Daimler-Chrysler Divorce Negotiations Underway

Daimler-Chrysler Divorce Negotiations Underway

It seems the humorous but ultimately ineffective "Doctor Z" advertising
campaign was the last effort by German management to make something of
their acquisition of Chrysler. Negotiations are currently underway with
at least four private equity companies for sale of the Chrysler unit.

http://news.yahoo.com/s/nm/20070223/bs_nm/daimlerchrysler_privateequity_dc

Recently, The Economist observed very little integration had occurred
between Mercedes and Chrysler. This, of course, will make the divorce
easier, but may also have contributed to the failure of the marriage.

Still, it should be easy to unravel the assets. The Germans mostly
treated Chrysler as a captive parts customer, most evident in the move
to rear drive with the current Chrysler 300 and Dodge Charger, which
use rear suspensions and transmissions from previous Mercedes rear drive
applications. But while that was good for jobs in Germany, the decision
took Chrysler out of the mainstream market for large front drive cars.
The main advantage of rear drive over front drive occurs when very
powerful engines are installed. Yet most of the 300s and Chargers come
with 2.7s and 3.5s, which although large in the Germans' experience, are,
in the US, only premium mid sized engines.

Lack of front wheel drive has probably depressed Chrysler and Dodge sales
in states with significant snowfall. This likelyhood should have been
evident in advance to the Germans. In places like Minnesota and New
Hampshire, a Subaru Outback shares the garage space with the tri-star
bejeweled motor car. The Subaru is used to arrive places. The Mercedes
is used, in good weather, to demonstrate the owner has arrived.

But it wasn't just keeping Chrysler at arms length concerning product
development that caused this marriage to fail. While the Germans were
right to move Chrysler and Dodge upmarket, they failed to realize that
volume comes from lower priced cars - despite the in house example
provided by the C Class - and that volume is necessary. And so
discontinuing Plymouth was a huge error, tacitly acknowledged by their
refusal to sell the Neon as a Chrysler and by eventually eliminating
it from the Dodge line.

The real answer was to badge the PT Cruiser as a Plymouth according to
the original plan, keep the Neon, sell the four cylinder Sebring/Stratus
as Plymouths, assign the short wheelbase vans to Plymouth, and sell
Plymouths at both Chrysler and Dodge dealers. Yet this obvious
solution to multiple problems was ignored.

While the Germans may hope to obtain a decent price for Chrysler,
their bargaining position appears weak, because their own good
reputation will work against them. Both the recent "Doctor
Z" ad campaign and the previous short lived campaign claiming WWII
German rocket scientists were responsible for the early successes
of the US space program (true enough, but not known or accepted by
most Americans) displayed an attitude of nationality based management
and engineering superiority. Those potential buyers who believe it
will be hesitant to step in where the Germans, with their celebrated
skills, failed. Those who believe it is a myth will use the German
reputation for skill to overstate the difficulty and risks of the
situation, and reduce their offers for the Chrysler unit.

The auto industry's most peculiar marriage (they didn't even live
in the same house) is nearly over. And, for that, both owner groups
have plenty to cheer about.

 

Only if you are into drag racing. For street driving the advantages of RWD
apply regardless of engine size.

Actually I'd point to the ugly front ends they keep putting on cars,
especially that fugly truck one more that people affraid of RWD in the
snow.

 

On Feb 23, 9:56 pm, (Brent P)

I think you need a new keyboard...

 

Not true at all. FWD cars with strong engines often suffer from torque
steer. I'll take FWD in a small car for snow over RWD.

 

It was indeed driving in snow in a FWD car that totally won me over to the idea.

Graham

 

I'll second that. We don't get tons of snow here in Kansas City
(reports of 14 feet in New York state boggle my mind), but we get just
enough to demonstrate the value of front wheel drive. Rear wheel drive
cars were great when I was growing up in Texas, but why the hell would
anybody want one if they live where it snows at least once a year?
Especially here where it's hilly. Just the other day I was amused to
see a Crown Vic sliding helplessly toward the outside of a turn on a
hill. Of course I made the same turn easily in my Voyager.

Anyway, there's some kind of nostalgic mystique about a rear wheel drive
Mercedes, but I can't figure out what it's good for in the real world.

 

Very true. The advantages of RWD drive come mostly from handling and being
able to control all four wheels. These apply if you have a wimpy 4
cylinder or a monster V8.

My experience with 'powerful' FWD cars was a car known for it's torque
steer. But I had to stomp on it pretty hard for that to happen. I
understand in the last 18 years that's been sorted out for the most part
for normal street driving.

I'll take a RWD car over a FWD car in snow provided I have proper tires.
Control over all four wheels is more important in snow than it is on dry
pavement.

 

Having lived many years in Rochester NY and driving first a 1971 Dart
Swinger and later a 78 Malibu, rear wheel drive was just about useless on
snow even with 4 snow tires compared to front wheel drive. Although we live
in NC now, we happened to have a 20 inch snow storm a few years ago when I
had a 94 LHS. Virtually no snow plows and the temperature was below
freezing for a week. We stayed in the house for several days but eventually
needed to go food shopping (the snow came without warning). The streets
were all snow except for some ruts from 4WD vehicles. Especially true in
the cul d' sac where we lived. FWD LHS had absolutely no problems. In
fact, it was fun to drive it in the snow. Tires were just all weather
tires.

 

1971 snow tires are not proper tires.

I suppose that may be the same storm that dumped on chicago earlier. I
just went to work normally with a '97 mustang GT.

