Case Overview:It all started in 1979. Mazda, at the time a relatively small player in the global automotive market, wanted an international partner to achieve the transformation from being a small player niche to becoming a major global automotive manufacturer. At the same time, Ford was also looking for a partner to help it design and produce smaller cars. The two companies agreed to be logical partners. Ford is a major US company and Mazda is based in Japan. Mazda sold 25% of its shares to Ford and a collaboration agreement began. This case describes the success stories of collaboration in the automotive industry between the Japanese company and the US company although they were obviously competitors. A significant success story emerging from the alliance concerns the Ford probe and the Mazda MX-6. There was an exchange of resources and capabilities between the two companies. Mazda designers design the basic platform, engine and transmission for cars. Mazda then designs the exterior of the MX-6 and Ford does the same for the Probe. Finally, both cars are assembled in a factory owned by the two companies. The Ford Escort was another successful fruit of the alliance where once again Mazda engineers designed the car and Ford built it. But the alliance was not without points. Mazda Navaho is one of the children of the alliance which was basically based on the popular Ford Explorer product and built by Ford manufacturers. Ford took the opposite step by denying to supply its Japanese partner Navaho with manufacturing to continue production of its own product line. Partner Mazda also fell into financial difficulties, and Ford gained effective management control of Mazda and took some bold steps that ultimately worked against the collaboration. Case Question Statement: [Question Answers: Question 1: Strategic Alliance: Two or more companies combined together to address competitive situation. It refers to the combination of different companies for their mutual benefits.Different types of alliance:LicenseFranchiseManagement contractTurnkey operationShared ownershipEquity alliance.Strategic alliance is approached by selling 25% share of Mazda to Ford automobile company. So it was a strategic alliance and shared ownership. Shared ownership alliance is actually a special form of joint venture. Question 2: Before the alliance the two companies operated in totally different markets and in different countries, but the industry was of the same type. Both companies were aware of their future plan and were missing.