Daimler & BMW Partnership Talk Thread

[Tarek]

Good news,i want them to humiliate the other German giant PAG

 

[Deleted member 25]

Is the merging of the two a realistic option in the medium future ?

 

[Giannis]

I think that they are struggling to find a way to stand against VAG! Audi has tons of money behind them and they don't face any immidiate danger since VW and Porsche will support them. On the other hand nor BMW nor MB have anyone behind them, for financial support.

 

[NarutoRamen]

I think that they are struggling to find a way to stand against VAG! Audi has tons of money behind them and they don't face any immidiate danger since VW and Porsche will support them. On the other hand nor BMW nor MB have anyone behind them, for financial support.

I guess that's a good way of looking at it, but the thing is that they would never admit to this even if it were true.

 

[Giannis]

It's a matter of diplomacy! Noone would ever admit that they are in deep sith, unless they are named GM

 

[Merc1]

Something really official and concrete is bound to be announced soon, especially if 20+ percent sales drops are going to be the normal thing this year for both companies.

M

 

[NarutoRamen]

It's a matter of diplomacy! Noone would ever admit that they are in deep sith, unless they are named GM

and Chrysler

 

[EnI]

There are talks going on between Kuwait state & the Quandts about the possible "cooperation" in financial & organizational terms.

The main issue is the CEO & Board of Management question ... Kuwaitis want Daimler AG CEO (Zetche) to take over holding's management, while other board member to be named by proportional rule (50% from BMW, 50% from Daimler). While the Quandts on the other hand believe a new man should be named CEO of the Holding, while board members should be named based on competence, not company. Of course the Quandts believe BMW AG staff is better than Daimler staff.

 

[Tarek]

And here we go again,man fanatics even on that level..amazing

 

[Giannis]

There are talks going on between Kuwait state & the Quandts about the possible "cooperation" in financial & organizational terms.

The main issue is the CEO & Board of Management question ... Kuwaitis want Daimler AG CEO (Zetche) to take over holding's management, while other board member to be named by proportional rule (50% from BMW, 50% from Daimler). While the Quandts on the other hand believe a new man should be named CEO of the Holding, while board members should be named based on competence, not company. Of course the Quandts believe BMW AG staff is better than Daimler staff.

Only the Chinese are missing from this deal, but I am convinced that in a month we will be reading articles like "Chinese consortium to buy 20% of german luxury car maker"

 

[NarutoRamen]

Only the Chinese are missing from this deal, but I am convinced that in a month we will be reading articles like "Chinese consortium to buy 20% of german luxury car maker"

True...but I think they're pretty wise right now as they are spending a lot of money on their infrastructure.

 

[bmer]

BMW to Deepen Daimler Cooperation, Production Cutback​

By Chris Reiter and Laurence Frost

March 18 (Bloomberg) -- Bayerische Motoren Werke AG will expand joint parts purchasing with Daimler AG and curtail production by an additional 40,000 vehicles as the biggest maker of luxury cars seeks to cope with the global recession.

Sales will fall this year as global auto markets shrink by 10-20 percent, while a “reliable” profit forecast isn’t possible because of questions about the depth of the recession, Chief Executive Officer Norbert Reithofer said at BMW’s annual news conference today in Munich.

Carmakers in Europe are likely to build 25 percent fewer vehicles this year, the European Automobile Manufacturers Association said on March 5. BMW’s profit dropped 89 percent last year as the company spent money eliminating jobs and set aside cash in case auto buyers default on loans. Cooperation with Daimler’s Mercedes-Benz Cars unit has generated savings of as much as 15 percent on parts they buy together, BMW said.

“These guys need to do significantly more than just buying a couple of parts with Mercedes,” said Arndt Ellinghorst, a London-based analyst with Credit Suisse with an “outperform” recommendation on BMW shares. “We need major technological cooperation, a lot more than just joint purchasing.”

BMW fell as much as 53 cents, or 2.3 percent, to 22.33 euros and was down 1.4 percent as of 1:34 p.m. in Frankfurt trading. The stock has risen 4.3 percent this year, valuing the company at 14.3 billion euros ($18.7 billion).

Keeping 2012 Target

Deliveries will “pick up pace” in 2010, when the economy recovers and new models reach the market, Reithofer said. Munich-based BMW is sticking to a forecast that automaking earnings before interest and taxes will reach 8-10 percent of sales by 2012, and the company will “clearly exceed” a goal of reducing material costs by 4 billion euros by then.

