Latest Articles by Dwyane

DCX growing stronger

Sat, 19 May 2007 00:00:00 -0500

The news about the sale of Chrysler has caused Daimler shares to rise but on the part of Chrysler, Wall Street analysts are doubtful whether it can make it alone.

Wall Street analysts view the pronouncement sale of Chrysler by its parent company DaimlerChrysler AG the producer of Mercedes 300D parts has been advantageous for the German automaker but still taking a wait-and-see approach to see whether the Auburn Hills-based Chrysler can make it on its own.

The DaimlerChrysler stock (DCX) closed Monday at $84.12 up by $2.12 or 2.6 percent a share. It was also a good news for DaimlerChrysler when some analysts has listed the stock as a strong buy with one German analyst estimating the stock could eventually reach $120 especially when the deal on the sale of Chrysler is finished.

Analysts further say that the sale of the 80.1 percent of Chrysler to Cerberus has long been anticipated. The sale of Chrysler to the private multi-billion dollar investment firm would benefit both sides however they would have to sacrifice their nine years of partnership. The downfall of the DaimlerChrysler merger as viewed by many is caused by the different goals and different operating of the two automakers.

Despite the fluctuation on the stock price of DaimlerChrysler’s shares it has still been able to record an increase of $2.12 especially after the official announcement was made on the sale of Chrysler last February 14, 2007.

Craig Hutson, an analyst with Gimme Credit in Chicago said, "The Daimler stock since Feb. 14 when it was announced they were exploring options to sell off Chrysler has dramatically outperformed the market and its peers. Daimler had put itself in a position they had to go forward with a deal. Largely the sale was anticipated by the market, which could be one reason for the somewhat muted response after the announcement."

Last February 1 DCX traded at $63.12 and then suddenly increased to $69.78 on Valentine’s Day the day the DaimlerChrysler CEO Dieter Zetsche has announced that all options were being considered for Chrysler including its possible sales.

Then on April 5 after the announcement DCX reached an amazing increase trading at $84.80. The remarkable growth in price of DaimlerChrysler’s share according to most analysts will continue especially after the expected sale of Chrysler is concluded by the third quarter of this year.

Here are the benefits that Daimler will reap after the sale of Chrysler:

1. Daimler will become more stable and will face lesser financial risk without Chrysler.

2. Daimler will also get rid of the $19 billion in pension and health care liabilities that it will shoulder if its money-losing arm is not sold.

3. Daimler can now focus all its efforts, time, energy, and finances on profitable ventures especially on its premier cars and trucks.

According to Jack R. Nerad, an analyst with KBB in Irvine, California, "I see this as a very good move for Daimler."

Daimler is not the only one with the advantages even Chrysler will obtain benefits out from the sale such as:

1. Chrysler will finally get large cash funding from its new owners. This will give the Auburn Hills automaker far greater staying power to compete with the likes of Ford, General Motors and other foreign automakers.

2. Chrysler may now also focus its efforts in developing long terms strategy instead of worrying how it would fare from quarter to quarter.

3. Chrysler may now focus on North American and who knows maybe the inroads Jeep has made into China.

--
Dwyane Thomas is a part time cook and full-time auto-enthusiast. This 31-year old Civil and Environmental graduate is a consultant at one of the engineering firms in Pennsylvania.

Source: http://www.articletrader.com

Mercedes-Benz USA choose Brunswick for its VPC

Sat, 19 May 2007 00:00:00 -0500

Governor Sonny has recently congratulated Mercedes-Benz USA the US subsidiary and distributor of quality Mercedes products such as Mercedes 300E parts for choosing Brunswick as its site for its new vehicle preparation center (VPC) for vehicles being imported into the US.

According to Governor Sonny Perdue, "We have made wise investments in replacing the Sidney Lanier Bridge, deepening the Brunswick Harbor, completing the overpass on Highway 17 and constructing the North/South connector road on Colonel’s Island. Mercedes-Benz USA is the first of what I hope will be many of our state’s customers to benefit from our increased accessibility for automobile manufacturers."

In addition Mercedes-Benz USA has also announced that there would be an additional of 50,000 imports through Brunswick which will be consolidated with the more than 75,000 Mercedes-Benz vehicles that are currently being exported through the Port of Brunswick each year. This consolidation was likened to what Hyundai/Kia has done in recent years to combine its import operations in Brunswick.

