Daimler-Chrysler Merger*

Abstract:

The case 'Daimler-Chrysler Merger - A Cultural Mismatch' gives an overview of the merger between Daimler-Benz of Germany and Chrysler Corp. of the US. The case focuses on the various problems faced by the merged entity. It also explores the reasons for DCX's failure to realize the synergies identified prior to the merger. It examines the different culture and management styles of the companies that were primarily responsible for this failure.

The case is intended for MBA/PGDBM level students as part of their Business Strategy curriculum. From the case, students are expected to understand why the Daimler-Chrysler merger failed to realize the synergies identified prior to the merger. Students are also expected to identify the issues that should be addressed for making a cross-cultural merger successful.

Issues: » Cross-cultural Merger

Questions for Discussion:

1. Mergers and acquisitions take place to realize the synergies between the two or more companies. Why do you think the Daimler-Chrysler merger failed to realize the synergies that were expected from the merger?
2. Many a cross-cultural merger has failed because proper attention was not given to the difference in cultures between the two companies. What issues should be addressed to make cross-cultural merger a success?
3. Very often companies involved in a merger claim it to be a merger of equals but this is not the case always. 'The Daimler-Chrysler deal was never expected to be a merger of equals.' Comment.

Key words:
Daimler-Chrysler Merger - A Cultural Mismatch, merger, Daimler-Benz, Germany , Chrysler Corp., US, DCX, synergies, culture, management styles, Business Strategy

*Note : This case is a simplified version of a longer case study, and is intended for learners for whom English is a foreign language. The longer version of this case study (BSTR009) is available at: http://www.icmrindia.org/casestudies/catalogue/Business%20Strategy2/BSTR009.htm