Daimler : Chrysler like Mercedes To Us

FRANKFURT, July 27, 2003; Reuters reported that German auto giant DaimlerChrysler AG remains committed to its ailing U.S. Chrysler unit and has no intention of selling it, a company board member told a German newspaper.

"Chrysler belongs to us, just like Mercedes-Benz," DaimlerChrysler board member Ruediger Grube told Die Welt newspaper, according to an advance copy of an article to be published on Monday.

"The strategy that DaimlerChrysler has been following since the 1998 merger needs time, because we are dependent on the product cycles in the auto industry," Grube was quoted as saying.

The world's fifth-biggest carmaker said last week its core profits sank by nearly two thirds in the second quarter, hit by losses of 948 million euros ($1.1 billion) at Chrysler.

Chrysler's woes have fuelled questions about the strategic logic of its 1998 merger with Daimler-Benz, since when the group's stock has lost nearly three quarters of its value.

Grube also said DaimlerChrysler was confident of sealing a planned trucks joint venture with Korean manufacturer Hyundai Motor (KSE:05380.KS - News), with union negotiations the final hurdle.

DaimlerChrysler planned to form a 400-million-euro joint venture in the first half of 2003 with Hyundai, South Korea's top automaker, but tough labour demands have been delaying the deal