Fiat’s acquisition of Lancia in 1969 represented an opportunity for Fiat to strengthen its position in the upper end of the European market. However, Lancia lost its brand identity as a high quality car manufacture, while the Fiat Group remained focused upon the lower end of the market. The paper addresses why path-changing opportunities towards more flexible output-mix strategies that emerged at Fiat before and after acquiring Lancia did not unfold. It identifies and analyses the meta-routines for new design selection as the dynamic link between initial conditions of path dependence (development of design hierarchies at Fiat) and lock-in (an output mix skewed towards utilitarian cars).

Dr Giuliano Maielli (PhD London School of Economics) is Senior Lecturer in Operations Management. His main research interests revolve around the relationship between the accumulation of intangible assets and strategic decision-making. In particular, he is interested in both theoretical and empirical applications of path dependency and evolutionary theories of economic change to the analysis of technological and organisational developments in large and medium firms, with a specific focus on the car industry and flexible manufacturing systems.