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View Full Version : SMART's restructuring: roadster and ForMore axed


Bern
04-01-2005, 05:50 PM
<br><TABLE WIDTH="90%" CELLSPACING=0 CELLPADDING=0 ALIGN=CENTER><TR><TD><i>Quote &raquo;</i></TD></TR><TR><TD CLASS="quote">Smart revamp to cost Daimler up to $1.56 billion<p>Reuters / April 01, 2005<br> <br>FRANKFURT -- DaimlerChrysler will spend up to 1.2 billion euros ($1.56 billion) in 2005 to revamp its ailing Smart brand, adding to its woes just a day after announcing its biggest-ever recall for its Mercedes brand. <p>"The substantial expenses in connection with the new Smart business model will impact DaimlerChrysler's earnings forecast for 2005," the company said in a statement on Friday. <p>Daimler reiterated it expects a slightly higher operating profit this year compared to the last, but only when excluding the one-off restructuring charge for the loss-making marque, and said it was targeting break-even for Smart in 2007. <p>The announcement comes on the heels of Thursday's recall of 1.3 million Mercedes-Benz vehicles worldwide, including its E-class sedan and brand new CLS four-door coupe, signaling just how dire the situation is at Daimler's flagship division. <p>In the fourth quarter of last year, operating profit at the Mercedes Car Group, Daimler's former jewel, comprising the Mercedes, Smart and Maybach brands, plunged 97 percent to just 20 million euros. <p>"Key component of the new (Smart) business model is a restructuring program with which earnings are to be increased by some 600 million euros in the year 2007," the carmaker continued, saying it aimed to lower fixed costs at Smart by around 30 percent within the next two years -- in part through "significant" reductions in the workforce. <p>Robert Heberger of Munich-based bank Merck Finck downgraded shares in Daimler to "sell" from "hold" on Friday on account of the higher-than-expected restructuring charges and the recall. <p>Citigroup, meanwhile, said the plan fell short of hopes for a more radical approach. <p>"Investors hoping for some new thinking will be disappointed that the company appears determined to 'grow its way' out of trouble at the Smart unit." <p><B>ONLY TWO MODELS LEFT <p>As part of the rescue plan, Smart will discontinue production of its roadster model at the end of 2005 and will discontinue plans to build the Smart ForMore compact off-roader. <p>This leaves just the original microcar ForTwo and its new ForFour subcompact in the brand's model range. </B><br>"The new product concept calls for the intensified development of the successor to the Smart ForTwo, including fulfilling the requirements for the U.S. market," it said, adding that the next generation three-cylinder petrol engine would also be available for other carmakers to use. <p>The cooperation with Mitsubishi Motors on the production of its Smart ForFour at the Japanese carmaker's plant in the Netherlands would continue, but measures would be taken to ensure the model will break even in the future, it said. <p>The brand will lose more independence as key areas of development, sales, purchasing, after-sales and service would be integrated into Mercedes-Benz to generate greater cost savings. A quarter more Smart outlets will also be opened within the showrooms of existing Mercedes-Benz dealerships. <p>Daimler has limped from one bailout plan to the next in recent years, first trying to restructure U.S.-arm Chrysler, then fix alliance partner Mitsubishi, only to find that its steady workhorse Mercedes finally began to crumble from neglect. <p>CSFB's Harald Hendrikse said the massive recall of Mercedes-Benz cars ran counter to the brand's claims that new vehicles leaving the factories enjoyed the highest quality in its history. <p>"It is surprising that the product launch of the CLS went ahead in (late) 2004 when it was being manufactured using components that had already been failing on the E class," he told clients in a note on Friday.<br></TD></TR></TABLE>

Hornbag
04-01-2005, 06:17 PM
NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!<p>NOT THE ROADSTER!!!! :(

Roadster44
04-01-2005, 06:20 PM
Uh oh I'm being phased out. Well Roadster has never done all that well and it was somewhat expensive. Why have a vehicle that doesn't sell well. <p>I mean it makes sense to have it, but Smart didn't have resources to spend of purpose making it more competitive. Let them stick to what works, what sells and what people know, and then expand. You have to crawl before you can walk type a deal.

