DaimlerChrysler won’t have to sue Asian partner Mitsubishi Motors Corp. to collect compensation for quality problems at its Japanese truck and bus unit, a top executive reportedly said on Friday.

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The contract that gave the German carmaker control of Mitsubishi Fuso Truck and Bus Corp. contains provisions for settling such claims, Eckhard Cordes, the head of DaimlerChrysler’s commercial vehicles division, told a news agency.


“It will not come to a lawsuit,” he told Reuters on the sidelines of an industry conference, although declining to say how much DaimlerChrysler was likely to get as compensation for a series of defects that Fuso officials say the company hid.


He reportedly said Singapore law applied in resolving the dispute.


According to Reuters, Cordes said it would take until 2005 to assess the fallout from 43 recalls to remedy various faults – he said the ultimate cost would depend on the extent of the problems and the number of affected vehicles still in service.

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“We think we are in a good position” to get compensation, he told the news agency, adding that the steps Fuso had taken to address production problems would ultimately win back consumer trust.


Reuters noted that DaimlerChrysler owns 65% of Fuso after paying 52 billion yen ($US479.5 million) this year for a bigger stake in the firm, once Mitsubishi Motors’ crown jewel, on top of $768 million it had spent initially for a 43% stake.


Fuso, which Mitsubishi Motors spun off in January 2003, has been dogged by bad publicity after revelations that it had been hiding dangerous defects from the authorities, the report added.