GE's joint venture case
General Electric (GE) formerly entered a foreign market by either acquiring an established firm or establishing a greenfield subsidiary (which is a wholly owned from ground up turnkey project). Joint ventures with a local company were almost never considered. The prevailing philosophy was that without full control, the company didn’t do the deal. However, times have changed. Since the early 2000s joint ventures have become one of the most powerful strategic tools in GE’s arsenal. To enter the South Korean market, for example, GE Money, the retail lending arm of GE’s financial services business, formed joint ventures with Hyundai to offer auto loans, mortgages, and credit cards. GE has a 43 percent stake …show more content…
Source: Charles W.L. Hill (2011). “Global Business Today”, pp.440-441 (ISBN: 978-007-813721-1)
1. GE used to prefer acquisitions or greenfield ventures as an entry mode, rather than joint ventures. Why do you think this was the case?
GE used to prefer acquistions as an entry mode because GE could have complete control of all managerial decisions and gain all the revenue and move right into working into that particular foreign market. GE used to prefer greenfield ventures for the same