Naga Royal Guard
04-01-2005, 08:34 PM
good riddance

zwei Biere bitte
04-01-2005, 09:45 PM
All DCX had to do was wait for a profit... Car companies aren't very good short term wise :( <p>I actually liked the Roadster and Coupe. I thought the BRABUS version was tight, but that's just me <IMG NAME="icon" SRC="http://www.germancarfans.com/images/forums/banana.gif" BORDER="0">

bastis
04-02-2005, 03:55 AM
<TABLE WIDTH="90%" CELLSPACING=0 CELLPADDING=0 ALIGN=CENTER><TR><TD><i>Quote, originally posted by <b>Roadster44</b> &raquo;</i></TD></TR><TR><TD CLASS="quote">I mean it makes sense to have it, but Smart didn't have resources to spend of purpose making it more competitive. </TD></TR></TABLE><p><br>When the Roadster was introduced, Smart was proud that it only is able to make profit because of its expensive pricing.<p>The result is that Smart sells hardly no cars.<p>I think if it is cheaper (about 25 %) it could be very succesfull.<p>The Roadster is not very fast (82 bhp, 175 km/h and 0-100 km/h in 10.9 s), but (equipped with side airbags, steering wheel gear shift and servo steering) it costs the same (or more) as Mini Cooper S (!), Mini Cooper Convertible, Madza MX-5, Opel Tigra or Peugeot 206. And these cars are faster and/or don't remember as much as Smart Roadster to a toy car.

Cozz
04-02-2005, 04:54 AM
<TABLE WIDTH="90%" CELLSPACING=0 CELLPADDING=0 ALIGN=CENTER><TR><TD><i>Quote, originally posted by <b>bastis</b> &raquo;</i></TD></TR><TR><TD CLASS="quote"><p><br>When the Roadster was introduced, Smart was proud that it only is able to make profit because of its expensive pricing.<p><b>The result is that Smart sells hardly no cars.</b><p>I think if it is cheaper (about 25 %) it could be very succesfull.<p>The Roadster is not very fast (82 bhp, 175 km/h and 0-100 km/h in 10.9 s), but (equipped with side airbags, steering wheel gear shift and servo steering) it costs the same (or more) as Mini Cooper S (!), Mini Cooper Convertible, Madza MX-5, Opel Tigra or Peugeot 206. And these cars are faster and/or don't remember as much as Smart Roadster to a toy car.</TD></TR></TABLE><p> <IMG NAME="icon" SRC="http://www.germancarfans.com/images/forums/cwm13.gif" BORDER="0"> <IMG NAME="icon" SRC="http://www.germancarfans.com/images/forums/cwm13.gif" BORDER="0"> <IMG NAME="icon" SRC="http://www.germancarfans.com/images/forums/cwm13.gif" BORDER="0">

Hornbag
04-02-2005, 05:51 PM
This car was for 'looks only'. It didnt drive very well, was expensive, but boy did it looks cool. Im gona miss it very much...

skoochythatone
04-05-2005, 01:36 PM
The roadster was actually a cool car to look at, but not to drive. The little breaks between the shifting got on every drivers nerves, and it took quite some time to get used to it and do be better at the gear shifting to avoid those brakes.<p>I am hoping that Smart will recover, considering they are firing 700(!) out of 1,400(!!!) people here at the Boeblingen headquarters. I have a family member employed there, so the chances of her being fired is 50%.<p>The main problems with Smart in my eyes were the following:<p>-Wrong marketing strategy from the beginning. What might have helped in the beginning to promote the new brand(dealerships with nice architectical features, such as the tower and only one model in their range) drove away customers in the long run. Who wants to go to a dealership to only look at one single model?<br>-The market has changed: in the beginning people were willing to spend over 10,000EUR for a two seater which driving abilities were not the best and the space inside wasnt enough. But with new life style cars coming along(Mini Cooper) people realized they might aswell add a little more money and get more car out of it.<br>-Timeline of new models: the new models(roadster and forfour) might have been attractive, but the time between their releases was too short. The money used to promote both of them couldve been spend in a lot better ways to help the company make profit(maybe).