Ernst Lieb, president & CEO, Mercedes-Benz USA said, "The move to Brunswick represents a tremendous opportunity for Mercedes-Benz in terms of further improving efficiencies for our southeast Vehicle Preparation Center - one of the critical steps in the process of bringing new vehicles to market. The proximity to the port, combined with better railroad and highway access and room for expansion, make Brunswick an excellent location for this facility. With quality being our top priority, the new VPC is an important step toward consistently delivering the best vehicles to our dealerships and ultimately our customers."

The recent announcement will either create or transfer 41 Mercedes-Benz USA jobs in Brunswick that is in addition to the other jobs that will be generated in the rail, shipping, and trucking industries. The present vehicle preparation center of the US subsidiary of Mercedes-Benz is located in Jacksonville.

Mercedes-Benz USA is expecting for the completion of the ongoing facility by the first quarter of 2009. The Vehicle Preparation Center is going to be the first stop for new vehicles bounded for Mercedes-Benz dealerships through out the United States after it pass through the US Customs. The Vehicle Preparation Center is the final quality inspection point and it is equipped with advanced computerized control systems and inspection facilities designed to ensure the high quality condition of each vehicle. After the rigid inspection process that is only the time the vehicles are released.

According to Georgia Ports Authority Chairman of the Board Mack Mattingly, “The harbor deepening and new access to the south side of Colonel’s Island means the Brunswick Port can meet the needs of any automaker in the world. Mercedes-Benz USA has achieved 13 consecutive years of sales growth, and we are proud that they will continue to grow and thrive because of increased efficiencies provided by this new facility.”

Fourth Generation C-Class soon to hit showrooms

Sat, 19 May 2007 00:00:00 -0500

The C-Class has been the best-selling model of Mercedes-Benz manufacturer of top of the line Mercedes C230 parts for the past 25 years. This is also the reason why when the coming of the fourth generation C-Class was announced, Mercedes had to take into account the traditional owners and at the same time try to attract young buyers who are more interested in sports sedan.

To solve this problem the 2008 C-Class that hit Canadian showrooms have two distinctly different appearing models. The new models are based on the 3.0 liter DOHC V6 model called the C300 and C300 Sport; while the C350 Sport was based on the 3.5 liter DOHC V6. The models are identified by the different grille that they have. The C300 and C350 are identified by their classic louvered grille which is intended to attract those conservative buyers. On the other hand the C300 Sport and C350 Sport are given the big ring with three-pointed start that used to be reserved exclusively for its highest two-door performance cars such as the SL.

The overall styling cues were derived from the premium luxury CLS sedan with an upward wave from the hood that flows over the concave roofline to a swooping rear deck. The aggressive looking Sport may also be equipped with an AMG sports package that includes lower front and rear aprons and side skirts.

For Europe there would be eight models of which will include three diesels and it does not include whatever AMG, the Mercedes-Benz in-house tuner company does. However, the company assures that customers who prefer AMG on their Mercedes such as an AMG C-Class with a 5.5 liter or 6.3 liter V8 is possible.

The pricing of the fourth generation Mercedes-Benz C-Class in Canada is scheduled for released hopefully by the end of August. But unlike the current model the fourth generation will be priced slightly higher. Just like what Mercedes-Benz Canada did with the E-Class last year, more content will also be added but with the same price as that of the previous model.

Both C-Class models will employ V6, quad cam engines of 3.0 liters and 3.5 liters respectively. The 3.0 liter produces 231 hp and 300 lb/ft of torque while the 3.5 liters revs up 272 hp and a full 350 lb/ft of torque.

A diesel C-Class may also be introduce by the end of this year and hopefully will come equipped with the eco-friendly Bluetec V6. It would be better if Mercedes-Benz can couple their gasoline engines with a seven-speed electronic automatic transmission. There is already a six-speed manual offered on the C280 in Europe.

The 3.0 liter engine enables the C-Class to accelerate from 0 to 100 km/h in only a matter of 7.3 seconds. Its tops speed is 250 km/h and record a fuel economy of 9.4L/100 km combined city/highway. The 3.5 liter can sprint from 0 to 100 km/h by almost a second to 6.4 seconds with top speed limited to 250 km/h with an estimated fuel rating if 9.7L/100 km.

The suspension is same for both with three links at the front plus coil springs and stabilizer bar. The gas shocks has an amplitude-dependent damping system called Agility Control which stabilizes the body of the vehicle no matter how hard the shocks are or even when the shocks are not working properly.