And driving in snow is fun if all the morons stay home. Actually I'd drive
in the snow that is falling right now if the roads were empty.

 

A high powered RWD car makes sense on the German Autoban, where they
drive 100+mph.
When high driving power is required you want separate wheels for
steering and power.

 

A very good article which brings out a lot of the things I saw wrong
with the DC takeover.
However I do believe there was a bit of Chrysler production going back
to Mercedes; a few engines.

I have the feeling DC was using Chrysler for their macho trucks and
cars, which look like they were designed by the truck designers.
Mercedes then sold the nice conservative looking cars, which they hoped
the LH buyers would go for.
What DC didn't appreciate is the Mercedes cars are far to expensive for
those who were buying the Chrysler mid size cars, so there they didn't
go.
Even the Chrysler 300 car line was quite a jump up in price for those
who had been driving the LH cars.
When I rejected my Chrysler dealers nth attempt to try out a 300, they
suggested I go look at the Toyota Camry at their other dealership. I
recently heard that my dealer sold his Chrysler dealership over a year
ago, but kept his Toyota dealership. Wasn't my fault! <

Several years ago I read a German DC executive say they wanted to move
Chrysler up in price level. Well they certainly did for the LH buyers,
but the customers weren't there.

Then we had the sudden jump in gas prices and the LH customers had to go
elsewhere for reasonable fuel economy in a mid sized car. Yes there is
the Sebring, but it has front seat space problems due to it's low and
rounded shape.
The 300's excessive weight to support the hemi engine removes it from
the economical car category.

I hope Chrysler survives this draining by Mercedes, but they will need
hard work by managers tuned into our NA market needs to get the company
back on track.

 

Well I assume you don't feel my Concord's 3.3 engine is strong. Well I
do, it's a real stump puller with great low end torque.
As for torque steer THERE IS NONE with it's engine layout.

My wife's Sebring has a bit of torque steer, but it's only noticeable
under flat out acceleration, which we seldom do.

Small can be OK to a point. You want the track to be wide enough to
follow the track of most vehicles. I've seen small vehicles having great
difficulty because the track is to narrow. Also a reasonable wheel base
is desirable, for directional stability.
I've driven them all, small to mid sized RWD, small RWD rear engine (the
VW beetle), small FWD, mid sized FWD and big mid sized FWD (LH cars).
In the horrible snow conditions we get, particularly driving up
mountains to our western Canada ski hills the large mid size has given
me the best drive in all snow and ice conditions.

 

Yes but American car manufacturers extract much lower BHP's from their
engines.
Therefore you should not compare European engines with American ones using
the cylinder capacity.

For example:

My Mercedes 3.5L V6 puts out 285 BHP and thats without any turbo or
supercharger.
Equivalent to 81 BHP per Litre.

The Ford Taurus 3L V6 I drive in the USA (how I hate that car) is only 152
BHP.
Equivalent to 50 BHP per litre.

Therefore what you consider a medium sized engine in a Mercedes is generally
putting out as much power as a large engine in most American manufactured
cars.

 

That's the car.

I used to own a 1981 Dat 210 RWD. Excellent car in the snow using
all weather tires.

It's all in the suspension and weight distribution. Those older cars didn't
have good suspensions.

Ted

 

That is why when I bought a Taurus, I got the 3.8L version.
You could burn the tires off the wheels with that engine.
The 3.0L and 3.8L put out the same power, just the 3.8L put out a lot more
torque.
Shortly after they stopped putting them in the Taurus and put them in the
Windstar vans instead which was about '96

 

Boy you sure don't drive in the same kind of snow we have here in Ontario.

 

1971 snow tires were great. They were better than a lot of "snow" tires they
sell today. Today's "snow" tires are often poorly treaded compared to those in
1971, because today there are so many front wheel drive cars, the tire
companies apparently think they can engineer them for quitness rather than
grippiness.

You have to get "All terrain" tires now in order to get _real_ snow tires. I
know, because I have 4 all terrain tires on my Jeep, and they're pretty much
the same as my Dad was buying for his cars in 1971.

Dave Head

 

Well, I'm in Ontario and enjoy the snow recently (not!) and have
a Cavalier and a 300E in my driveway. Both cars do well in the snow, both
have good snow tires. Hwoever, I also find the 300E better since the weight
is better distributed than in the cavalier.... no rear braking lose. All
in all, I also would chose RWD over FWD as long as good snow tyres are
mounted.

cheers, guenter

ps the 190E is another story though. Not enough weight in the rear without
the advantage of FWD. On the other hand, great car for learning how to drift

 

No one has talked about the real reason RWD is better than FWD. Sure the
FWDs are better in snow. Sure RWDs are better balanced. The real reason to
avoid FWD is maintenance cost. FWD vehicles were introduced to allow greater
use of robotics and lower cost of construction. This benefited the
manufacturer, not the owner. The labor cost of FWD is twice that for similar
jobs of RWDs when working in the front. Tire wear is twice that of RWD. CV
joint failures are not-existant on RWD and the list goes on.

PS The biggest difference between summer and winter tires is compound, not
tread design. It's all about tire heat.
Steve

 

True. One other thing is the amount of roll overs that happen with the FWD
autos. Going back before they became common one hardly ever read or heard of
a roll over.

Partly correct imo. The compund has a lot to do with the winter tire but all
the sticky in the world won't move you with out a aggressive tread. Small
blocks and sipes create the surface's to provide traction.

Eoy