Reithofer is fearful of the impact a tie-up with Daimler might have on the BMW brand itself. "There are clear limits. The BMW brand, which one study has valued at $24 billion, must not be diluted or the brand identity damaged," he told the Frankfurter Allgemeine Zeitung, according to a Reuters report.
Zetsche did recognize that there are some areas that will have to remain completely separate, however, though he wouldn't put a name to those off-limits topics, reports Automotive News Europe. "In general I only see a few areas where working together is in principle out of the question," said Zetsche last week. Still, he's willing to work around those rough spots to get the benefits of a partnership.
"It's clear that we are two independent companies whose success in the market depends of the strength of our brands, so brand integrity is a cardinal imperative," Zetsche said. "This has to be considered at all times but it is not something that would prevent broad cooperation."
He definitely has a point, from a purely analytical point of view. Both BMW and Mercedes produce very similar vehicles in the same segment of the marketplace, in locations geographically close to each other. Pooling resources - which they've already done a bit of - and leveraging the strength of economies scale could show huge savings for both companies.
Joining forces to make cheaper vehicles, while maintaining completely independent brand identities, could also help the two luxury superpowers make their entry into the high-volume emerging Asian markets, which could potentially become the largest luxury sector in the world.
Teaming with BMW would also make both companies more able to compete with the likes of Toyota, which has rocketed to pre-eminence in the industry in recent years, and the Volkswagen Group, especially Audi, which has recently overtaken both BMW and Mercedes in Germany and is set to do the same in all of Europe by next year.
On the flip side, the Quandt family has already put the kibosh on a proposed 7% stock swap between BMW and Daimler, so there are hurdles yet to clear before and comprehensive alignment is accomplished, even beyond the fears of Norbert Reithofer.