DaimlerChrysler is reshaping truck unit

BERLIN -- DaimlerChrysler said Monday it will step up parts- sharing and centralize purchasing and development at its truck business, seeking to squeeze more profit from operations that span three continents.

The company is shaking up its truck unit, which includes Freightliner in the United States and Daimler-Benz trucks in Europe, after buying stakes last year in commercial vehicles businesses spun off by Mitsubishi of Japan and South Korea's Hyundai.

Standardizing major components including engines, transmissions and axles will allow the company to save "around two-thirds of the material costs of a truck," the company said in a prepared statement. "Chassis and cab modules also offer promising prospects."

It gave no figures or timetable for savings under the plan, which takes effect Jan. 1. Nor did it say when the first centrally designed trucks will hit markets.

The company said that no layoffs or job reductions were involved. DaimlerChrysler stock was up 2.4 percent in afternoon trading on the Frankfurt exchange at $35.14.

"Global networking will allow the best ideas and concepts to prevail," said Eckhard Cordes, the head of the German-U.S. firm's commercial vehicles division.

The move is just the latest in a troubled drive to create a global vehicle giant that included the 1998 merger of Daimler-Benz and Chrysler and the purchase of U.S. truck makers Western Star and Detroit Diesel.

While the ongoing struggle to return its U.S. auto division to profit has received most attention, DaimlerChrysler's management also has forced through restructuring at the sprawling truck business.

Since 2001, the company has shuttered several plants and laid off hundreds of workers at Freightliner in order to cut costs and adjust to a slump in demand in North America.

The commercial vehicles division, which also includes buses, vans and off-road vehicles, returned to an operating profit of $16 million in the first quarter after a loss in 2002.

As it pushes into the fast-growing Asian market, DaimlerChrysler said it would now turn more of its attention to wringing savings out of sales that stagnated last year.

"The objective is to make even more effective use of existing synergy potential," it said, adding that the changes will also allow closer future cooperation with Mitsubishi's Fuso division "and possibly other partners in Asia."

Under the plan, truck development, which is currently split between DaimlerChrysler's regional truck units, would be managed by a team headed by Gerald Weber, until now chief of the group's Powersystems components business. The new unit will also be in charge of group-wide procurement and production planning.

DaimlerChrysler said it would end the supply of parts to third parties and assign components plants to its regional manufacturing operations.

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