Hey folks,
Just found this at ABCNEWS, one of the headline buisness/tech news
lines. Time for us to start applying the pressure...
Far from a 'Merger of Equals'
— It was supposed to be a perfect union of carmakers.
When the two companies merged in 1998, Daimler Chairman Juergen
Schrempp promised a "merger of equals." But it wasn't long before
Chrysler executives complained the bullheaded Germans wouldn't listen
to the Americans.
"We don't demand things of people; we seek people's cooperation,"
says Gerald Meyers, former chairman of American Motors and now a
professor at the University of Michigan business school. "These two
cultures were therefore bound to collide."
And collide they did.
Americans Feel Deceived
>From the beginning, the high command in Stuttgart issued orders to
Detroit about everything from where the headquarters would be located
(Germany) to what kind of business cards would be used.
The relationship began to fall apart quickly. Since the merger, the
company has lost nearly half its value. Somebody had to go, and it
was the Americans. Daimler eventually sent in a German management
team.
Schremp's promise of a "merger of equals" had been fiction, and he
even admits as much. He told the Financial Times that if he had been
honest with the Americans about German dominance before the merger,
they never would have made a deal.
So what was the reaction at Chrysler?
"One of people who'd been deceived," says Meyers. "People who'd been
hoodwinked. This wasn't just a small, a small decision. This was just
plain dishonest."
The two cultures had never been compatible. Take the Daimler annual
meeting, where stockholders are fed sausages and dumplings. In
Germany, there's more attention paid to wining and dining the
shareholders than to giving them precise information.
That's the reason Kirk Kerkorian, Chrysler's largest shareholder,
sued Daimler for $9 billion, charging fraud.
"Apparently in Germany, one can say pretty much whatever one wants to
the shareholders of a company," says Terry Christensen, Kerkorian's
lawyer. "Here in the United States, what you say to the shareholders
has to be true."
Dejected Employees
All of this has demoralized Chrysler's workers.
"Most of them are disgusted and frustrated because they seem like
they have been shafted," says one.
The rank and file now expects big layoffs, and they worry the company
will be sold. Schrempp insists that isn't true, but few of the
Americans he has dealt with are willing to take him at his word a
second time.
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