The rear suspension is the latest innovation of the legendary Mercedes-Benz multi-link independent system. It possess both anti-squat and anti-dive built in which means that the rear will not go down once the gas is hit and will not go up when the brakes are applied. The gas shocks have also amplitude-dependent damping and a hefty stabilizer bar.

And probably for released next year is the Advanced Agility package and thanks to the cutting-edge computers the system provides a choice of tow gearshift/handling programs called Sport or Comfort. Although the system is complex meaning each shock absorber is infinitely variable, but all four work together to provide quality ride and handling capabilities. In the sport mode, the body is also lowered by 15 mm while the transmission is remapped for crisper shifts. Brakes are comprised of discs located at all four corners plus of course don’t forget ABS, Brake Assist and electronic stability control (ESP) which are offered as standard safety features on all Mercedes-Benz cars.

Preview before the race at the EuroSpeedway

Sat, 19 May 2007 00:00:00 -0500

The excitement is swelling up for the coming Deutsche Tourenwagen Masters or the German Touring Car Masters. And to get an idea on what to expect at the race here is a preview before the race at the EuroSpeedway.

The Lausitzring race track has been improved. The front straight has been extended by 36 meters to 672 meters and then followed by a sharp left-hander. The main objective for this is to create more opportunities for outbraking. At this particular part of the track the cars are slowed down from 245 kph to a little over 85 kph. Last year the wide first corner which provides several racing lines allowed speed of 130 kph.

There are six podium positions which are to be occupied by six different drivers for the 2007 season’s first two races. The drivers are the following: Mattias Ekström, Martin Tomczyk and Rockenfeller (Audi); Daniel la Rosa, Gary Paffett, and Paul di Resta (for Mercedes-Benz brand of the quality Mercedes car covers).

At last year’s race Bernd Schneider has been able to repeat his victory in the season opener in the second race. Tom Kristensen from Audi also came home second twice. The only position that changes at last year’s race is the third place wherein Mika Häkkinen driver of an AMG Mercedes C-Class and third at the Lausitzring trailed behind Heinz-Harald Frentzen of Audi who was third in Hockenheim.

Team Persson Motorsport is the only team that obtain high points with three cars each in both of the 2007 season’s first two races in which they entered the C-Class cars of Gary Paffett, paul di Resta, and Alexandros Margaritis. In Oschersleben, the team of Ingmar Persson was not only been able to achieve their first DTM win but was able to make it 1-2 victory. The team was has also scored 19 points more than the other teams in one race.

For the new Mercedes-Benz C-Class, podium positions have been made possible in both races. In Hockenheim, Bruno Spengler (DaimlerChrysler Bank AMG Mercedes) was able to finish third after pole position and 11 lead laps but unfortunately dropped to 14th by a time penalty after the race.

In Oschersleben, Mika Häkkinen (AMG Mercedes) has started from pole position, ran third until the second to last lap but still fall to 17th place following an extra pitstop caused by a damaged tire resulting from a race accident. Jamie Green was able to record the fastest lap of the race but even with such a record he still lost the chance for a podium finish by a drive-through penalty.

Here are the quotes before the race at the EuroSpeedway

Gary Paffett (Laureus AMG Mercedes C-Class 2006): After winning the race in Oschersleben my car will even be heavier and it will be more difficult to repeat this success. However, the atmosphere within our team is great and everybody is confident that we will achieve another good result at the Lausitzring where I won two years ago.”

Paul di Resta (JAWA4U.de AMG Mercedes C-Class 2005): “We have continuously improved throughout the first two races and we focus to maintain this level. Then we should be among the front runners again.”

Bernd Schneider (Genuine Parts AMG Mercedes C-Class 2007): “I have won at the Lausitzring three times and I like this track. It would be great if I could achieve the first race win for the new C-Class here.”

Alexandros Margaritis (stern AMG Mercedes C-Class 2006): “Six points out of the first two races were a reasonable start into the season. I want to improve further.”

Jamie Green (Salzgitter AMG Mercedes C-Class 2007): “At the Lausitzring I achieved two poles so far, so the track suits me. This time I want to be at the front also in the race.”

Mathias Lauda (Trilux AMG Mercedes C-Class 2006): “I had expected more than two 13th places for the first two races. I can do better than that as I want to show at the Lausitzring.”

