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27 March, 2000This week brings a new outburst of cross-border activity in the rapidly changing landscape of the automotive sector.
GLOBAL: Each passing week seems to bring a new spurt of takeovers, mergers, strategic alliances in the rapidly changing global economy, particularly for the automotive sector.
This week, so far, it is the turn for deals between DaimlerChrysler and Mitsubishi, on the one hand, and Volkswagen with Scania, on the other.
On Monday, March 27, DaimlerChrysler, the German-U.S. carmaker, got the foothold it was apparently looking for in the Asian market when it paid $2.04 billion to acquire a 34 per cent share of the Japanese automotive firm Mitsubishi Motors. DaimlerChrysler will thus become the third largest auto company in the world, after General Motors and Ford Motor Company. The deal with Mitsubishi, which will complete DaimlerChrysler's strategic alliance in the world's three main auto markets of North America, Europe, and now Asia, will centre on passenger cars and light commercial vehicles. Mitsubishi will continue, however, its alliance with Volvo for its truck business.
In another cross-border alliance, also announced yesterday, Volkswagen has bought shares worth $1.6 billion in the Swedish truckmaker Scania, which will give the German company 34 per cent voting rights in Scania and 18.7 per cent of its capital. (Volvo still holds 30.6 per cent of voting rights in Scania and 45.5 per cent of its capital.) VW and Scania have worked together before through Svenska Volkswagen, a joint venture for sales and distribution in Sweden. VW is said to want a close relationship with Scania without completely taking it over, and Scania has welcomed VW as a "long-term, stable owner." Just a few weeks ago, the European Commission rejected a merger between Scania and the other Swedish truckmaker, Volvo, saying that it would have given the resultant new company a near monopoly in the Nordic truck market.
This week, so far, it is the turn for deals between DaimlerChrysler and Mitsubishi, on the one hand, and Volkswagen with Scania, on the other.
On Monday, March 27, DaimlerChrysler, the German-U.S. carmaker, got the foothold it was apparently looking for in the Asian market when it paid $2.04 billion to acquire a 34 per cent share of the Japanese automotive firm Mitsubishi Motors. DaimlerChrysler will thus become the third largest auto company in the world, after General Motors and Ford Motor Company. The deal with Mitsubishi, which will complete DaimlerChrysler's strategic alliance in the world's three main auto markets of North America, Europe, and now Asia, will centre on passenger cars and light commercial vehicles. Mitsubishi will continue, however, its alliance with Volvo for its truck business.
In another cross-border alliance, also announced yesterday, Volkswagen has bought shares worth $1.6 billion in the Swedish truckmaker Scania, which will give the German company 34 per cent voting rights in Scania and 18.7 per cent of its capital. (Volvo still holds 30.6 per cent of voting rights in Scania and 45.5 per cent of its capital.) VW and Scania have worked together before through Svenska Volkswagen, a joint venture for sales and distribution in Sweden. VW is said to want a close relationship with Scania without completely taking it over, and Scania has welcomed VW as a "long-term, stable owner." Just a few weeks ago, the European Commission rejected a merger between Scania and the other Swedish truckmaker, Volvo, saying that it would have given the resultant new company a near monopoly in the Nordic truck market.