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AutoBlog: REPORT: Chrysler files suit against Daimler, says former parent is threatening production

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Filed under: Chrysler, Mercedes-Benz


When Daimler offloaded Chrysler onto Cerberus back in 2007, the well-heeled German automaker was likely ecstatic. Considering the fact that Daimler left Chrysler without much in the way of new product, the feeling was likely mutual. While the two automakers have parted ways, Chrysler still relies on its former parent for some vital parts and as Automotive News tells it, Chrysler says that Daimler suddenly isn't in the mood to give them up.

Chrysler is reportedly suing Daimler for withholding steering columns and torque converters, saying that the shortage of vital parts is threatening the production of the Chrysler 300, Dodge Challenger and Charger, as well as the launch of the next generation Jeep Grand Cherokee. Daimler told AN that Chrysler's claims were "without merit," and at the same time, the German automaker is demanding $78 million from Chrysler for engines the company never delivered. In the formal complaint, Chrysler spokesman Gualberto Ranieri says Daimler's demand for payment "is designed to extort a settlement by wrongfully withholding crucial parts that Daimler has contractually committed to supply to Chrysler Group."

Daimler says Chrysler owes the money since the Auburn Hills, MI based automaker didn't order as many 2.2-liter diesel engines, which are offered in European PT Cruisers, as it agreed to use. Chrysler counters that an April 17 agreement between the two automakers settled several disputes between the two companies, including the volume shortfall. The agreement between the two automakers was likely a preemptive move prior to Chrysler's bankruptcy filing on April 30. Call us crazy, but it looks like it may be a while before Daimler and Chrysler finally kiss and make up.

[source: Automotive News, subs req'd]

REPORT: Chrysler files suit against Daimler, says former parent is threatening production originally appeared on Autoblog on Wed, 26 Aug 2009 17:20:00 EST. Please see our terms for use of feeds.

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