Daniel la Rosa (TrekStor AMG Mercedes C-Class 2006): “The Lausitzring event is the home race for our team Mücke Motorsport. I look forward to the great atmosphere with the packed grandstand and I want to show that my 14th place at Oschersleben was only a one-off.”

Susie Stoddart (TV Spielfilm AMG Mercedes C-Class 2005): “After a disappointing weekend in Oschersleben, I hope to get back on the pace and fight for points in the race at Lausitzring.”

Mika Häkkinen (AMG Mercedes C-Class 2007): “At the Lausitzring, we don’t know the modified first corner yet. Therefore, Friday’s tests will be even more important. I finished third twice at this circuit and two years after my first DTM victory I finally want to end on the top spot this time. A pole like in Oschersleben would be the best.”

Bruno Spengler (DaimlerChrysler Bank AMG Mercedes C-Class 2007): “Two promising races but finally no points - this was a difficult start into the season for me. However, the new C-Class has a lot of potential and at the Lausitzring I finally want to win.”

Norbert Haug, Vice President Mercedes-Benz Motorsport: „The previous race in Oscherslaben has shown that the DTM is as competitive as never before and consequently, surprising results like the first-class operating Persson team’s 1-2 victory with Gary Paffett and Paul di Resta are possible. Mercedes-Benz led more than 76 percent of all the first two races’ laps, scored most of the points, and in Oschersleben the new C-Class had the best speed of all competitors, including pole position, fastest race lap and best average lap times over the distance. However, the most important is still missing - a victory. At the Lausitzring we aim for that as well as for a positive team result.

Zetsche: Letting go is always hard to do

Sat, 19 May 2007 00:00:00 -0500

The decision to let go of Chrysler sure was not an easy one. In fairness to Daimler it has tried to help its American automaker partner by providing additional investment but despite the efforts still Chrysler was not able to regain financial health. This exactly what forced Daimler to finally consider selling its money-losing arm.

It can be remembered that when Dieter Zetsche returned to Germany in the fall of 2005 to assume the position as the next CEO of DaimlerChrysler AG, he has vowed to develop an effective working partnership between Mercedes-Benz brand of quality Mercedes 190E parts and the Chrysler Group. Zetsche said, "Early on in my new assignment, I pushed the organization to leverage the merger to the maximum extent." Unfortunately the effort resulted to an unfavorable effect. Instead of developing new ways for the German and US auto divisions to work together, it somewhat defined the limits of their potential cooperation.

CEO Dieter Zetsche is said to be the German executive who have rescued Chrysler from bankruptcy in 2001 and 2002 but under the pressure of angry investors even the savior is left with no other choice but to create the contract to sell the automaker from Auburn Hills.

The chosen new owner of Chrysler is the private equity firm Cerberus Capital Management. The sale of Chrysler to Cerberus was unanimously approved by DaimlerChrysler’s supervisory board.

According to Zetsche, "Even though I went through an emotional roller coaster in the past year, I'm glad of the outcome of the process. I'm very confident we've found a strong, sound and sustainable base for a new Chrysler."

The endorsement that came from Ron Gettelfinger, the President of the United Auto Workers came as a surprise since in most of his interviews he has stressed over and over again that he prefers Chrysler to remain with Daimler rather than ending up controlled by a private firm. The endorsement from UAW President has helped sway the other labor representatives on the supervisory board to approve the sale to Cerberus.

Employee representatives hold 10 to 20 seats and according to Zetsche that they seemed to be satisfied that the deal with Cerberus has taken into account the well-being of Chrysler’s 80,000 employees. Zetsche also added, "That was my agenda as well. It was very much a consensus-based meeting. There was no controversy or tension."

The deal is expected to conclude in the third quarter and finally ending the nine-year merger of Daimler-Benz and Chrysler Corp. Some German papers like the tabloid Bild have rejoiced over the sale of Chrysler and declared, “Finally, we got rid of Chrysler!”

However inside DaimlerChrysler the mood was different and even strange according to employees. The sale of Chrysler will definitely bring changes to Daimler and the first thing will be the changing of name from DaimlerChrysler to being Daimler-Benz again. Daimler is hoping to reposition itself as a premium carmaker with a market-leading heavy-truck business. The separation of Chrysler has shrunk the company’s size in time when all its other rivals are combining forces.

