Shareholders seek Chrysler spin-off

Posted Fri Dec 1 2006 6:44 AM by Ralph Hanson

Major shareholders in DaimlerChrysler are asking for Chrysler to be removed from the DCX group, stating that the company has basically zero value on its own and that the synergies expected from the two groups have failed to materialize. In a scathing news report from Reuters many well known investment fund managers are quoted claiming not only that nobody would buy Chrysler, but that DCX would have to pay someone to take it off their hands. Potential buyers would be turned off by the billions of dollars in unfunded pensions and healthcare costs, not to mention the sagging brand name and lack of small car expertise. Some fund managers are even suggesting a tie-up with Nissan/Renault to get access to small cars for the US market.

Chrysler has announced that it plans on decreasing the cost of new cars by around $1000 but the recent fiasco with overproduction hasn’t helped their cause. Our thoughts? The merger should never have happened.

Reader Comments

Sun Dec 3 2006 10:49 AM
jit says

This actually does make sense as Renault brand cars be badged as Dodges for the time being for the american market. Nissan can be the premium small car manufacturer. Infiniti could be resolved into Chrysler to make better Chryslers car which would be better in competing with BMW and Mercedes can kill all smaller models up to the C-class and Move upmarket to compete with Bentley.
Sun Dec 3 2006 10:50 AM
jit says

Not resolved but desolved*
Mon Dec 4 2006 9:32 PM
Tike says

In my humble, uneducated opinion, Chrysler saved Mercedes. I think shareholders have just forgotten, but without Chrysler, Mercedes would have stagnated into nothingness with its stale conservative designs. Chrysler took Mercedes and made it SEXY. I remember that time clearly: the difference in styling between the new generation (post Chrysler merger) and old were night and day.

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