Chrysler/Benz Deal Keeps Looking Better

The estimated US$43 billion merger of Chrysler Corp. and Germany's Daimler-Benz AG promises to produce greater cost savings than originally estimated. Daimler-Benz chairman Jürgen Schrempp now terms original estimates "rather conservative," while industry analysts who initially calculated the savings at $1.4 billion during the first year and about $3 billion annually over the next five years now are predicting figures could be twice as high.

Purchasing and logistics efficiencies, sales distribution synergies, and joint product development are expected to be the major savings drivers, according to Schrempp. Chrysler and Daimler-Benz shareholders are expected to vote for the merger, which has European Union approval, on Sept. 18.

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