DaimlerChrysler's Smart Brand Stays the Executioner's Axe

Other parts of the plan include the reworking of smart's sales, after-sales and servicing sectors. While these 'arms' don't hold

Things are starting to look up for smart, but the diminutive brand is not quite in the clear yet. (Photo: Shawn Pisio, American Auto Press)

the same glamor as the R&D or styling departments, they still play a critical role in turning smart around, from a financial black hole into a breadwinner. DaimlerChrysler aims to integrate these areas into the Mercedes-Benz infrastructure, which it claims will cut the company's costs by around 30 percent within a two year time period. DC also claims that by grouping these sectors in with Benz, it will improve productivity significantly. At the same time, smart will expand its existing retail facilities by 25 percent by setting up stores within Mercedes-Benz dealerships, though some job cuts are expected.

For the time being, it seems that DaimlerChrysler will help keep smart's head above water, despite advice to kill the brand from major banks and the discretion from the board of directors. While the plan should get the go-ahead, there's one fact which stands in the way; the price. The expenses involved are estimated at 1.2 billion euros (1.5 billion USD), and include write-downs on plants, equipment, and settlement of contracts with suppliers (such as those that were working on the formore). Things are starting to look up for smart, but the diminutive brand is not quite in the clear yet.