Now that Daimler and Chrysler are finally separating ways, Zetsche was asked why the merger didn’t workout to which he answered Daimler had overestimated the potential synergies between Chrysler and Mercedes.

There was also a problem in terms of sharing components caused by the big price gaps between Mercedes and Chrysler vehicles. Zetsche further added that DaimlerChrysler has also miscalculated the impact that the transfer of Mercedes technology would have on Chrysler’s brand especially when it comes to the pricing of its vehicles.

Chrysler’s position in the company further weakened last year when it incurred a total of $1.5 billion loss in the third quarter brought about by the high gas prices cut demand for its vehicles. Zetsche has also made it clear that the decision to sell Chrysler occurred gradually. "There wasn't one triggering event."

Last February 14, Zetsche shocked the world when he announced that all options were under consideration for Chrysler. And when asked when the company decided to sell Chrysler, he said, "There was no one day, but a gradual development, with a growing likelihood in one direction."

The time that Zetsche has lined up the whole supervisory board to support him in forming the merger shows his remarkable ability as a consensus-builder unfortunately the rest of the sale were handled clumsily.

Gerald Meyers, a business professor at the University of Michigan and former Chairman of the AMC automaker acquired in 1987 by Chrysler said, "He knowingly -- I think unknowingly -- put the company in play, turned it over to investment bankers and in the process demeaned the company and demoralized the work force."

At present the deal between Cerberus and Daimler is not yet finished, Zetsche said that he would remain in charge until the deal is finally concluded. He said, "Until the day of the closing, this is a company of DaimlerChrysler. Tom LaSorda and the management will report to me."

Chrysler says bye Daimler and leaves it with $2 Billion first quarter loss

Sat, 19 May 2007 00:00:00 -0500

Daimler: Sorry dear Chrysler but this is it. I have sold you to the three headed dog Cerberus.
Chrysler: Its ok, Daimler dear I perfectly understand…and by the way would you be so sweet and take care of my $2 billion first-quarter loss?
Daimler: Ok dear but remember I have the good end of the deal, ok?
Chrysler: Of course dear…

The sale of Chrysler has ended up like a comedy skit. Reports have cited that CEO Zetsche is saddened by the split of DaimlerChrysler, saying that the Auburn Hills automaker did also contribute to Daimler and was not always reporting losses. But with the present $2 billion first quarter loss that Chrysler has reported, will CEO Zetsche still think better of Chrysler?

Despite the loss that Chrysler has again incurred it is still very positive that it will be able to break-even for the rest of the year. It can be noted that Chrysler has previously reported a $1.2 billion resulting from the restructuring program that the automaker is implementing. The said loss was reported last February 14, the very same day that CEO Zetsche has announced that Chrysler is up for sale.

DaimlerChrysler Chief Financial Officer Bodo Uebber has forecasted a $2.1 billion full-year loss for Chrysler that is before interest and taxes. The forecast was announced during a teleconference with reporters and financial analysts. However analysts have a different view and considered the forecast stating a big improvement in Chrysler’s earnings in the current quarter as well as the second half of the 2007 as too much to expect.

As a matter of fact, according to New-York based analysts Brad Rubin at investment bank BNP-Paribas, "I think that's overly optimistic. I think it's going to be very difficult."

It is no secret that Chrysler is depending on the rollout of new vehicles to increase its sales. To start off its recovery plan it has launched recently the Dodge Avenger sedan and will be introducing new minivans by fall.

Despite the first quarter losses that Chrysler has obtain, DaimlerChrysler’s net profit for January through March have double to $2.6 billion which simply shows a turnaround of its reviving Mercedes-Benz luxury car-making division not to mention the additional earnings that DaimlerChrysler gets from its holding in the aerospace company EADS.

Uebber said that company’s earnings for 2007 would be slightly above $9 billion that is before interest and taxes however the yearly net profit would still be undercut by costs related to Chrysler sale. And estimating those costs it will probably reach between $4 billion and $5 billion.

DaimlerChrysler the producer of top of the line Mercedes 240D parts has also announced that it will be selling an 80.1 percent stake in Chrysler’s industrial and financial operations to Cerberus Capital Management for $7.4 billion which will mostly go into Chrysler’s operations. The deal is expected to end in the third quarter.

Will Chrysler gain any benefits from the sale? Chrysler as a would-be privately owned business will be shielded from the impatience of the financial markets and on their focus on short-term results. But according to CEO Tom LaSorda despite the new benefits and advantages that Chrysler will obtain from its new owner, the company would still strive hard to improve its performance.

