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From: erschroedinger on 21 Jul 2010 15:56 On Jul 21, 7:31 am, "DAS" <nob...(a)spam.co.uk> wrote: > As a general comment, I think the Daimler/Chrysler situation is not black or > white, and various aspects have already been discussed by others. To me it > always looked like a takeover of Chrysler and did not buy/understand the > "merger of equals" talk. > > Clearly DB bit off more that it could chew and, I believe, was run by > megalomanic top management. I recall reading a respectable and founded > opinion piece about the rush to get the new joint company registered on the > NY stock exchange. A driving force for the German directors was to have > justification to raise their salary levels to the then stratospheric > American ones. No director of a German-listed company could ever have found > support for this. > > Regardless of the technical/mechanical arguments about technology transfer, > quality of Chrysler car (selling maybe 2m p.a. against 1m Mercedes cars at > the time of the fusion) and as a fan and long-term driver of Mercedes cars, > I always thought the idea stupid, a diversion of management attention from > the production of Merc-branded cars. Yes, maybe US sales growth was slow > but it was manageable, and the quality issues in the US plant were > eventually sorted out. > > The corporation had already made ill-advised excursions into unrelated areas > such as white goods (AEG kitchen equipment and the like, when AEG was losing > money hand over fist, later divested), and into aerospace, also a hugely > loss-making (and govt-subsidised) venture. The hypocrisy that the then > management managed was breathtaking. After previously complaining about > (German) govt subsidies going into other enterprises and how that should > end, they went cap in hand to the (German govt) bleating about the need for > subsidy. > > This was quite a few years before the Chrysler fiasco and I thought that > management had learned some lessons, but evidently not. > > I have already expressed these opinions here before some time ago, but I > thought them worth repeating as they are apposite to this discussion. > > Furthermore, I could not see how Daimler Benz (as it was then called) could > handle running a mid-market brand and an upmarket one (despite Merc having > become 'mass market') under one roof. It is a trick that Volkswagen have > pulled off but only after years (decades?) of careful nurturing of the Audi > marque, which had and has been part of the corporation for decades. > Downmarket/decrepit Skoda was acquired and integrated with great success but > under special circumstances. > > The Mercedes dealerships in Germany had real problems coming to terms with > having Chrysler in the group. > > DAS > > To reply directly replace 'nospam' with 'schmetterling' > --"Clive" <cl...(a)yewbank.demon.co.uk> wrote in message > > news:bobMK+X9ekRMFwDf(a)yewbank.demon.co.uk... > > > In message <zDr1o.36255$3%3.26...(a)newsfe23.iad>, Matthew Russotto > > <russo...(a)grace.speakeasy.net> writes > >>We have the trucks and buses here too. > > They also happen to make rather good locomotive engines too. > > -- > > Clive > > They should have studied BMW's purchase of a mass-market manufacturer, Rover, and all the problems that caused, such that BMW, I believe, sold it for the equivalent of one dollar just to get rid of it. I read Chrysler first tried to interest Fiat in merging, but Fiat said no. Interesting, because back in the 70s, Iacocca also tried to get Fiat interested in a merger, and Fiat said no then too.
From: DAS on 22 Jul 2010 18:41 Although I did think of the BMW/Rover mess as well, but it is quite different to Daimler/Chrysler. BMW sold it for a nominal sum but it came with very large debts, so it wasn't cheap for any buyer. Even so, BMW made the deal relatively sweet but the crooks who bought it pocketed vast sums. I never understood how the trades unions fell for the line that the buyers (4 senior managers from the team that had previously driven Rover into the ground in the first place) would continue production/sales at 250 000 per year. The alternative buyer (a financial group) said they would initially produce 50 000 per year of the MG sports car and related vehicles, a far more realistic proposition. It did not take long for Rover's sales to fall through 50K p.a. and then into bankruptcy. BTW, Rover long ago ceased being 'mass market' Relatively small and declining sales. DAS To reply directly replace 'nospam' with 'schmetterling' -- <erschroedinger(a)gmail.com> wrote in message news:8bfcf303-12bf-43dd-9f70-d3660af6aa01(a)d8g2000yqf.googlegroups.com... On Jul 21, 7:31 am, "DAS" <nob...(a)spam.co.uk> wrote: [...] They should have studied BMW's purchase of a mass-market manufacturer, Rover, and all the problems that caused, such that BMW, I believe, sold it for the equivalent of one dollar just to get rid of it. I read Chrysler first tried to interest Fiat in merging, but Fiat said no. Interesting, because back in the 70s, Iacocca also tried to get Fiat interested in a merger, and Fiat said no then too.
