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DaimlerChrysler Bolsters Presence in Asia
DaimlerChrysler on Monday forged a strategic alliance with South Korea's leading Hyundai Motor Co to bolster the German-US auto group's presence in Asia's fast-growing markets.
"Hyundai Motor Company is an ideal partner to expand DaimlerChrysler's growing presence in Asia," DaimlerChrysler chairman Juergen Schrempp said in a joint news conference Monday with Hyundai Motor chairman Chung Mong Koo in Seoul.
Schrempp said: "Hyundai is successful, profitable and by far the strongest player in the Korean automotive market. It has an excellent distribution network throughout Asia and in particular the fast-growing ASEAN (Association of Southeast Asian Nations) countries."
Under the agreement, DaimlerChrysler will acquire a 10 percent stake in Hyundai Motor for 480 billion won (428 million dollars).
The deal would give DaimlerChrysler much easier access to the emerging Asian markets with the right brands and products, said Eckhard Cordes, a member of the German-US firm's management board.
The two companies said "diverse projects" would follow as they agreed to form a consortium to jointly bid for insolvent Daewoo Motor Co. and develop a "world car."
DaimlerChrysler's deal with Hyundai marked its second Asian alliance in recent months, following its acquisition in March of a 34 percent stake in Japan's Mitsubishi Motors Corp.
Mitsubishi retains a 4.8 percent stake in Hyundai Motor, which now controls 70 percent of South Korea's auto market.
The German-US giant and Hyundai formed a consortium to jointly take over Daewoo Motor, formerly South Korea's second largest auto maker with an annual production capacity of 2 million units.
"Korea is a market with huge potential and the low cost position of Korea would give us a better access to the world market. We are confident of the future success of this alliance," Cordes said.
Asia is a market for any automaker who aspires to attain global leadership but non-Asian companies find it hard to gain a foothold in the market, he said. DaimlerChrysler now controls 8 percent of the Asian market.
But he said the German-US automaker has "no intention to fully take over Hyundai Motor even in the long-term range."
DaimlerChrysler and Hyundai also said they would jointly cooperate with Mitsubishi to make a "world car" targeting global markets.
The three firms' efforts to develop a platform to produce a competitive "world car" have "reached to a significant level," they said.
In another tie-up, DaimlerChrysler and Hyundai Motor will form a joint venture, one of the world's largest commercial vehicle plants, to produce large buses and 2.5-tonne trucks.
DaimlerChrysler will take a 50 percent stake in the joint venture, which will run Hyundai's commercial vehicle plant with an annual capacity of 100,000 units, they said.
Hyundai Motor president Lee Kye-An earlier said the "world car" will be a vehicle with a 1.0-1.5 liter engine, based on a Hyundai model.
The two companies agreed to develop platforms and technology for small passenger cars and also a wide range of other vehicles.
They will also share global networks supplying auto parts to reduce costs and exchange top managers to enable Hyundai to learn advanced skills.
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