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| Marsden Classic MB Date registered: Apr 2006 Location: Capital City USA Vehicle(s): Mercedes-Benz  | Daimler-Benz again? Just might happen. Neon must love this... Chrysler is about to be gutted by some New York Finance types http://www.nytimes.com/2007/05/13/business/13cnd-chrysler.html And things could be looking up for Mercedes-Benz..
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| #74248 |
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| cmitch Expert Date registered: Apr 2006 Location: Ala-Tenn Vehicle(s): 2002 ML320, 2005 S430 4Matic, 2010 F150 Super Crew Posts: 3412  | RE: Daimler-Benz again? I had understood that Daimler-Benz would retain the Jeep division. Is that still the plan? I didn't see that in the article. | ||
| #74251 - in reply to #74248 |
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| iNeon Date registered: Dec 1899 Location: Vehicle(s): | RE: Daimler-Benz again? I don't care anymore. It never meant anything to anyone that I'd trek from one division for specialty coolant to the other for touch-up paint, then back to the first one for a transmission filter kit, etc etc. In the end, I'll still have the same cars, so it doesn't matter if they're DCX cars, Chrysler cars or Daimler-Benz cars. | ||
| #74257 - in reply to #74248 |
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| Marsden Classic MB Date registered: Apr 2006 Location: Capital City USA Vehicle(s): Mercedes-Benz | RE: Daimler-Benz again? Well, I never particularly liked Chrysler products
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| #74261 - in reply to #74248 |
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| DUTCH Administrator Doppelgänger Date registered: Apr 2006 Location: US, GA, Atlanta Vehicle(s): 2015 Audi Q7 3.0 TDI,2018 Sprinter Posts: 9963 | Another Article on the Same Subject Daimler Nears Accord to Sell Most of Chrysler Deal Would Rid Parent Of Billions in Liabilities, Shift Control to Cerberus By GINA CHON, JASON SINGER, DENNIS K. BERMAN and JEFFREY MCCRACKEN May 14, 2007 DaimlerChrysler AG is expected to announce as early as today a deal to sell a controlling stake in Chrysler Group, Detroit's No. 3 auto maker, to private-equity firm Cerberus Capital Management LP, according to people familiar with the matter. The proposed deal would allow the German auto giant to shed Chrysler's $18 billion in retirement and health-care liabilities and could open the door to further restructuring of the nation's unionized auto makers. A private-equity takeover of Chrysler would mark a watershed for the industry, which is struggling under the weight of massive pension and health-care obligations to its unionized workers. Those debts and the cash required to fund them have hobbled General Motors Corp., Ford Motor Co. and Chrysler in the face of relentless competition from Asian and European rivals. Industry analysts estimate that the overseas and U.S. operations of Japanese auto makers like Toyota Motor Corp. have a labor-cost advantage over Chrysler of as much $30 an hour. Cerberus has a record of slashing costs at operations it acquires, and some analysts say a Cerberus-owned Chrysler could move much more aggressively to cut labor costs, prune Chrysler's overpopulated network of U.S. dealers and shift investment to developing markets overseas. But any final deal for Chrysler also hinges on what happens this summer, when the United Auto Workers kicks off negotiations for new master contracts with all three Detroit auto giants. The proposed deal calls for forming a new company to assume Chrysler's pension and health-care liabilities, in which Daimler would hold a minority stake. In addition, Cerberus would make a substantial payment to DaimlerChrysler, according to people familiar with the matter. The size of the payment couldn't be learned, but it is likely to fall far short of the $36 billion the former Daimler-Benz AG paid for Chrysler Corp. in 1998. Negotiations were at an advanced but fluid stage last night, with terms subject to change until a pact is signed. Yesterday, conference rooms at Manhattan-based law firm Shearman & Sterling, which is representing Daimler, were abuzz with executives, lawyers, and bankers filing between meetings, said a person familiar with the matter. Under the proposed deal, Chrysler Chief Executive Tom LaSorda would continue to run the company, people familiar with the talks said. Cerberus adviser Wolfgang Bernhard, a former Chrysler chief operating officer, wouldn't have an executive role at the auto maker, but could have a board seat under the proposed deal, they said. The plan amounts to a massive bet by Cerberus that Chrysler can be turned around. Private-equity