From: Josh S on 23 Jul 2010 15:17 In article <a892c551-c355-48b4-8bf3-d75942e41ff3(a)g19g2000yqc.googlegroups.com>, "erschroedinger(a)gmail.com" <erschroedinger(a)gmail.com> wrote: > > > > Converting the bread and butter cars to rear wheel drive. �Ignorant > > for that market segment. � > > That's what is selling. Yes to some, the Chrysler 300 series is very good in a segment of the market. But Chrysler lost their traditional FWD customers. We started buying Chryslers in the early 80s because of their FWD cars. Over the years we bought many of their cars new. A few years ago I had to replace my '95 Concorde with a used 2004 300M which I love. Nothing since the 300M interested me. I did have two weeks 300 experience with a rental 300, not my kind of car even if it was FWD. Our next FWD cars likely won't be Chrysler's, unless they finally come out with something that fits today's mid priced market. For now Chrysler is surviving selling trucks and the truck like 300.
From: Josh S on 23 Jul 2010 15:25 In article <3caab52d-7a15-447d-adc5-f4542da0335d(a)y13g2000yqa.googlegroups.com>, "erschroedinger(a)gmail.com" <erschroedinger(a)gmail.com> wrote: > "Starting in 1998, troops of managers started flocking to Auburn Hills > on a corporate jet. Soon the Germans discovered that Chrysler, which > has a long history of boom-and-bust cycles, was in much worse shape > than they anticipated. It spun deeply into crisis in 2000, racking up > $4.7 billion in operating losses the following year alone. Mercedes > had to make the ultimate sacrifice, squeezing its own costs to pump > out better profits for the group." > > -- http://www.businessweek.com/magazine/content/05_33/b3947001_mz001.htm http://www.businessweek.com/magazine/content/07_25/c4039024.htm Checking Under The Hood Of The Chrysler Deal Even though it has been 30 years since I worked for Chrysler (DCX ), the auctioning off of the division by Daimler deeply offends me ("A deal that could save Detroit," News & Insights, May 28). The idea that Daimler (DCX ) has been dragged down and German investors have somehow been cheated is a myopic vision of the situation. What happened to the *** $8 billion survival fund Chrysler had in the bank when the merger occurred? Was it used to buy Detroit Diesel Corp. outright and Mitsubishi Motors shares? Why did Daimler get rid of competent American management at Chrysler and install "sock puppets"?
From: erschroedinger on 23 Jul 2010 17:18
On Jul 23, 3:25 pm, Josh S <J...(a)clean.spam> wrote: > In article > <3caab52d-7a15-447d-adc5-f4542da03...(a)y13g2000yqa.googlegroups.com>, > > "erschroedin...(a)gmail.com" <erschroedin...(a)gmail.com> wrote: > > "Starting in 1998, troops of managers started flocking to Auburn Hills > > on a corporate jet. Soon the Germans discovered that Chrysler, which > > has a long history of boom-and-bust cycles, was in much worse shape > > than they anticipated. It spun deeply into crisis in 2000, racking up > > $4.7 billion in operating losses the following year alone. Mercedes > > had to make the ultimate sacrifice, squeezing its own costs to pump > > out better profits for the group." > > > --http://www.businessweek.com/magazine/content/05_33/b3947001_mz001.htm > > http://www.businessweek.com/magazine/content/07_25/c4039024.htm > Checking Under The Hood Of The Chrysler Deal > > Even though it has been 30 years since I worked for Chrysler (DCX ), the > auctioning off of the division by Daimler deeply offends me ("A deal > that could save Detroit," News & Insights, May 28). The idea that > Daimler (DCX ) has been dragged down and German investors have somehow > been cheated is a myopic vision of the situation. > > What happened to the > *** $8 billion survival fund Chrysler had in the bank when the merger > occurred? Wasn't there. Read Chrysler's 1997 annual report (I rechecked it -- I was a stockholder). 8 billion was the value of assets over liabilities -- that includes plants, machinery, etc., not all cash. > Was it used to buy Detroit Diesel Corp. outright and Mitsubishi Motors > shares? Why did Daimler get rid of competent American management at > Chrysler and install "sock puppets"? A lot resigned rather than work with the Daimler folk. Happens a lot in mergers, take-overs, etc. Besides, part of the reason for coming together was to save money by avoiding duplication -- of people as well as other things. And as for Mitsubishi -- Daimler was intersted in buying into Nissan, but the Chrysler folks said, "no, they're about to go bankrupt. Buy Mitsubishi -- we worked with those guys before." Of course, Mitsu was in bad financial shape and has misled everyone, including covering up recalls, warranty work, etc. When Damiler found this out and got rid of their piece of Mitsu, in return for the deception, Mitsu gave Daimler Mitsubishi Fuso trucks, which Daimler still owns. |