DaimlerChrysler’s loss-making Smart small car brand reiterated on Monday it was not for sale and insisted investment bank Goldman Sachs was acting only as a “buffer zone” to screen potential offers.
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“Every day we are approached by all kinds of companies, consortia and people. This is absolutely clear when a brand is in focus, as is Smart,” spokesman Heinz Gottwick told Reuters.
“We brought in Goldman Sachs for an analytical role to have a kind of buffer zone between the approaches and the company. Nothing has changed,” he told the news agency, repeating the stance that parent Daimler has laid out since the news it had hired Goldman broke this month.
“A sale of Smart is not on the agenda for DaimlerChrysler,” Gottwick reportedly stressed, noting a constant swirl of rumours about potential buyers was annoying Smart staff, who were doing their utmost to hit the target of breaking even in 2007.
DaimlerChrysler chief executive Dieter Zetsche told Reuters at the Detroit motor show this month that Smart was able to offset weak sales of its four-seat model and “overdeliver on the bottom line” in 2005. He was not more specific.
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By GlobalDataSmart reportedly has not made a profit since the brand made its debut in October 1998 with the quirky two-seat model that remains its best seller. It has slashed staff, costs and its planned model line-up in a drive to end the losses by next year.
Reuters said it remains unclear who would be interested in buying Smart, whose sales rose 2.4% in 2005 to 143,000 units.
Citing private equity bidders, the Financial Times newspaper on Monday reported that Goldman had ended exploratory talks on Smart with financial investors last week and narrowed its focus to potential buyers in the automotive sector.
Reuters noted that media reports have suggested prospective buyers could include Immsi group , the parent of Italian scooter maker Piaggio; India’s Tata group, and Suzuki Motor.
But the news agency suggested Daimler would have to make a generous offer to lure buyers, much as BMW did to rid itself in 2000 of Britain’s MG Rover, which collapsed last year.
According to Reuters, Morgan Stanley analysts have said closing Smart would eliminate one of the biggest risks to recovery at premium division Mercedes Car Group but would cost the company as much as EUR4bn (US$4.90 billion).
They reportedly say Smart may instead seek a joint venture partner or partners who could share development and production costs, boost distribution and add purchasing clout.
Mitsubishi Motors manufactures the four-seat Smart model at a plant in the Netherlands but has shown no interest in broadening its involvement, Reuters noted.
