* DaimlerChrysler to hold 43% in the Commercial Vehicle business of
Mitsubishi Motors, plus 50% in Hyundai Motors' Commercial Vehicle
business
* More direct access to the largest and fastest growing commercial
vehicle market in the world.
* Considerable potential for synergies through joint development,
commonality of parts and major components
STUTTGART, Germany and AUBURN HILLS, Mich., Sept. 20 /PRNewswire/ --
The Supervisory Board of DaimlerChrysler AG, meeting in Auburn Hills, agreed
that the company's alliance with Mitsubishi Motors Corporation (MMC) as well
as its partnership with Hyundai Motor Company (HMC) in the area of commercial
vehicles should be further strengthened. DaimlerChrysler will purchase 43 %
of the spun-off commercial vehicle business of Mitsubishi Motors (purchase
price approximately 760 million Euros). At the same time, the Board of
Management is authorized to exercise its option, as contractually agreed with
Hyundai Motor, to purchase a 50 % share of the spun-off commercial vehicle
business of HMC by the end of the year (purchase price around 400 million
Euros). The MMC Board of Directors approved the DaimlerChrysler share
increase in Fuso at its meeting on September 20th, 2002.
(Logo: http://www.newscom.com/cgi-bin/prnh/20020212/DCXLOGO )
DaimlerChrysler currently anticipates that its 43 % share participation in
the Mitsubishi commercial vehicle business will be completed at the beginning
of 2003. The exercising of its call option in the Hyundai commercial vehicles
division will be transacted by year end 2002.
Asia is the fastest growing market for commercial vehicles in the world,
and is projected to account for over 50 % of the world market during the next
decade. Currently, some 43 % of all commercial vehicles are sold in this
region. The proposed investments will ensure that DaimlerChrysler's
Commercial Vehicles Division can leverage the potential growth of these key
Asian markets for further growth.
"We already laid the foundation for a leading position in Asia in the year
2000 with our MMC alliance and our partnership with HMC. Our joint ventures
with such strong and profitable partners will enable us to enhance our
position as the world's leading commercial vehicle manufacturer," (2001:
493,000 new vehicles manufactured; world market share 20 %) said Dr. Eckhard
Cordes, member of Board of Management of DaimlerChrysler AG responsible for
the Commercial Vehicle Division. "By expanding in Asia, we can implement our
strategy of 'turning scale into profit' -- in other words reaping the benefits
of economies of scale -- even more rigorously," Dr. Cordes added. "We will
thoroughly exploit the advantages we gain from our high unit sales figures and
our global presence, where possible by:
* collaborating closely in the field of development
* using shared components and major assemblies
* and utilizing common parts world-wide."
"Our investments in the commercial vehicle activities of MMC and HMC are
therefore an integral part of our global business strategy," commented
Dr. Cordes.
Mitsubishi Fuso Truck and Bus Corporation (MFTBC)
The agreement with Mitsubishi Motors assumes MMC's demerger of its current
commercial vehicle division by early 2003 to form a separate company, which
will be called "Mitsubishi Fuso Truck and Bus Corporation" (MFTBC).
DaimlerChrysler will purchase 43 % of the shares in MFTBC for 760 million
Euros. The Mitsubishi Group companies (primarily Mitsubishi Corporation,
Mitsubishi Heavy Industries, Bank of Tokyo Mitsubishi etc.) will acquire a
total of 15 % of the shares for around 265 million Euros. The remaining 42 %
will be held by MMC.
"We have thoroughly analyzed the business and technological practices of
MFTBC and as a result we have reached the decision to take a direct share in
the spun-off company. With a market share of 30 %, MFTBC is the market leader
in Japan and holds a strong position in the key markets of South-East Asia.
DaimlerChrysler's direct investment in MFTBC will provide the necessary basis
for closer cooperation on both business and technological matters with the
Commercial Vehicle Division of DaimlerChrysler. This new structure and
alliance will help accelerate the identification and implementation of
potential synergies," added Cordes.