buyers typically acquire public companies or parts of them and take them private, seeking to refurbish them outside the public spotlight, in hopes of selling them later at a profit. In many private-equity deals, the buyer borrows against the company's assets or makes other financing deals to help ensure an acquisition pays off. However, Chrysler's massive pension and health-care liabilities mean Cerberus is planning to inject some of its own capital to keep the company running while it restructures operations. A sale to Cerberus could face opposition from Chrysler's unions, which have said they oppose a private-equity takeover of the company. The UAW, in particular, has a contentious relationship with Cerberus. The union recently refused the firm's request for wage cuts in connection with a deal to buy auto-parts supplier Delphi Corp. As a result, Cerberus, which was leading a group of investors seeking to acquire Delphi out of bankruptcy protection, is likely to pull out of the deal. Last month, the UAW, which represents about 50,000 of Chrysler's 80,000 employees, refused Cerberus's demands for wage cuts at Delphi, making it likely that the firm will pull out of a deal to buy the auto-parts supplier, which is operating under bankruptcy-court protection. Other parties bidding for Chrysler are Canadian auto-parts maker Magna International Inc. and a team made up of the Blackstone Group and Centerbridge Capital Partners. The groups recently submitted a second round of bids to DaimlerChrysler. Billionaire Kirk Kerkorian, who publicly offered $4.5 billion for Chrysler, was frozen out of the talks. The proposed sale to Cerberus, if it goes through, would mark the end of DaimlerChrysler's turbulent nine-year effort to make a success of an ambitious global expansion strategy pushed by former Chairman and Chief Executive Officer Jürgen Schrempp. Mr. Schrempp rocked the auto industry in 1998 with his deal to buy Chrysler, which at the time was at a high point in its profit and product cycle. Billed at the time as a "merger of equals," the marriage of Daimler's Mercedes-Benz luxury-car operations and Chrysler's portfolio of pickups, sport-utility vehicles, large sedans and minivans never delivered the synergies that Mr. Schrempp and his successor, Dieter Zetsche, argued it could. Instead, Chrysler's performance see-sawed from losses to profits to, most recently, losses again. For 2006, Chrysler Group had a loss of $633.3 million on revenue of $63.6 billion. Mr. Zetsche, who led a Chrysler turnaround effort from 2000 until shortly before he became the parent company's CEO in 2006, at first resisted calls to sell Chrysler after the U.S. unit stumbled back into the red last year. But shares of DaimlerChrysler surged after he acknowledged in February that it was considering selling Chrysler, and the move to unload the U.S. auto maker gathered momentum. Cerberus was viewed as a strong contender to buy the company because of its deep pockets and the potential synergies to be had by marrying Chrysler's Chrysler Financial arm with Cerberus's 51% stake in GMAC, the former financing arm of GM. Cerberus could slash costs by consolidating Chrysler Financial and GMAC, analysts and deal makers say. Cerberus has invested in various auto-parts makers, including the German company Peguform, which manufactures interior and exterior plastic parts for the auto industry. Earlier this year, Cerberus strengthened its hand further when it hired Mr. Bernhard, the former Chrysler operating chief, as an adviser. Mr. Bernhard, viewed as a hands-on manager, is highly regarded by his former Chrysler colleagues. Cerberus, which is based in New York, made its name in the 1990s and earlier this decade as a buyer of bad loans around the world, foreclosing or settling the debts at a profit through hard-nosed tactics. Then it slowly moved into buying whole companies in countries like Germany and Japan that were struggling with high costs or bloated work forces. After acquiring these companies, it swiftly slashed costs, laid off workers and closed factories, shifting production to lower-cost spots in Asia. Though many industries in the U.S. and Europe are making similar moves, buyers like Cerberus typically make profits by drastically speeding up the process. Over the past couple of months, Chrysler officials have been asked by potential buyers like Cerberus for details and potential strategies for the coming UAW talks. One person familiar with the talks said they expected the groups vying for Chrysler would seek a provision tying an acquisition to certain concessions by the UAW. The key to the deal will be what happens to Chrysler's $18 billion in pension and health-care liabilities. The UAW and Detroit auto makers