BMW and Stuttgart, Germany-based Daimler, the world’s second-biggest luxury-vehicle manufacturer, are generating savings of 8-15 percent with joint purchases of items such as tires and electronic components, Herbert Diess, BMW’s purchasing chief, said at the news conference.

The number of parts is in the “double-digit” range, and any expansion would be limited to 5 percent of the 10,000 components in each carmakers’ vehicle, he said.

Full article: BMW to Expand Parts Cooperation With Daimler as Markets Shrink - Bloomberg.com

 

[Tarek]

So they are gonna co-operate but no cross ownership as the Quantds ruled out any plans for that?

 

[EnI]

Yes, since the Quandts have other plans ... Not linking BMW AG cross-linking to any other carmaker.

 

[Mr. Mercedes]

Yes, since the Quandts have other plans ... Not linking BMW AG cross-linking to any other carmaker.

Sorry Eni, please clarify your last post?

What happened to the Automotive Holding Idea?

I'm keen to see some sort of strong strategica alliance/link between Daimler and BMW.

 

[Mr Robert]

A cross-linking is not the only alternative. Joint ventures are far more common.

 

[EnI]

Sorry Eni, please clarify your last post?

What happened to the Automotive Holding Idea?

I'm keen to see some sort of strong strategica alliance/link between Daimler and BMW.

That's exactly the idea behind: a holding. A holding having shares in both: BMW & Daimler (perhaps even in Opel) ... making cooperations easier.

While the current Daimler proposal was BMW & Daimler to exchange shares in each other: meaning each company would be able to influence other company directly. The Quandts don't want that.

 

[bmer]

Daimler CEO wants broader cooperation with BMW​

Fri May 8, 2009 5:49am EDT
By Christiaan Hetzner and Hendrik Sackmann

FRANKFURT/STUTTGART (Reuters) - Daimler would like to expand plans for cooperation "as equal partners" with BMW beyond an agreement to bundle purchasing of components, Chief Executive Dieter Zetsche told Reuters.

"In general I only see a few areas where working together is in principle out of the question," Zetsche said in an interview at Daimler headquarters in Stuttgart's Untertuerkheim district.

"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. This has to be considered at all times but it is not something that would prevent broad cooperation."

While he would not say what areas were off limits, he explained that Daimler had to ensure that when its customers drive off a dealer lot, they believe they have bought a luxury car with the unique characteristics of a Mercedes.

Unlike German rival Audi or Volvo of Sweden, BMW and Mercedes share a specialization in rear-wheel-drive cars. At the same time the performance and design of their cars appeal to two largely different customer groups.

"The issues we are discussing (with BMW) have to be examined closely from the very beginning in order not to realize later halfway through that you made a mistake. That is why any results we might achieve would be that much more thorough," he said.

Zetsche refuted the credo of pure production size that has come to exemplify Sergio Marchionne's vision at Fiat, but he acknowledged that a key ingredient to success was the consistent use of modules to build Mercedes-Benz cars across segments as a method of gaining economies of scale.

"That offers the main opportunity for volume effects and then we can look at whether they can be applied jointly across company borders, which is certainly a sensible goal," he said.

Full article: Daimler CEO wants broader cooperation with BMW | Reuters

 

[PanterroR]

BMW's Reithofer wary of tighter relationship with Daimler

Fiat is trying to tie together Chrysler and GM via Opel, so perhaps the idea of a BMW-Daimler tie-up isn't the strangest corporate pairing in the works, but it is potentially one of the most contentious. Lastweek Daimler CEO Dieter Zetsche said he'd like to see a partnership of equals between the two companies, and this week BMW CEO Norbert Reithofer has expressed trepidation about the idea.

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.


Source: BMW's Reithofer wary of tighter relationship with Daimler - [BMW-Daimler alliance] - MotorAuthority - Car news, reviews, spy shots

 

[EnI]

BMW, Daimler to expand purchasing tie-up


Sat Jul 25, 2009 11:57am EDT


FRANKFURT (Reuters) - German carmakers BMW and Daimler will expand their cooperation in purchasing automotive components, a BMW board member told German magazine WirtschaftsWoche on Saturday.
Up to 10 percent of a car's components can be purchased jointly by the two companies without damaging their brand names, Herbert Diess said.
Mechanical systems, wheels and tires are some of the items the two are buying jointly, he added.
Diess said BMW is expected to achieve its goal to save 4 billion euros ($5.68 billion) in purchasing expenditures by 2012 and might even exceed this amount.