|
Smart car goes solo
|
 |
November 4, 1998: 12:43 p.m. ET
Plug pulled on micro-car venture between Mercedes and Swatch
|
LONDON (CNNfn) - German auto giant Daimler-Benz has bought out partner Swatch from their partnership to develop a new concept of urban runabout.
Daimler-Benz announced Wednesday that it has bought the remaining 19 percent in the Micro Compact Car (MCC) venture which manufactures the Smart car.
The tiny, multicolored vehicle is the result of a collaboration between Daimler-Benz and Swiss watchmaker Swatch.
"Smart hasn't developed as planned, and it's no secret the two sets of management didn't always see eye to eye", said John Lawson, analyst at Salomon Smith Barney in London.
The catalyst for Daimler's decision to take complete control of the project appears to have been the decision not to proceed with a new hybrid diesel/electric model of the Smart.
Industry analysts said Daimler can exploit the Smart brand better, following its merger with Chrysler (C).
"Daimler wants to extend the range of Smart models", according to Philipp Rosengarten at auto industry consultants DRI. He added that "the chemistry between the companies was not good, they had two different visions of the future."
Daimler quashed fears that it might be buying the Smart brand only to bury it, and erase some of the poor publicity surrounding the project.
Daimler chief executive Juergen Schrempp said "the Smart brand is now an integral member of the six passenger car brands at DaimlerChrysler (the name of the company following the merger with Chrysler)".
Daimler raised its stake in the project from 50 percent to 81 percent last year.
No financial details regarding the latest move were given.
The Smart was originally dubbed the "Swatchmobile". It was launched last month following a six-month delay over safety fears.
In Frankfurt Wednesday Daimler shares rose 2.3 marks to close at 134.5 marks. 
|
|
|
|
|
|
Daimler-Benz
Smart
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