MFTBC is headed up by a Board of Directors comprising nine members.
DaimlerChrysler will nominate four members, to include the President and CEO
of the new company, Wilfried Porth. Chairman of the Board will be Takashi
Usami, currently head of MMC's commercial vehicles business. This transaction
is subject to the approval of an Extraordinary General Meeting of MMC planned
for the end of November.
Daimler Hyundai Truck Corporation
The Supervisory Board has also authorized the DaimlerChrysler Board of
Management to exercise the option contractually agreed in June 2001 for
DaimlerChrysler to take a 50 % share in the commercial vehicle business of
HMC. DaimlerChrysler will purchase this share for around 400 million Euros.
The new venture incorporated in the previously established "Daimler Hyundai
Truck Corporation" (DHTC) -- which includes the engine joint venture -- will
also produce trucks, buses and components. DHTC will be headed up by a board
of management comprising eight members. DaimlerChrysler will be responsible
for appointing four members -- of these the Chief Operating Officer (COO) and
the Chief Financial Officer (CFO).
"The joint venture with HMC will increase our access to the important
Korean market as well as a very cost efficient production base. Again our
joint product and component concepts afford us considerable potential for
synergies," stated Cordes.
DaimlerChrysler's Commercial Vehicle Division will thus gain direct access
to a commercial vehicle producer which occupies the top position in the third
largest market in Asia. DHTC is the clear market leader by a substantial
margin, in the domestic Korean commercial vehicle sector. Additionally, both
partners are already building an engine plant together in Chonju, which will
commence production of the Mercedes-Benz 900 series in 2004.
This joint venture will also be accounted for by DaimlerChrysler using
equity method. The 10 % share that DaimlerChrysler holds in HMC remains
unchanged.
Key facts and figures -- MMC/Fuso and HMC Commercial Vehicles
Fuso
Employees 17,477
Revenues 2001 euro 5.9 bil.
Sales 2001 140,000 units, of which 50 % export;
> 3.5 t: 100,000 units
Key Products Full range of commercial vehicles with emphasis on
light duty trucks, ex. Canter
HMC Commercial Vehicles
Employees 4,900
Revenues 2001 euro 1.2 bil.
Sales 2001 42,900 units, of which 23 % export
Key Products Full range of commercial vehicles,
light, medium, heavy duty trucks and buses
This document contains forward-looking statements that reflect the current
views of DaimlerChrysler management with respect to future events. The words
anticipate, believe, estimate, expect, intend, may, plan, project and should
and similar expressions are intended to identify forward-looking statements.
Such statements are subject to risks and uncertainties, including, but not
limited to: changes in general economic and business conditions, especially an
economic downturn in Europe or North America; changes in currency exchange
rates and interest rates; introduction of competing products; lack of
acceptance of new products or services, including increased competitive
pressures on the general level of sales incentives and pricing flexibility;
inability to implement the turnaround plans for the Chrysler Group and
Freightliner promptly and successfully, especially an inability to meet
revenue enhancement, efficiency and cost reduction initiatives; the ability of
Mitsubishi Motors to implement its restructuring plan successfully; and
decline in resale prices of used vehicles. If any of these or other risks and
uncertainties occur (some of which are described under the heading Risk
Factors in DaimlerChrysler's most recent Annual Report on Form 20-F filed with
the Securities and Exchange Commission), or if the assumptions underlying any
of these statements prove incorrect, then actual results may be materially
different from those expressed or implied by such statements. DaimlerChrysler
does not intend or assume any obligation to update these forward-looking
statements. Any forward-looking statement speaks only as of the date on which
it is made. Both transactions are subject to regulatory approvals and the
negotiation of final terms and conditions.
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Internet at: http://www.media.daimlerchrysler.com
SOURCE DaimlerChrysler AG
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CONTACT:
Othmar Stein, +49-711-17-95160, or Michael
Behrens, +49-711-17-93278, both for DaimlerChrysler AG
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