like GM have been studying a recent deal at Goodyear Tire & Rubber Co., in which the United Steelworkers union agreed to let Goodyear shift $1.2 billion in future health-care liabilities to a fund managed by the union. In return, Goodyear contributed $1 billion in cash and Goodyear stock to the fund. Getting a Goodyear-like deal from the UAW in this year's talks would be especially important at Chrysler because it could mean that neither DaimlerChrysler nor the purchaser of Chrysler would have the multibillion-dollar liability on its books. Given the auto industry's history of pattern bargaining, whatever arrangement the UAW reaches with Chrysler, other auto makers will likely demand similar terms. That could have major consequences for the union. Sean McAlinden, chief economist and vice president for the Center for Automotive Research in Ann Arbor, Mich., said he expects union contract negotiations this summer to be long and arduous. "If the union gave something to Chrysler, GM and Ford would demand it immediately, so this is not just about Chrysler," Mr. McAlinden said. If UAW President Ron Gettelfinger refuses to give in on concessions as he did last year with Chrysler, any agreement with a buyer could fall through. But that could put thousands more union jobs at risk because it would leave Chrysler little choice but to cut its work force deeply. With a private-equity owner, Chrysler would likely continue to expand its assembly-plant capacity outside North America, putting more pressure on the UAW and the Canadian Auto Workers union, people familiar with the matter said. Chrysler's new owners would inherit a recent agreement by DaimlerChrysler to build small Chrysler cars in China with Chery Automobile Co. Another issue is that Chrysler, like its Detroit rivals, has too many dealers. A new owner would likely take more drastic action to weed out some of Chrysler's 3,700 dealers, with some proposals calling for a 30% reduction in the dealer network, according to people familiar with the matter. Because of franchise laws, auto makers can't force dealers to close, and buying them out is costly. GM spent $2 billion to eliminate dealers to get rid of its Oldsmobile brand. | ||
| #74277 - in reply to #74248 |
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| petermerle Expert Date registered: Apr 2006 Location: Cape Town ( deep south ) Vehicle(s): W460 *1, W123 *2, W124 Posts: 1315  | Chrysler sell off What is no one talking about the Chrysler sale? PEter | ||
| #74306 - in reply to #74248 |
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| AlanMcR Expert Date registered: Apr 2006 Location: US, CA, Los Altos Vehicle(s): G300DT E300DT 230SL Posts: 3500 | RE: Chrysler sell off petermerle - 5/14/2007 9:49 AM What is no one talking about the Chrysler sale? PEter Err, um. It's bad form to speak ill of the dead? | ||
| #74328 - in reply to #74306 |
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| iNeon Date registered: Dec 1899 Location: Vehicle(s): | RE: Daimler-Benz again? I've never been more betrayed by or ashamed of my lineage as I am today. It's all about dollars. Benz knew they couldn't(and they tried with the 163, hard) build a viable truck for the American market, so they bought all the technology they needed in Chrysler and threw the rest to beancounters that will likely split divisions and make an American icon into something akin to the 'designer' labels at Target. I guess I'm a VW boy again. I'll be damned if Benz gets another dime from my unimportant, American pockets. | ||
| #74329 - in reply to #74248 |
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| UberXY Date registered: Dec 1899 Location: Vehicle(s): | RE: Chrysler sell off Good riddance. Steve | ||
| #74330 - in reply to #74306 |
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| AsianML Date registered: Dec 1899 Location: Vehicle(s): | Re: Daimler-Benz again? So do Dodge and Jeep stay? Or do they all go? What happens to current Dodge owners? I gotta check the Allpar forums about this. | ||
| #74331 - in reply to #74329 |
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| folidol Veteran Date registered: Jul 2006 Location: NYC Vehicle(s): Bombardier subway car Posts: 151  | RE: Chrysler sell off Because I just found out... Maybe, just maybe we'll get Mercedes-quality Mercedeses again. On the downside, will this have an impact on Mercedes sales and volume? Since the G is big, heavy, expensive to produce, etc etc... that probably makes it one of the first in the line of fire for getting terminated by Mercedes. I think. | ||
| #74332 - in reply to #74306 |
