If anyone ever doubted that DaimlerChrysler is now a German-controlled corporation, the recent demise of the Plymouth brand provides incontrovertible proof Plymouth, sold only in the United States, was the inexpensive core brand of Detroit’s Chrysler Corporation, America’s third-largest automaker in the post-World War II era. Introduced on the eve of the Great Depression in 1928, PK mouth was a crucial part of founder Walter P. Chrysler’s plan to offer economy cars to compete against Henry Ford’s Model A and General Motors’ Chevrolet brand. The plan succeeded: Within three years, Plymouth was the third-best selling ear in the nation.
“This was an emotional decision,” Jim Holden, the newly installed president of Daimler’s North American operations, explained at a Las Vegas trade show on November 4. “Plymouth will always be an important part of our heritage.” (Left unsaid was the fact that Plymouth allowed the struggling Chrysler to survive the Great Depression.) That heritage has been disappearing since Stuttgart-based Daimler purchased Chrysler in mid- 1998. Announcing the deal, CEOs Juergen E. Schrempp of Daimler and Robert J. Eaton of Chrysler termed it a merger of equals. “Takeover” is a more appropriate description of what has transpired. “Co-CEO” Eaton has announced his plans to retire; management employees at Chrysler Headquarters in Auburn Hills, Michigan, are scrambling to learn German; and more than 75 percent of DaimlerChrysler’s stock is now foreign-owned. At a meeting with Wall Street analysts in August, Daimler executives displayed pictures of automotive products in the manufacturing pipeline and announced their plan to use the more expensive, upscale Chrysler brand to boost overseas sales. When one analyst noted the absence of Plymouths, Thomas Stallkamp, then president, replied, “That’s not by accident.” Within months, Stallkamp was replaced by Holden because Schrempp didn’t like his freewheeling American management style, according to a Detroit News story. Such is the “dynamic” of the new global economy.
The Wall Street Journal broke the news of Plymouth’s demise. London’s Financial Times did a better job of reporting than the New York Times, which overlooked Plymouth’s economy car heritage. Quoting Holden, the Financial Times reported, “We will be less reliant on Plymouth as a value [emphasis added] brand. It doesn’t mean I don’t like the heritage, but our reliance is less and less on Plymouth.” The New York Times dispatched the working man’s brand in a paragraph: “The company is expected to announce tomorrow that it will drop the Plymouth brand from its stable . . . ” Holden announced that Daimler will develop the better-selling Jeep, Dodge, and Chrysler brands, which, incidentally, are more expensive and provide greater profits to the firm. But a shareholder was probably closer to the truth when he wrote on an internet message board that “Plymouth failed because they [DaimlerChrysler] didn’t do anything for it.”
In 1964, Plymouth introduced the Barracuda, which became, along with the Roadrunner, one of the premier automobiles of the “muscle car” era. That same year, stock-car racer Richard Petty led a 1-2-3 Plymouth win at the NASCAR Daytona 500 in a Hemi-powered Plymouth Fury. (The Hemi was a Plymouth big-block engine.) The 1969 Roadrunner, with its 425 horsepower-V8 engine, was the third-fastest car of the era, covering the quarter-mile in 12.91 seconds (111.8 miles per hour), trailing only the 1966 Corvette and the 1966 Cobra. The 1970 Barracuda Hemi was the fourth-fastest car of all time. In the bluecollar suburb of Detroit where I have lived most of my life, teenage ownership of a “Cuda” or “Runner” was considered a rite of passage. No more. In the Al Gore era of trashing automobiles, the best Chrysler could offer were the wimpy Plymouth Breeze and Neon models. At the end of the muscle car era, Plymouth sold 766,442 units in 1973, its best year ever. In 1998, Plymouth sold less than half that amount—307,000 vehicles.
For a globalist, the ultimate test of any merger is whether or not it “creates shareholder value,” i.e., whether the “synergies” produced by the deal cause the stock price to increase. DaimlerChrysler’s stock is off 25 percent since the merger. While the percentage may appear insignificant, that represents a loss of $25 billion.
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