Week of September 27, 1999

DC SHAKES UP BOARD The latest round of sweeping changes at DaimlerChrysler has claimed Thomas Stallkamp, president of DC’s Chrysler division. Stallkamp, 53, will retire, leaving James Holden, currently the company’s executive vice president for sales and marketing, in charge of Chrysler operations. Also in the purge, DC trimmed its management board from 17 members to 14. Theodore Cunningham, formerly head of Latin American operations, will be effectively demoted to executive vice president for global sales and marketing. Head of commercial vehicles, Kurt Lauk, is gone, as is the former head of human resources, Heiner Tropitzch, who will be replaced by Guenther Fleig.

IS PLYMOUTH DEAD? DaimlerChrysler may announce the demise of the Plymouth brand as soon as next month, according to the Detroit News. The paper points to several recent signals to the brand’s demise, including the lack of new product and removal of Plymouth badges from the tailgate of the 2000 Voyager minivan. Plymouth sales have been shrinking for the past two decades, and although the brand has existed for more than 70 years, its international viability within DaimlerChrysler is seen as minimal.

HONDA GETS INSIGHT The first gas-electric hybrid to hit the ground running will be priced at less than $20,000. Honda announced last week that the Insight, its hybrid compact, will go on sale early next year and will be priced comparable to the least expensive versions of its midsize Accord sedan. Honda plans to market 4,000 of the vehicles in the United States in its first year. The Insight uses a gasoline engine and a battery pack in tandem to cut emissions and increase fuel efficiency to 70 mpg. The Insight will also be sold in Japan beginning in November and in Europe starting early next year.

FORD GOES ONLINE WITH MICROSOFT Have you driven a PC lately? With the latest business venture between goliaths Microsoft and Ford, ordering your next Ford vehicle might involve a little wheel-spinning on the World Wide Web. Last Monday, the two companies announced a partnership where new-car buyers will be able to use Microsoft’s CarPoint site to designate the color, options, and trim on new Fords. The order will be matched against dealer and factory inventories first, and sent as an order to the factory if no such car exists. Once the specs have been clicked off online, the purchaser will arrange a price and delivery details with a local dealer, thus keeping Ford in line with franchise laws that forbid carmakers to sell their vehicles directly. While Ford is taking a piece of the CarPoint business, Microsoft says it intends to bring online other manufacturers in a similar manner.

MERCURY LOSES ITS MYSTIQUE It’s the end of the assembly line for the Mystique, the second Mercury this year to go the way of the Montclair. Ford says it’s halting production of the Mystique in December, when its sister Contour sedan moves production to Mexico. The Mystique, the smallest sedan in Mercury’s lineup, means the brand is without an entry-level car — the new Focus is being reserved for Ford only.

NEW AIRBAG STANDARD BREWING? Automakers have proposed a new 25-mph front-impact test for airbags in the hopes of warding off more stringent standards they say are nearly impossible to meet without risk. The new 25-mph standard for crash tests would involve unbelted crash-test dummies; the Department of Transportation has suggested it might return to the 30-mph frontal crash with unbelted dummies to improve safety in new vehicles. Automakers say that the tougher test will force them to revert to airbag designs with faster inflation speeds and higher explosive forces that could injure children and small adults. According to data from the government, airbags were responsible for 143 deaths this decade.

BREED FILES CHAPTER 11 Breed Technologies Inc., the third-largest maker of automotive airbags, has filed for Chapter 11 protection from its creditors, citing more than $1.6 billion in debts after suffering continued losses over the past two years. Lakeland, Florida-based Breed also listed $1.32 billion in assets and $330 million in bond debt in documents filed yesterday in U.S. Bankruptcy Court in Wilmington, Delaware, Reuters reports. Though the company has shed 5,000 workers, it may be forced to sell its assets. Sweden's Autoliv AB, the largest airbag maker, said earlier this month it was negotiating to buy parts of Breed, Reuters adds.

VW BUILDS 100 MILLIONTH CAR Volkswagen AG’s sales may be in a slump, but overall it’s doing OK. Recently, the carmaker marked the production of its 100 millionth car. The first production VW Beetle rolled off the Wolfsburg, Germany, production line in 1938. "It began with my grandfather Ferdinand Porsche on January 17, 1934 when he gave the government an 'expose' on the construction of a 'People's Car,''' said VW Chairman Ferdinand Piech in a prepared statement. Of the 100 million cars, some 82 million have been VWs, 12 million Audis, 5 million Spanish-made Seats, and 2 million Czech-built Skodas.