Daimler wants closer partnership between Mercedes-Benz and Bmw

Article by Christian Andrei, on August 29, 2010

There are talks of a BMW-Daimler partnership are coming out and confirmed today by a pronouncement from Daimler that they would like to see a joining of forces between to equals. This is nothing unusual, considering the partnership between Fiat and Chrysler. Although Daimler recognizes that there are aspects in both companies that will remain totally separate.

Daimler did not reveal which areas would be off-limits, but says that there would be just a few of these areas, and they are eager to work around these just to get to the advantages that the partnership will create.

Both companies rely on the strength of their brands for success in the market, so brand integrity will remain an essential element and be a consideration, although it won't be an obstacle to a broader partnership.

Daimler has hit something important in its analysis, since BMW and Mercedes-Benz manufacture quite similar products in basically the same segment of the industry, in geographical locations that are just neighboring. Joining their resources together, which they have already done in a more limited scale, and using the power of economies scale could provide enormous savings for both.

Consequently, combining resources while keeping brand identities intact could do much to aid the carmakers entry into the high-volume and emerging markets of Asia, which has the possibility of becoming the world's biggest luxury segment.

A merger between Daimler and BMW will put both companies in a position to rival Asian giants like Toyota, which has been propelled to prominence in recent years, and also VW Group, particularly Audi, which has surpassed BMW and Mercedes in Germany and is also expected to do in all of Europe by 2010. There are still some snags to overcome in the whole plan of striking a partnership, namely, the Quandt family has already put a stopper on a proposed 7 percent stock exchange between BMW and Daimler.

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