With 2), the "investor" is anyone who owns stock and has nothing to do
with where the company is located, so obviously the way to ensure that
"profits stay in the US" is for everyone to buy MB/Chrysler stock. That
provides control of the MB/Chrysler board (i.e. the ability to elect
directors) and thus the direction of the company.
Since the trend is to move production to areas of lower total cost
(labour, transportation, taxes/duty) its doubtful that there is going to
be a sudden "shift" of fixed asset investment to Germany for cars sold
in the domestic market. MB already builds their new "US vehicle" (the
M320) in the US. If the new company succeeds in opening up the European
and far east markets, then I'd expect that assembly plants would be
built "in country" there for the mainstream models, like GM and Ford
have already done.
Craig
> -----Original Message-----
> From: Merullo [SMTP:Merullo@ix.netcom.com]
> Sent: Thursday, September 24, 1998 10:29 AM
> To: dakota-truck@buffnet.net
> Subject: DML: Re: Damn! Anyone seen those "profits"? I think they
> left the country!
>
> >
> >1) They get invested by the company to do something (i.e. build a
> plant,
> >upgrade facilities, design new models, etc.). This activity is
> "country
> >independent" in the sense that it doesn't matter where the company is
> >headquartered, the country that benefits is the one where the work is
> >being done.
> >
> >2) They get returned to the shareholders in the form of dividends.
> Again
> >its country independent, depending on where the investor is located
>
> Right, "depending on where the investor is located". The investor is
> located in Stuttgart (excuse spelling).
> >
> >Sooo, just because a company is "foreign" owned, it doesn't mean that
> >the benefits from the profits are going to leave the country where
> the
> >work is done. The converse of that is that just because a company is
>
> That's true, but the likelihood of a larger chunk of the profits
> getting
> invested far away (i.e., closer to the physical location of the
> investor)
> goes up. I dont think that anyone posting to this thread thinks that
> corporate ownership is black and white, as in the profits either go
> "here"
> or "there", partly, because the profits will not move anywhere as a
> single
> mass due to the multitude of shareholders involved.
>
> >"owned" in the USA, it doesn't mean that the investment of the
> profits
> >will necessarily take place in the USA; the "big 3" send lots of $$$s
> >out of the US, to Mexico, Canada and other places to build factories,
> >etc.
> >
>
>
> True again. But, from a corporate-statist point of view, what you are
> describing here is ok, because the profits keep coming back into the
> control
> of USA entities, who then redistribute them as they see fit. The
> worrisome
> aspect of the DaimlerChrysler case from that point of view is that,
> since
> the majority of shares belong to the German side, basically, the
> majority of
> the profits flow back to the control of the German entities involved.
>
> It may be that the USA shareholders involved are eager to fritter the
> profits away, let's say, by lending it all to the "Re-elect Boris
> Yeltsin
> 2000" campaign, while the German shareholders are wise and benevolent
> in the
> extreme, and intend to invest in carefully-examined projects all over
> the
> globe.
>
> But, to get an accurate picture of the intentions of the shareholders
> involved would at least require a hell of lot of research, and more
> likely
> is impossible. In light of which, one simply guesstimates.
>
> Only time will tell in completion.
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