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DaimlerChrysler Lost Nearly $30 billion On Chrysler. So Why Do Global Managers Think It Is Innovative?

Posted by: Bruce Nussbaum on May 14, 2007

Daimler Paid $36 billion to buy Chrysler and appears to have sold it to Cerberus, a huge private equity firm, for $7 billion. That’s a loss of $29 billion. Yet global senior managers ranked DaimlerChrysler No. 30 on the recent BW/BCG survey of The World’s Most Innovative Companies. That’s actually up from No. 31 in 2006.So what’s up with that?

Here are the raw comments from the survey. You will see that nearly all refer to the design and innovation associated with Mercedes Benz, not Chrysler. It’s innovation in diesel engines and the Smart car that give Daimler its halo.

Here they are:

“Because it can be the most innovative company in automotive sector

New car designs

innovative styling, the only company in the industry that does not make the majority of their products look like everone else’s products with different chrome.

Have great new ideas, just no way to get someone with the stomes to do it.


Car features, Design changes they are constantly pushing the envelope on technology for automotives and safety

First to bring new technology to Market. Most of the more sophisticated options on our cars have originated on a Mercedes S-class.

all of the automotive saftey innovations seen in the past 20 years have appeared on the mercedes S class first

stylish new vehicles - breath of fresh air for a stale US car business

Innovative and affordable vehicles

Most inovative product unlike any previous designs

Come up with brand new ideas - first to come up with a next-generation Diesel motor etc. Others then copy…

They never stop inovating, particularly with stylish designs and safety technology.

Best cars

They continue to invest and reap the benefits in automotive through features and model types

Taken the initiative to find a niche in the market that suits the ever growing environmental lobby by making car transportation
socially acceptable

A car company that registers hundreds of patents with each new model.

Quickest turnaround in industry for new products.

Product design advancements

With SmartCar changed European car market

Found the way to survive after a huge merge and combined technology with design.

Excellent technology integration and performance strategy

Design and niche vehicles.”

Most mergers and acquisitions fail. This one has failed in spectacular fashion. Measured by the comments of global managers, it makes sense for Daimler to return to its core and its roots. Whether Cerberus can turn around Chrysler using its standard private equity techniques of cutting costs is another question.

Reader Comments

James Rohrig

May 15, 2007 2:14 PM

RE: Comment on Chrysler sale:

I could not have said it better!

Post a comment



Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.

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