Posted on: Tuesday, June 12, 2001

Taiwan carmaker, Chrysler in talks

FRANKFURT, Germany — Taiwan's largest automaker is in talks with Germany's DaimlerChrysler AG about a joint venture to make trucks for China, a spokesman for the Taiwanese company said yesterday.

China Motor spokesman Chang Shih-ho said his company was in talks with DaimlerChrysler that could lead to sharing technology or setting up a new company.

But DaimlerChrysler spokesman Othmar Stein would neither confirm or deny that it is negotiating with China Motor Corp., even though the Stuttgart-based company has targeted expansion in Asia and is expected to reach a commercial vehicle alliance with South Korea's Hyundai Motor Co.

A report in the Commercial Times of Taiwan valued a potential deal between DaimlerChrysler and China Motor at $50 million, and said it would give the German auto giant better access to the Chinese market.

DaimlerChrysler holds a 34 percent stake in Japan's Mitsubishi Motors Corp., which controls 15 percent of China Motor and is currently the company's main technology partner.

Meanwhile, Stein said DaimlerChrysler wasn't ruling out more job cuts at Freightliner, its struggling U.S. truck division.

Saying "everything is on the table," Stein declined to give any details.

Freightliner is expected to record an operating loss of up to $500 million this year, and Freightliner already has cut 1,000 jobs.

DaimlerChrysler installed German executive Rainer Schmueckle to head Freightliner last month as part of the turnaround push, replacing James Hebe.