D (C) pays $650m to dump Chrysler

http://money.cnn.com/2007/05/14/news/companies/chrysler_sale/index.htm?se
ction=money_topstories

Daimler pays to dump Chrysler
German automaker will end up actually paying $650 million to unload
Chrysler to end its exposure to billions in ongoing losses, healthcare
costs.
By Chris Isidore, CNNMoney.com senior writer
May 14 2007: 11:53 AM EDT

NEW YORK (CNNMoney.com) -- DaimlerChrysler moved to undo the most
expensive and one of the least successful mergers in auto industry
history Monday as it agreed to essentially pay to dump the money-losing
Chrysler unit which it paid $37 billion for nine years ago.

 

Looks like there are actually doing it. I hope us Chrysler owner's
don't get orphaned by not being able to get parts.

Seems like Daimler's biggest problem was the health care costs for
current and retired workers. Does Germany have a national healthcare
plan, so employers don't have to provide it? I wonder how German
autoworker wages compare with those of the U.S.

Kirk Matheson

 

Free at last, free at last! Halleluja, Chrysler's free at last!

.. I hope us Chrysler owner's

That's a completely mythical problem. Oldsmobile, AMC, Studebaker,
Hudson, MG, etc. parts are still available. Chrysler would be no different.

Besides, it wouldn't surprise me at all to see Chrysler come out ahead.
Remember, it was only 18 months ago that Chrysler was the best-selling
DC brand and the Mercedes division was the "money losing" divison.
Frankly, DC showed a lot of naivete by bailing so fast, and I think a
lot of it may have been the fact that Daimler was never really welcome
at Chrysler after it became a hostile takeover instead of a "merger of
equals." The whole point of a big multi-national corporation is so that
anytime that any one divison is unprofitable due to product cycles,
consumer preference, or whatever; the OTHER divisions remain profitable.

 

I feel you've hit the nail on the head.

Many reports indicate the D and C cultures didn't get along together.

 

At the time of the merger/takeover, some commentators were wondering how
it would work out: (a) D was run by engineers (fancy that!), whereas C
was run by "managers," who didn't necessarily know anything about
engineering, cars, or any other product; (b) the salary differential
between the lowest-paid and the highest-paid was way lower at D than at
C (and that's probably typical of any German company -- if not European
companies in general -- compared to any US company).

Perce

 

That's what I think. It just blows my mind that they even thought Chrysler
was a problem, let alone sold it. Chrysler is doing much better than GM and
Ford in the current sales downdraft. They lost 1 (one) Billion last year,
so that convinced Daimler to take 30 (thirty) Billion loss? They've gone
crazy. Chrysler will be fine.

I guess the cash cow didn't give milk for a few months so they sold it. They
forgot cows work on a cycle.

So anyway, go Chrysler! Goodbye Daimler!

 

I hear you....
Diamler can bite the big one.
I've worked with Dodge for 13 years and seen the end of the 12 year cycle
come and go.
Times with pick up again.
I still love my truck with high gas prices here
not everyone wants to drive a crayon box.
I do my commuting with my motorcycle to work when it permits.

All I've seen are to many chiefs (most are idiots) and too few indians.
Chrysler just needs good managment and weed out the bone heads up stairs.

 

Yes. Dream on USA workers.

High, due to the exchange rate which makes German workers wages even
higher as the US$ drops.

 

Well, I think BOTH "D" and "C" had a problem with balancing good
management and sound engineering. Throughout most of its history,
Chrysler engineers actually did have a lot of say. Periodically they'd
get overrulled by management and disaster followed (ie, introducing the
A-604 before it was working right- Iacocca saying "I'm gonna go take a
piss and when I get back tell me this thing is in production" legend-
maybe its true- circa 1988). On the other hand, Benz engineers often
were allowed to play around far too long and without realistic bounds,
hence the reputation for needlessly complicated and utterly UNreliable
cars that persists to this day. In short, Chrysler's engineers were
highly underrated and Benz's were highly overrated. A seamless blending
of the cultures would have been good for both companies, but both were
(in many ways justifiably) proud of their own histories and didn't
really like each other.

And it only got worse when it became clear that "D" was going to bleed
"C" dry to get through its own horrendous sales slump and
unprofitability shortly after the merger.

 

True until the top Merc executives started paying themselves US salaries...

DAS


For direct replies replace nospam with schmetterling

 

Not really. Unless the wager earners are spending their income on a lot
of products priced in USD, the currency exchange rate doesn't have a lot
of direct effect on their buying power at home.