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| 4x4abc Date registered: Apr 2006 Location: La Paz, Baja California, Mexico Vehicle(s): 02 G500 | RE: Chrysler sell off Since the G is big, heavy, popular and relatively inexpensive to produce - we will have it around for a while | ||
| #74333 - in reply to #74332 |
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| cmitch Expert Date registered: Apr 2006 Location: Ala-Tenn Vehicle(s): 2002 ML320, 2005 S430 4Matic, 2010 F150 Super Crew Posts: 3412 | RE: Daimler-Benz again? iNeon - 5/14/2007 3:18 PM I've never been more betrayed by or ashamed of my lineage as I am today. It's all about dollars. Benz knew they couldn't(and they tried with the 163, hard) build a viable truck for the American market, so they bought all the technology they needed in Chrysler and threw the rest to beancounters that will likely split divisions and make an American icon into something akin to the 'designer' labels at Target. I guess I'm a VW boy again. I'll be damned if Benz gets another dime from my unimportant, American pockets. The ML IS a viable truck for the American market. It is one of MB's most successful products. It has it's problems, most of which can be traced to the German made Bosch parts, which said problems are shared with E and S classes. BTW, the W163 ML was not based in anything Chrysler designed. Several had been built well before the 'merger of equals' for testing purposes. The announcement for the ML plant came years before the merger. | ||
| #74337 - in reply to #74329 |
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| Merz-Ben Extreme Veteran Date registered: Aug 2006 Location: Floyds Knobs, IN 47119 Vehicle(s): 230G, U1200, U1250 DoKa, U1300L, U1500, U1700, 416 Posts: 377  | RE: Chrysler sell off Very true Harald. | ||
| #74338 - in reply to #74306 |
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| DUTCH Administrator Doppelgänger Date registered: Apr 2006 Location: US, GA, Atlanta Vehicle(s): 2015 Audi Q7 3.0 TDI,2018 Sprinter Posts: 9963 | RE: Chrysler sell off petermerle - 5/14/2007 12:49 PM What is no one talking about the Chrysler sale? PEter It's been discussed on the General Mercedes-Benz Forum since early this AM, where it should be and where this thread is being moved. | ||
| #74340 - in reply to #74306 |
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| AsianML Date registered: Dec 1899 Location: Vehicle(s): | RE: Daimler-Benz again? cmitch - 5/14/2007 5:10 PM Ditto. The merger officially occured in May of 1998 with talks beginning in January 1998. The very first ML rolled off the line in Vance in February 1997. Add the number of years they spent designing the ML and it will put you back to very close early-mid 1990 (1995-ish).iNeon - 5/14/2007 3:18 PM I've never been more betrayed by or ashamed of my lineage as I am today. It's all about dollars. Benz knew they couldn't(and they tried with the 163, hard) build a viable truck for the American market, so they bought all the technology they needed in Chrysler and threw the rest to beancounters that will likely split divisions and make an American icon into something akin to the 'designer' labels at Target. I guess I'm a VW boy again. I'll be damned if Benz gets another dime from my unimportant, American pockets. The ML IS a viable truck for the American market. It is one of MB's most successful products. It has it's problems, most of which can be traced to the German made Bosch parts, which said problems are shared with E and S classes. BTW, the W163 ML was not based in anything Chrysler designed. Several had been built well before the 'merger of equals' for testing purposes. The announcement for the ML plant came years before the merger. | ||
| #74342 - in reply to #74337 |
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| cmitch Expert Date registered: Apr 2006 Location: Ala-Tenn Vehicle(s): 2002 ML320, 2005 S430 4Matic, 2010 F150 Super Crew Posts: 3412 | RE: Daimler-Benz again? AsianML - 5/14/2007 4:39 PM cmitch - 5/14/2007 5:10 PM Ditto. The merger officially occured in May of 1998 with talks beginning in January 1998. The very first ML rolled off the line in Vance in February 1997. Add the number of years they spent designing the ML and it will put you back to very close early-mid 1990 (1995-ish).iNeon - 5/14/2007 3:18 PM I've never been more betrayed by or ashamed of my lineage as I am today. It's all about dollars. Benz knew they couldn't(and they tried with the 163, hard) build a viable truck for the American market, so they bought all the technology they needed in Chrysler and threw the rest to beancounters that will likely split divisions and make an American icon into something akin to the 'designer' labels at Target. I guess I'm a VW boy again. I'll be damned if Benz gets another dime from my unimportant, American pockets. The ML IS a viable truck for the American market. It is one of MB's most successful products. It has it's problems, most of which can be traced to the German made Bosch parts, which said problems are shared with E and S classes. BTW, the W163 ML was not based in anything Chrysler designed. Several had been built well before the 'merger of equals' for testing purposes. The announcement for the ML plant came years before the merger. I think the first ML was crash tested in May 1995. It was a butt ugly orange and black one. I'm sure many components were modified and completely altered to accommodate better results for future ML's. I'd love to see what was changed from the original one. | ||
