Daimler-Chrysler Case Study

Case Study 1

Short Case study

“Cross-border Merger: Daimler-Chrysler 1998”

( Multiple sources exist on this case study, two of which are the main sources of our

information in this adapted case: "Daimler Chrysler AG's Global Strategic Challenges

in 2007" from Deresky, Helen. International Management: Managing across Borders and Cultures.

Upper Saddle River, New Jersey: Pearson Education International. 2008, and “Cross-border

Merger: Daimler-Chrysler 1998” from Olivier Meier's Management interculturel, Paris:

Dunod, 2008)

Without Daimler, Chrysler would be in liquidation, and without

Chrysler, Mercedes would be confined to a limited future of

narrowing horizons, as rivals encroached on the luxury market.

Strategic mergers may sometimes be necessary, even if they are

mighty hard to pull off.

Dieter Zetsch pulled off his reading glasses, threw the copy of The Economist on his desk,

and rubbed his eyes. Everyone thought that top executives like him always had a clear

and exciting plan for dealing with the future. The general public -- and obviously the

Economist author -- didn't get the fact that people like him (even Germans) were

specialists not in creating certain and secure futures, but it negotiating the wilds of

uncertainty. What the hell was he going to do now?

A giant had been born in 1999 when the American automobile manufacturer Chrysler

and the German Daimler merged, and today, four years later, Zetsch was responsible for

pulling it off.

The merger had been in the works since January 1998, when Jurgen Schrempp and

Robert Eaton, the CEOs of the future partners, began to see clearly the direction their

sector was taking. The automobile sector, starting in the early 1990's, had been marked

by partnerships, alliances, commercial agreements and co-branding of all sorts. At the

time, it seemed clear that by 2010 only 8 to 10 car manufactures would be big enough,

on a global level, to continue to compete in the market. Would any of...