DaimlerChrysler Mitsubishi Split Will Not Affect Future Jeep Model
Date 2004/4/28 0:00:00 | Topic: Miscellaneous
|Low-end Jeep not in jeopardy|
If you've been following the auto industry over the past few days, you've no doubt heard that DaimlerChrysler has decided to no longer financially support the struggling Mitsubishi Motors. Why does this matter to Jeep lovers? Because it has been rumored that Mitsubishi was working with DaimlerChrysler on a low-end Jeep (possibly a Compass-like vehicle). Here's a snippet about the breakup from Detroit Free Press:
DaimlerChrysler AG, which owns a 37-percent stake in Mitsubishi Motors Corp., will not be bailing out its troubled Japanese affiliate, as was widely expected and reported. Yesterday, we found an article that claims that DaimlerChrysler's bailing on Mitsubishi will not affect future DaimlerChrysler products. Here's a snippet from CBS MarketWatch:
In a special meeting on Thursday, the management and supervisory boards of the Stuttgart, Germany-based automaker decided "not to participate in a capital increase" and "to cease financial support" for Mitsubishi, according to a short statement DaimlerChrysler released late Thursday.
The surprise announcement seems to throw the fate of Mitsubishi into the air.
The low-slung Chrysler Crossfire coupe is the proud child of the marriage of Daimler-Benz and Chrysler, a sleek symbol of corporate "synergy" and engineering. Check out the entire article.
To the automotive world, the Crossfire showed how important DaimlerChrysler's engineering and products are to the revival of the American automaker, once the most profitable, in its home market.
Chrysler's latest sedans, taking a cue from European rear-wheel-drive engineering, are also being well received.
Yet it's much harder for buyers in the U.S. to find a symbol as attractive or compelling from Mitsubishi Motor Co.'s stepchild relationship with DaimlerChrysler, which dates to Chrysler's first ties in the early 1970s.
That helps explain why DaimlerChrysler's stock rallied on news that it was cutting off any new funding to Mitsubishi, whose stock plunged in Tokyo.
The Dodge Avenger and Chrysler Sebring coupes borrow from Mitsubishi, and the long gone Eagle Talon was twinned with the Mitsubishi Eclipse. But those predate the 37 percent stake, worth $2 billion, that DaimlerChrysler took in Mitsubishi during 2000.
Chrysler says that the change won't alter its planned vehicles.
"The announcement last night that DaimlerChrysler would not fund further capital investment in Mitsubishi has no bearing on our current relationship with them from a product standpoint," said Chrysler spokesman David Elshoff.
Expected to continue are the development of small cars like the Chrysler Neon and new Jeep models, while a Mitsubishi truck based on the Dodge Dakota for 2005 is also in the cards. A plan to develop a four-cylinder engine with Hyundai and Mitsubishi remains unchanged.
DaimlerChrysler's relationship with Mitsubishi is more complex than a few cars and pickups. The company owns more than half of industrial transportation specialist Mitsubishi Fuso, as well.