DaimlerChrysler will not sell off its Chrysler division, DC board member Ruediger Grube said at an industry gathering in Europe.

“We are in for the long term,” Grube, DC’s head of corporate development, told the Automotive News Congress in Montreux.

Grube said DC has already transformed Chrysler’s fortunes by improving its product portfolio, increasing customer satisfaction and boosting productivity.

“By 2006 we will have reached all our benchmarks,” said Grube. “We are dedicated to it.”

A question mark was raised over DC’s commitment to Chrysler after DC refused to rescue Mitsubishi Motors, its troubled Japanese partner.

DC’s majority 37.3% stake in Mitsubishi will be reduced to about 25%, said Grube. DC also will give up its 10.4% share in South Korea’s largest carmaker Hyundai.

But DC will continue partnerships with Mitsubishi and Hyundai Motors, Grube told the Congress.

He said Mercedes and Chrysler models would never be built together.

“The two brands will not share platforms or important components. Mercedes is a luxury brand that has 118 years of heritage. We will not risk that.”

Grube acknowledged that the Mercedes car group had problems with quality but said DC is 100% committed to taking Mercedes to the No. 1 position in the J.D. Power & Associates customer satisfaction ranking.

The Mercedes brand has been hit by electronics and braking system failures in some of its models, most notably the current E-Class.

Customer satisfaction ratings have dropped sharply even in the brand’s German home market.