Daimlerchrysler

DaimlerChrysler: “A New Kind of Car Company”

Table of Contents

Introduction 2

Corporate Governance: Co-determination 2

Multinational DaimlerChrysler 5

Globalization Glitches 6

Consumerism 9

Reference List 13

Daimler-Benz AG and Chrysler Corporation shocked the world they announced a merger of both companies in what would be considered one of the most significant industrial mergers in history. The merger created a transnational car company that fused the heritages of two legendary companies that were well versed in the traditional car business. The new company ventured onto un-chartered ground and created “a new kind of car company” (The Economist, 1998) in the process. DaimlerChrysler’s merger exemplifies the future of the automotive industry and the travails of globalization.

Corporate Governance? Co-determination

Daimler-Benz AG and Chrysler Corporation were known respectively by their corporate heritage. Both companies were consequently sensitive to the ever-increasing importance of ethical corporate governance. One of the important concessions made by the Chrysler Corporation was that the new corporation be established as a German Akttiengesellschaft (AG) for tax reasons. Therefore, DaimlerChrysler’s corporate governance had to be one of co-determination as prescribed by German law. The co-determination form of corporate governance was quite unique to the Chrysler management and it provided an additional level of oversight.

DaimlerChrysler’s corporate governance structure is determined by the German Corporate Governance Code, German Stock Corporation Act, and the German Co-determination Act. The three German laws work together to ensure that German corporate entities (AG) provide prudent management and oversight.(DaimlerChrysler, 2006)

The company’s management structure is established as a typical German stock corporation. The General Shareholders’ Meeting,...