| #74343 - in reply to #74342 |
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| AsianML Date registered: Dec 1899 Location: Vehicle(s): | Re: Daimler-Benz again? So, what happens to the headquarters in Auburn Hills? Would it still be used by Daimler-Benz (or whatever they plan on calling it)? | ||
| #74346 - in reply to #74343 |
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| AsianML Date registered: Dec 1899 Location: Vehicle(s): | RE: Daimler-Benz again? cmitch - 5/14/2007 5:43 PM Well, the first production ML was in 1997.AsianML - 5/14/2007 4:39 PM cmitch - 5/14/2007 5:10 PM Ditto. The merger officially occured in May of 1998 with talks beginning in January 1998. The very first ML rolled off the line in Vance in February 1997. Add the number of years they spent designing the ML and it will put you back to very close early-mid 1990 (1995-ish).iNeon - 5/14/2007 3:18 PM I've never been more betrayed by or ashamed of my lineage as I am today. It's all about dollars. Benz knew they couldn't(and they tried with the 163, hard) build a viable truck for the American market, so they bought all the technology they needed in Chrysler and threw the rest to beancounters that will likely split divisions and make an American icon into something akin to the 'designer' labels at Target. I guess I'm a VW boy again. I'll be damned if Benz gets another dime from my unimportant, American pockets. The ML IS a viable truck for the American market. It is one of MB's most successful products. It has it's problems, most of which can be traced to the German made Bosch parts, which said problems are shared with E and S classes. BTW, the W163 ML was not based in anything Chrysler designed. Several had been built well before the 'merger of equals' for testing purposes. The announcement for the ML plant came years before the merger. I think the first ML was crash tested in May 1995. It was a butt ugly orange and black one. I'm sure many components were modified and completely altered to accommodate better results for future ML's. I'd love to see what was changed from the original one. | ||
| #74347 - in reply to #74343 |
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| iNeon Date registered: Dec 1899 Location: Vehicle(s): | RE: Daimler-Benz again? You read, but you didn't listen. I said that they needed to learn how to build a car as cheaply built as the 163 was-- that's where Chrysler came in. Benz did a HORRENDOUS job starting the ML-Class line. They couldn't even get trim problems sorted out until well into the product's lifecycle, let alone the electrical issues. Chrysler never affected established Mercedes-Benz products in a negative way. Chrysler's people and technology helped perfect the w163 and to iron out the issues inherent in an all-new "German" econoSUV. Chrysler's people gave Benz most of their new product ideas and Chrysler's people tuned/massaged the w210 hand-me-downs in such a way that Benz is using it on their next E. "Engineered like no other.." my ass. The truth of this whole matter is that when it was DCX, the Germans funneled money away from Chrysler operations to prop-up their own economic shortcomings. They, themselves, badmouthed their little brothers, making it even harder for Chrysler to have any semblance of a good reputation. The Germans Touted their 'engineering' and Chrysler sales plummeted as a result. The Germans forced Chrysler to use their own substandard parts, lowering our reliability while simultaneously raising costs to consumers. Daimler is holding quite a bit of the Dodge trucks in this deal, and that just cements what I was saying originally-- THEY ONLY WANTED CHRYSLER SO THEY COULD LEARN TO BUILD GOOD CHEAP CARS AND TRUCKS. Nothing more. When Benz is in the same situation they are now in 5 years-- don't blame Chrysler. Your guys in Stuttgart ARE at fault for all of this. Chrysler was on the up-and-up when they were accquired and they couldn't be better off now. Good riddance indeed. | ||
| #74356 - in reply to #74248 |
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