Chrysler has reported first quarter loss before interest and taxes compares with a $857 profit for the January-March quarter of 2006, before the continuously increasing gas prices began affecting the demand for its vehicles. Sadly for Chrysler that trend has continued in the quarter just ended resulting to an 8 percent decline in the sales of Chrysler, Dodge, and Jeep vehicles.

Catena enters 2nd Mercedes Benz dealership

Sat, 19 May 2007 00:00:00 -0500

Catena, President of Edison- based Ray Catena Motors, initiated the opening of his second Mercedes-Benz dealership. Ray Catena Mercedes-Benz has been a family business since 1959. It began with a simple used car lot and has evolved into an excellent sales leader within the Mercedes-Benz USA's (MBUSA) franchise network.

Catena proudly said that their main aim when they started the franchise business was to do one thing completely. He further said that the opening of their new facility in Union will grant them the opportunity to exalt even higher the experience that their customers already have with them.

Opened to the public for them to see the evolved franchise business, the eloquent event was held from 5 o’clock up to 9 o’clock in the afternoon. It included several odysseys to the refined showroom and service facility that showcased the latest models in the Mercedes-Benz product line-up. It was really a marvelous event that marked another milestone to Mercedes.

During the classy event, Ray Catena Mercedes-Benz of Union gave a toast to a successful future with their clients and guests, while raising essential funds for "Bright Steps Forward".

The General Manager of Mercedes-Benz USA's Northeast Region, Joseph Kurp, said Ray Catena has long been a standing member of the Mercedes-Benz dealer arena. He further said that Catena plays an important role in the success of Mercedes-Benz in the US as a brand in a strictly competitive Tri-State market.

Kurp also said that Ray Catena Mercedes-Benz of Union is giving the customers a high- level of service through the establishment of a new and conveniently located Mercedes-Benz dealership in Union, New Jersey.

About "Bright Steps Forward"

"Bright Steps Forward" is an organization that facilitates unswerving pediatric therapy for those children who cannot afford medical services. During the opening of Ray Catena Mercedes-Benz of Union, guests who made contributions of $100 or more to "Bright Steps Forward" will be entered into a draw for a 27-month lease of a new Mercedes-Benz R350. The said contains a top of the line Mercedes performance chip. The winner was drawn live in the event. A silent auction was also held to financially and emotionally support this life-changing charity.

About Mercedes-Benz USA (MBUSA)

With its headquarter in Montvale, New Jersey, Mercedes-Benz USA (MBUSA) is the group that is responsible for the sales, marketing and service of all Mercedes-Benz and Maybach products in the United States. MBUSA reached the all-time sales record of 248,080 new vehicles in 2006. This has set the highest sales volume ever in its history and has achieved 13 consecutive years of sales growth. Its northeastern regional office which is based in Parsippany, NJ is the on responsible for advertising, sales and marketing initiatives for the 94 dealers of Mercedes that are located in the Northeast of the country.

Though a German car, Mercedes-Benz continues its struggle in topping the US auto mobile market. And this new Ray Catena Mercedes-Benz of Union is a proof of such struggle.

Changes at DaimlerChrysler

Thu, 17 May 2007 00:00:00 -0500

So many changes are taking place in DaimlerChrysler the maker of high quality Mercedes wipers. And it’s not just about Chrysler being transferred to Cerberus but also include reshuffling of positions inside the company.

The DaimlerChrysler Board of Management has appointed Rainer Genes, Manager of the Bremen production plant, as the new head of Production Planning Mercedes-Benz Passenger Cars effective June 1, 2007. Rainer Genes will replace Simon Boag who will be going back to Detroit on June 1, 2007 the same day that Genes will sit as the new Head of Production Planning.

Peter Scabert who is the current director of the Berlin production plant will also take over the responsibility for the Bremen plant also starting June 1, 2007.

Thomas Uhr, who is at present the head of the Production and Technology Center--- “Casting and Metal Forming” (PTU) --- will similarly takeover as the head of the Berlin plant on June 1.

Belte a part of the Vodafone McLaren Mercedes
Just recently ALUTEC-BELTE AG and Vodafone McLaren has made official their long-term partnership. BELTE becomes the team’s official supplier for heat treatment solutions.

