation in building their own materials which could lead to extra