Question

An aircraft manufacturer with a strong presence in the United States, is looking to expand its market overseas. The firm currently sells its aircraft to several airlines in the United Kingdom but now wants to establish manufacturing units there as well in order to acquire a bigger share in the European market. Hence, it plans to merge with QueenAir, a British aircraft manufacturer. Which of the following, if true, would weaken the company's decision to merge with QueenAir?
a. Merging with QueenAir would increase its profits considerably.
b. There is increasing economic uncertainty in its U.S. market.
c. The preferences of airline customers in Europe and the U.S. are similar.
d. There is a striking difference in the organizational cultures of the two firms.
e. A competitor in the U.S. market recently went out of business.

Answer 1

Answer:

d. There is a striking difference in the organizational cultures of the two firms.

Explanation:

Numeral d would likely be the argument that would weaken the company's decision to merge with QueenAir.

The reason is that, if the two companies have strikingly different organizational cultures (for example, the American company could have a more traditional, vertical hierarchy, while the British company could be more horizontal and less hierarchical), coordinating them both once the merge is completed could be so difficult as to make the whole process not worth it.