It was in 1998 in Delbrück, Germany, the BELTE has established itself in Europe as the technology leader in aluminum heat treatment solutions. And presently it is implementing its global expansion strategy by partnering with major multi-national corporations in the automotive and aerospace industries.

Markus Belte, CEO said, "BELTE is very excited about joining Vodafone McLaren Mercedes - a team that demands the very best technology and engineering design. We are looking forward to contributing advanced technology to the team as well as using the Vodafone McLaren Mercedes global marketing platform to strengthen the implementation of our strategy to position BELTE as the market leader worldwide in aluminum heat treatment solutions."

Jonathan Neale, Managing Director, McLaren Racing also welcomes the partnership and said, “We are delighted to welcome BELTE as an Official Supplier to Vodafone McLaren Mercedes. Both BELTE and the team share the same core focus on innovation and engineering excellence. We are confident that Vodafone McLaren Mercedes can strongly support BELTE in its global expansion plans - this is an exciting step and we look forward to a successful future together."

DaimlerChrysler: The end of the "marriage made in heaven"

Thu, 17 May 2007 00:00:00 -0500

The nine years merger of Daimler-Benz and Chrysler AG is finally coming to an end as the German automaker hands over the control of its money-losing American arm to Cerberus. It can be remembered that the merger between Daimler and Chrysler AG was dubbed as a merger of equals and a marriage made in heaven---the merger was suppose to become the perfect model for the future of auto manufacturing worldwide. Sadly after nine years the merger proved to be neither.

Daimler-Benz the producer of top-of-the-line Mercedes trans mount has purchased Chrysler AG for $36 billion in 1998 and after nearly a decade of fluctuating earnings and repeated cost cutting, Daimler-Benz has finally come to a decision that it has to let go of Chrysler AG. Through it all there was the boiling resentment of German shareholders who felt that the American arm of Daimler-Benz has only stained the name of one of their country’s greatest carmakers.

And now with the company to split in a 5.5 billion euro deal which is only a fraction of Chrysler’s value nine years ago, the merger would just serve as reminder that large scale partnerships usually doesn’t succeed.

The separation of DaimlerChrysler is just one of the many auto partnerships that collapse in the past few years. Take for instance the case of GM that paid $2 billion in 2005 just to break off its alliance with Fiat SpA after the Italian company’s finances and market shares declines. Then in 1990 another partnership was formed but this time between BMW AG and Britain’s MG River in which the former has lost billions only to separate by 2000.

In the mid-1990, Daimler-Benz was really searching for new markets and new opportunities at the dawn of what many would consider as the age of global consolidation. Chrysler during that time happens to be an ideal target with its line of cleverly designed, efficiently built minivans, Jeeps, and pickups. Plus the fact that US is a rich country with lots of car aficionados…somehow a partnership with Chrysler make sense at that time.

At the start of the merger the two automakers have made it clear that their partnership is a “merger of equals” which was later dismissed by Juergen Schrempp in an interview which caused him a lawsuit from billionaire investor Kirk Kerkorian. He lost and it was just obvious that the center of power is in the favor of the gentleman from Stuttgart.

The company tries to recover out from a brutal 2001 restructuring and launched hits like the 300C but even this didn’t help and earnings have continued to slip. The problem didn’t stop there after the declining sales and the numerous recalls over defects DaimlerChrysler dumped its cross-border venture with Mitsubishi in Asia in the year 2004.

The increasing gas prices have also taken its toll on Chrysler especially since most consumers have shifted to purchasing small cars with better mileage. Competition has also become more difficult for Chrysler with Japan’s Toyota entering the main stream not to mention its other two strong rivals GM and Ford still getting a big bite off the market share. All these have contributed to the crippling of the US arm of Daimler.

The losses at Chrysler would have not been so pronounced if not for Mercedes posting its first quarterly loss in ten years in 2005 which was attributed to poor quality and high cost. Shareholders began to doubt the relevance of Chrysler as a partner saying that it is damaging the reputation of the company’s jewel, Mercedes-Benz. They began to compare Daimler with the rest of the purely German automakers such as BMW and Porsche which is sustained by only high margin luxury cars. They started clamoring for the sale of Chrysler. And then finally it was announced that DaimlerChrysler is considering all options for the sale of Chrysler.

