This isn't good...

[PC Dave]

DCX has to get its act together:

http://money.cnn.com/2005/03/31/Autos/mercedes_recall.reut/index.htm?cnn=yes

[G-Benz]

So it hurts their short-term earnings...so what?

At least they are making an effort to deal with issues, as opposed to allowing long-standing known problems fester and deny it (e.g., the harmonic balancers). This is the MB company I remember.

They've admitted (probably damage control) that the faults are legacy issues, and not new quality problems.

It took them nearly a decade to let quality slide to the point it is now. They aren't going to turn it around and win customer confidence overnight.

At least this is a step in the right direction. Perhaps one day, I will trade in one (or more) of my aging 90's-era MBs for a reliable, high-quality pristine '09 model down the road...

[420SEL]

I think this is a good thing, at least this recall is to fix somthing that is just to improve quality rather than a Ford type recall which would be to fix something that would otherwise get you killed on the road.

[Lebenz]

Interesting article. Did anyone else see the sidebar titled “Biggest recalls” It seems that car manufacturing might be reaching a transitional stage. Obviously there are endless problems, not only with DC. The sidebar indicates GM, Ford, VW, Honda, and we all know of others.

There has to be a series of formulae somewhere that says you can have XX problems in a production line and still make a tidy sum. The gradual lowering of quality is not a product of benighted engineering, it is the result of endless hours of the combination of engineering for cost cutting, and engineering to make a long term (read that post warranty) ROI for the manufacturer. Since not only our society but the culture of western society in general is all about disposable commodities can we reasonably expect to see this trend ever end?

In other words are the forces of a consumer based society so great that the only way to serve the needs is to do so in a perpetually short-term way? Is consumerism itself a short term solution for culture or is it the building blocks for a different future?

Nietzsche expounds on the concept of eternal recurrence. This means that everything, from the simplest of interactions to the most complex structures and organization will happen time and again without end. If he’s correct, then for the future of manufacturing, and by extension, the future of culture throughout the world we will never grow beyond consumerism......

[neanderthal]

i find it intresting that cordes (whatever) says the companyis making the best products ever.

i guess he doens know about the late 80s/ very early 90s.

[PC Dave]

(Four Down Arrows) Mercedes-Benz. Lost in the relentless media drumbeat of GM's bad news of late is the fact that DaimlerChrysler AG's Mercedes-Benz division continues its inexorable death spiral into becoming an also-ran luxury brand. Last Thursday, Mercedes announced a massive recall of 1.3 million cars worldwide to fix electrical and brake system flaws, which exposes M-B's recent statements to the press that their quality problems are "over" as nothing more than wishful thinking, at best. Involved are Mercedes-Benz E-Class and CLS models built between January 2002 and January 2005, which will need to have battery-control software replaced to correct reoccurring power interruptions. Other cars involved are E, SL and CLS models built from June 2001 until March, which will receive upgrades to their braking systems. DaimlerChrysler AG CEO Juergen Schrempp declared that M-B quality problems were "over" as recently as last month, and Eckhard Cordes, the new CEO of the Mercedes Car Group, echoed those comments even more emphatically, calling Mercedes-Benz quality the "best ever." We've said it before, and we'll say it again - the current Mercedes-Benz management regime is responsible for squandering the bullet-proof reputation of one of the most revered luxury brands in the world, a brand reputation based on engineering excellence and technical brilliance that was over 100 years in the making. No management group in automotive history has done less with more than Juergen Schrempp and his team. BMW, Toyota (Lexus), and now even Cadillac and Audi are hammering heretofore unassailable Mercedes-Benz from all sides and on all fronts. The "buzz" on the Mercedes-Benz brand on the street is so bad now that even the sales pros in the trenches are taking note of it at the dealer level. Mercedes' disastrous move down market in the U.S., combined with its equally disastrous quality performance, has dragged the brand down to not only being just another car company fighting for an ever-shrinking slice of the pie, but it's rapidly becoming a second-tier luxury brand after enjoying its rarefied place at the top of the U.S. market for years. Mercedes-Benz simply isn't hot any more and yet here is Juergen Schrempp blithely cruising along saying everything will be fine and that Mercedes will return to its rightful place at the top of the automotive food chain. Well, it's notgonnahappen.com, Juergen. And you and the entire board of management that has stubbornly kept you in place, even extending your contract, are ultimately to blame. Because any other executive at any other car company responsible for one of the biggest brand collapses in automotive history would have been shown the door years ago. Keep watching this space, folks, because we are witnessing the self-destruction of one of the most famous brands in the world right before our eyes - and we'll be reporting it every excruciating step of the way.

