Last week, Daimler-Chrysler sold its remaining 12.4 percent stake in the Japanese based company Mitsubishi Motors, establishing the demise of creating a global automotive empire.
After Daimler-Chrysler’s sale, Goldman Sachs was on the verge of becoming Mitsubishi’s largest shareholder until Monday when it sold all but 1.04 percent of its Mitsubishi stake.
Fortunately, the sale has removed one problem from the list confronting his successor Dieter Zetsche, the current head of Mercedes scheduled to take control of Daimler in January.
Daimler’s strategic problems encompass its stake in aerospace group EADS and how to fix its loss-making Smart small car brand.
Starting in 2000, Daimler invested a total of $2.9 billion in MMC to increase its stake total to 37 percent. Last year, Daimler did not bail out the Japanese company and its stake had slowly fallen to 12.43 percent.
On Friday, Rudiger Grude resigned from his position on the board of directors of Mitsubishi Motors; the company did not give any reason for Grude’s action.
The two carmakers were said to have joint ventures, such as engine development or a shared factory for Mitsubishi Colt and Smart small cars that would remain unaffected by the sale.
Spectators say the sale came at the right time for Daimler. MMC’s share price has trebled over the past six months.
This has prompted professional investors to be cautious because the share price could easily correct itself in the near future.
Questions were raised over the German-U.S. carmaker in Asia after Daimler sold its stake in South Korea’s Hyundai.
Last month in the United States, Chrysler had to recall over 300,000 cars because of a potential defect that could prevent the driver from placing the transmission in “park.”
“I have not had any problems with my Chrysler. A good thing is car companies let owners know immediately when a problem is discovered,” said Whitney Jenerette, a third year engineering student from Detroit.
In order to correct the problem, dealers will repair the transmission by installing a bracket.
Despite the problems Daimler-Chrysler has had in the past, it will have a new leader that will unify all car companies subsidiaries.
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