There is one partnership that remains strong after seven years of merger—the Nissan Motor Co. and France’s Renault SA which according to some analysts is a cooperation that works. According to Nissan and Renault Chief Executive Carlos Ghosn, the merger has become profitable for both companies as a matter of fact Renault’s market value has tripled while that of Nissan has grown fivefold. The French automaker also own 44 percent stake in Nissan.

DaimlerChrysler Obtain Profit for Q1…Chrysler to be handed to Cerberus

Thu, 17 May 2007 00:00:00 -0500

DaimlerChrysler, the world’s second largest producer of luxury cars and manufacturer of high quality Mercedes window motors has announced recently that the first quarter profit that they obtain is more than doubled and Mercedes has helped a lot in offsetting the loss at the US Chrysler Group which is being sold.

The net income of DaimlerChrysler has increase to 1.97 billion euros ($2.67 billion), or 1.89 euros a share from 781 million euros or 77 cents explained Chief Financial Officer Bodo Uebber at a recently held conference call. Revenue also decline by 6 percent to 35.4 billion euros. The company gain from the sale of stake in the parent of Airbus SAS.

Chief Executive Officer Dieter Zetche is further attempting to reduce the risk to profit growth by finally selling Chrysler AG to Cerberus Capital Management LLC. Zetsche is expecting for more than 7 percent profit increase for this year at Mercedes, which has introduced new and expensive vehicles like the S-class sedan. DaimlerChrysler is also expecting to keep the truck unit profitable.

The shares increase by 1.84 euros or 3 percent to 63.54 euros valuing the company at 65.5 billion euros. The stock has also increased by 29 percent since February 14 when Zetsche said that “all options’ were open for Chrysler.

The Separation
DaimlerChrysler has finally announced that it would be ending its nine-year ownership of the money losing Chrysler and would be handing control to Cerberus including the $19 billion retirement liabilities for US employees. Ron Gettelfinger, the President of the United Auto Workers have welcomed the deal and promised to help in the recovery of the ailing US carmaker.

It can be remembered that Chrysler has posted a loss in the quarter amounting to 1.49 billion euros from a profit of 641 million euros. The loss includes reorganization expenses of 941 million euros. DaimlerChrysler also shared 120 million euros to assist “troubled suppliers” and added 54 million euros to cut administration and management jobs.

In addition, existing projects with Mercedes-Benz will also continue, providing opportunities to share development costs. There will also be a joint council consisting of management board representatives that be formed to discuss business projects. The deal is expected to be completed in the third quarter. The Pension as well as the health-care costs associated with Chrysler will be taken over by the new company.

Why sell Chrysler?
The merger was not working from the very beginning as a matter of fact DaimlerChrysler’s stock peaked five months after the merger and never recovered since then. Chrysler lost $680 million last year and surrendered market share to Toyota and was relying too much on the sluggish North American market. Zetsche has failed to keep Chrysler profitable after the reorganization which he himself has started.

Since 1998 Chrysler has posted annual profits of only $5 billion while its losses escalate infuriating investors further. The latest recorded loss by Chrysler marks a third descent into losses since the last time that Lee Iacocca saved the automaker from bankruptcy 25 years ago. To keep itself afloat Chrysler has reduced its workforce by 13,000 and closed one of its factories. It has also unveiled new models in the hope to offset the decline in sales last 2006.

Chrysler CEO Tom LaSorda has again vowed to get Chrysler back to profitability since now he has all the time to really focus on the recovery of the automaker without the distractions from analysts and the need to submit quarterly reports, according to Cerberus Chairman John Snow in an interview just recently.

The buck stops here
Uwe Treckman, an equity strategist at Dresdner Bank said, "Once Chrysler has been sold the cash-flow to sales-ratio will improve significantly."

The Mercedes Car Group will also implement a profit recovery plan that will include Smart, Mercedes-Benz and Maybach brands especially now that Chrysler will finally separate from them. The growing demand for heavy trucks in Europe and Asia are also helping to offset the loss Chrysler. Mercedes-Benz earnings before interest and tax were 792 million euros in the quarter from a loss of 735 million euros a year earlier.

For the first quarter, Mercedes-Benz Car Group sales declined by 2.8 percent trailing behind larger rivals like the Bayerische Motoren Werke AG and Volkswagen AG’s Audi luxury car business. Despite the decline, Mercedes-Benz is still able to come up with remarkable sales figures for its most expensive vehicles like the S-Class full-sized sedan and the GL-Class large sport utility vehicle which has given the brand more profit compared to its other models.