THE BIG PITCH: Should PR for the DaimlerChrysler 'merger' have been handled differently?

CHRIS WATTS

CHRIS WATTS

CHRIS WATTS

Andrea Obston Marketing Communications

Bloomfield, CT

Daimler should have come out and said it was a takeover from the get-go In the 1990s, the public came to know Chrysler as a leader in vehicle innovation and design (see cab forward design and the prowler and PT Cruiser) but lacking in quality control (talk to any mechanic and they'll tell you build quality is poor). Had Daimler framed the take over as a deal that preserved US jobs and combined the cutting edge Chrysler design and engineering with the quality standards of Mercedes-Benz, then the public would have cheered the take over. Instead, the 'merger of equals' line has left us with the current mess.



STEVE FRANKEL

Burson-Marsteller

New York

Daimler made a big mistake in positioning the deal as a friendly, democratic marriage. From the outset, Daimler was calling all the shots and sought to shape the new company in its own image. If that was the intent, management should have moved swiftly from Day One to articulate its plan in a diplomatic and forthright manner, internally and externally. Cultural differences should have made honest communications an even higher priority. Employees, customers and shareholders want and deserve to know sooner rather than later what a takeover will mean to them. The results of this episode tangibly demonstrate the damage that can be done by following a different path.



CHUCK NEKVASIL

Lord, Sullivan & Yoder

Columbus, OH

Let's give DaimlerChrysler the benefit of the doubt: for employee relations, employee retention, community relations, dealer relations, and a host of other reasons, they probably did initially intend to make this a 'union of equals.' Like most mergers, though, DaimlerChrysler's isn't delivering the expected benefits, so the company needed to make a compelling case for a change in strategy. Any chance for this was short-circuited by an apparent failure to prep the chairman for the Financial Times interview!

Juergen Schrempp should have been ready to field the toughest questions and effectively outline the company's strategy, but he was caught off-guard.



RICHARD J. SCHINELLER

MWW Group

East Rutherford, NJ

The deal was originally announced as a 'merger of equals' that would combine the best elements of each company. It was necessary to present the deal as a merger because, with over 90% of Daimler shareholders voting to approve the deal, Daimler would be able to give the merger 'pooling of interests' status, which allowed DaimlerChrysler to avoid having to account for a goodwill charge of dollars 35 billion spread over the next 40 years.

Chrysler made the deal based on a sound appraisal of the world automotive market at the time. A downturn in the economies of Chrysler's prime markets in the US could have severely incapacitated the company and made it difficult for Chrysler to strike a deal on any terms. Due to the fiscal realities of this case, I would not have recommended communicating the deal in any other way.





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