Chrysler Executive Sees Closer Ties With Mercedes

CHICAGO, Feb 7, 2007; Reuters reported that DaimlerChrysler AG's U.S. head of product development said on Wednesday that the German-American carmaker's Detroit and Stuttgart-based units plan to share more components and platforms -- and one day could be building their vehicles in common plants.

Frank Klegon, Chrysler's vice president of product development, called the closer relationship "a very natural evolution of our partnership and we're going to continue down that path," said in an interview with Reuters at the Chicago Auto Show.

Although DaimlerChrysler's U.S. and German operations do not currently share any platforms the way Toyota shares platforms with its Lexus brand, they do share some components and Klegon said "from a macro perspective, there will be more."

The Chrysler 300's rear suspension design "was as much an E Class Mercedes design as anything else" and the diesel engine in the Jeep Grand Cherokee is essentially a Mercedes powerplant, he said.

DaimlerChrysler is expected to outline plans next week to restructure its operations -- a revamp that some believe could include closer integration of the German and U.S. businesses, which have remained fairly autonomous since Daimler-Benz purchased Chrysler Corp. in 1998.

That prospect is controversial in Germany, where Mercedes stalwarts worry that a closer relationship with Chrysler could risk degrading the brand.

"Both sides are very protective of their brand, particularly when you talk about Jeep and offroad prowess, and Mercedes-Benz and luxury and smooth ride," Klegon said.

But he added if engineers could develop a platform and manufacturing process that could deliver those separate brand elements in one package, "the sales and marketing guys will be comfortable standing in front" of those shared platforms.

Asked if the day could come when a single DaimlerChrysler factory might be producing Jeeps one day and Mercedes M-Class SUVs the next, Klegon said it was possible.

"Our view of the future is that ... our future products will be more similar, so in theory there could be a DaimlerChrysler plant and we make whatever we want," he said. "Whether we ever come to that, or need to do that, is a matter of capacity and some other things."