(Four down arrows) DaimlerChrysler AG. Things aren't just going bad for DCX - they seem to be getting worse by the day. Last Friday, the company announced a salvage plan for Smart that would fundamentally reduce the division by cutting two models and 700 employees at a cost of $1.55 billion. The Smart roadster and the S.U.V. were killed, but the popular two-seat City-Coupe (forTwo) would remain in preparation for a next-generation version that will debut by 2007 and meet applicable U.S. standards. But DaimlerChrysler also said they would retain the four-seat Smart, known as the forFour, which analysts questioned. Leave it to Juergen Schrempp and his band of rumblin', bumblin', stumblin' and merrily inept men to take a brilliant concept that should have been absolutely perfect for the energy-stressed times we live in and turn it into an unmitigated disaster. Bad decisions plagued this little jewel of an urban car right from the outset and then multiplied exponentially throughout its lifecycle. DaimlerChrysler's nosebleed cost structures and flawed distribution system strangled the Smart from ever delivering the profitability it should have and would have in the hands of just about any other car company. Juergen Schrempp got testy with analysts and reporters in a conference call about it, according to The New York Times, bristling at the suggestion that the company should discontinue the Smart brand altogether, while insisting that Smart would be less costly and more profitable by 2007. "Why should we destroy brand equity, which is by any standard worth $2 billion or more, when we have a cost problem?" said Schrempp. Well, let's see, Juergen, maybe because no one believes that you and your regime can actually get your costs under control, for starters. Or, maybe it's the fact that your credibility is dwindling by the hour with each successive announcement of bad news emanating from DaimlerChrysler headquarters. How bad is it? Even the German media has openly turned against Schrempp. DaimlerChrysler is on a roll - right downhill. If it weren't for the red-hot Chrysler Group in the U.S., DCX would be on the ropes.

(Three down arrows) DaimlerChrysler. It seems DCX shareholders were more than a little upset at the company's annual meeting in Berlin on Wednesday, confronting Juergen Schrempp about everything from the troubles at Mercedes to falling earnings and a stock price that is well below where it stood at the time of the 1998 merger. As reported in The Detroit News, Schrempp insisted to the gathering of thousands that clear progress has been made, but he seemed to be upstaged by angry shareholders, one of whom succinctly said, "This is becoming a nightmare." How bad is it? Some fund managers had plans to abstain from a largely symbolic vote that would approve the management team's performance. Well, if you abstain from giving a vote of confidence, isn't that as good as saying you think they suck?!?!?

[yal]

Damn. Its like watching a really bad accident in super slo mo
I still think the share holders and their greed is to blame, they saw how green the grass was over at BMW and others and said we want some of that.

[braverichard]

Most people are looking at this whole situation with such short-sightedness it is disgusting!! G-Benz you are absolutely correct. This is a voluntary recall. MB didn't have to do it. It wasn't mandated by the NHTSA. Instead they realize that this is a great step towards restoring their quality and reputation. A recall is never a bad thing as you actually get problems fixed. Also, since everyone's into panning MB's quality, no one noticed that the number of complaints from owners of brand new MBs decreased by an average of 20% as reported by all the quality surveys for 2004. Trust me, the quality of MB will be restored quickly and smartly. This company has seen much worse obstacles and overcame all of them with flying colors (WWI, WWII, arrival of Lexus, Acura, Infiniti, rise of BMW, etc).

Furthermore, how do you explain the SL having one of the lowest reliability scores in Consumer Reports yet also having the very highest owner satisfaction rate in the same report? Well, have you had a look at the complaints lately? Try these: high fuel consumption, confusing controls, excessive electronic intervention, wind noise! Are those really quality-related complaints? No wonder SL owners are happy.

[Kuan]

DCX is still doing quite well considering the current climate in that sector. It made the second largest profit last year at 5.12 billion and 157 billion in sales, second behind Toyota which came iin at 7.99 billion and 136 billion in sales. Compare that to Ford with 164 billion in sales and a measly 760 million in profits and GM with 185 million in sales and 3.82 billion in profits.

The problem isn't DCX, it's MB.

[braverichard]

Last year, MB (even with all the crap people are saying about its cars) made a profit of $2.3 billion. Warranty claims were down 45% worldwide, enabling the huge increase in profit from the previous year even with sales that were lower than those from the year before by 3% worldwide. DCX also makes lots of money from its Truck Division and then the Chrysler Group became profitable again last year ($1.8 billion profit). The Truck Division was restructured and brought back to profit by Dr. Cordes, the current Head of Mercedes Car Group. He's another reason why I believe MB will be fixed quickly. Furthermore, if he restores MB's quality and increases the profit margin(these are MB's two biggest problems today), he will gain enough clout to become DCX's next CEO in 2008 when Dr. Schremp steps down.

[PC Dave]

http://www.peachparts.com/shopforum/showthread.php?t=120680

Yep, every recall is a great sign of MB quality on the rise! The next three or four recalls will really show how good MB quality is getting!

Seriously, I'm pleased to see they're finally acknowledging that there's a problem. It's also good that DCX has truck profits, Chrysler profits, and other profits to keep it going. Personally, I'm not in the market for an MB commercial truck, and probably not for a Chrysler product. I care about Mercedes cars (and maybe SUV's), and the jury's still out - besides the public surveys and the "MB lemon" websites, there's plenty of anecdotal evidence on this site. The guys at Autoextremist are right that it takes a long time to build a reputation, and a somewhat shorter time to damage one. Maybe MB dodged a bullet in the US with the general public, maybe not. If you look at the MBCA Star interview 2 issues ago with the head of US mktg., it's clear that the MB enthusiast community is well aware of what's going on, and MB may have lost some of its most loyal customers permanently. The name is still hot and these old customers can be replaced by hip yuppies, but those customers can just as easily be seduced by BMW, Audi or Infiniti for their next car, unlike the lost loyalists. I hope that MB makes it work.