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Can Chrysler and Mercedes Finally Fall in Love?

Wednesday, 14 Feb 2007 | 10:12 AM ET

Like a third-grade boy forced to hand out Valentine's Day cards to the little girls in his class he would rather not acknowledge, Chrysler and Mercedes are going to see if they can finally get together. My opinion: It won't work unless both the Americans and Germans change their attitudes.

See, there's not a whole lotta love between these two companies. Sure, they've been under the DaimlerChrysler umbrella for nine years, but they've never really worked together. Mainly because there's not enough co-operation/trust/need for each other. Many Chrysler employees have never gotten past their feeling that Daimler's a German-lead company with Chrysler as just one more division. Mercedes executives have been reluctant to share the secrets of their success for fear it would damage their luxury brand.

Well, CEO Dieter Zetsche wants to change that – and it's about time. Zetsche briefly turned around Chrysler seven years ago when he took over the American company. Under him, Chrysler executives in Michigan learned they CAN trust their German co-workers. And Daimler investors in Europe saw that Chrysler, if run properly, can be a profitable part of the company. Remember, just a few years ago, Chrysler carried Daimler when Mercedes was struggling.

Zetsche wants to more fully integrate the two companies. So the M Class and Jeep Grand Cherokee will share more inner workings, and other models will do the same. If done properly, it could save Daimler billions of dollars while raising the quality of Chrysler vehicles. However, and this is a huge one, this will only work if the two companies truly start to work together.

Chrysler execs need to realize that, yes, this is primarily a German-run company and the sooner they get past feeling inferior, the better off they will be. The Germans need to realize that working to make Chrysler better is a huge opportunity in the world's largest auto market (the U.S.). One thing is sure, if they blow it this time, the lack of love could turn in to a messy and costly divorce down the road.

Questions? Comments? BehindTheWheel@cnbc.com

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  • Phil LeBeau is a CNBC auto and airline industry reporter based in the Chicago bureau and editor of the Behind the Wheel section on CNBC.com.

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