The board of DaimlerChrysler is under increasing pressure to get shot of the ailing Chrysler division. According to industry sources, there are sound financial reasons to effect a de-merger, although company executives seem determined to restore Chrysler to profit.
It is generally accepted that Daimler and Chrysler are as culturally distinct as Lafite and lager, and that eight years on from the merger, the parties concerned are no closer than they were at the nuptials.
The problem is, what to do with Chrysler? It’s losing money, falling behind in the race for fuel-efficient cars, and faced with the need to trim costs by at least ,000 per vehicle. “No one would buy it,” an investment banker is reported to have said, although Renault and Volkswagen have both been suggested as possible future partners.
Despite the continuing denials by DaimlerChrysler that Chrysler is up for grabs - a good enough reason to believe the opposite - Chrysler’s pursuit of a partner with whom to develop small-car know-how has brought it face-to-face with China’s acquisitive Chery Automobile.
Given that Mr Chery already has his sights set on becoming the world’s fifth-largest car maker, what better way to leapfrog other young tigers than to acquire a major American brand? Moreover, Chrysler is the company that makes Jeeps, and not only is China a perfect market for 4×4s. it is also home to the world’s largest army, and we all know what armies buy.
