November 17

This Day in History

Automotive

Nov 17, 1998:

"Day One" for DaimlerChrysler on NYSE

On this day in 1998, the brand-new DaimlerChrysler began trading its shares on the New York Stock Exchange. The company had formed five days earlier, when the American Chrysler Corporation merged with the German conglomerate Daimler-Benz AG. As a result of the merger, DaimlerChrysler became the world's fifth-largest automaker (behind General Motors, Ford, Toyota and Volkswagen).

In January 1886, a German inventor named Karl Benz patented the first true motor car: the Benz Patent Motorwagen, a three-wheeled machine with a four-stroke gasoline engine. In 1888, Benz's company, a manufacturer of industrial machines called Benz & Company Rheinische Gasmotoren-Fabrik (Benz & Cie. for short), began to sell the Motorwagen to the public. The next year, German engineers Gottlieb Daimler and Wilhelm Maybach began to sell the world's first four-wheeled automobile powered by a gasoline engine. They formed the company Daimler-Motoren-Gesellschaft in 1890. (In 1900, D-M-G sold the first Mercedes car to Austrian racer Emil Jellinek.) In 1926, Benz & Cie. and D-M-G officially merged, forming a new company called Daimler-Benz AG.

In 1925, American machinist Walter P. Chrysler bought Detroit's 20-year-old Maxwell Motor Corporation and renamed it the Chrysler Corporation. In 1928, Chrysler expanded its holdings by buying the Dodge brand and creating the new DeSoto and Plymouth marques. By 1936, Chrysler was the second-largest car company in the United States. In 1979, after a half-century of ups and downs, Chrysler had to petition Congress for a $1.5 billion bailout to avoid bankruptcy, but by 1983—thanks mostly to its invention of the minivan and the fuel-efficient K-car—it had repaid that loan in full.

The Daimler-Chrysler merger, for which Daimler-Benz AG paid $36 billion, was supposed to create a single powerhouse car company that could compete in all markets, all over the world. (Daimler-Benz was known for its high-quality luxury cars and sturdy trucks, while Chrysler's minivans and Jeeps had a big chunk of the growing sport- utility vehicle market; meanwhile, the American company seemed to have mastered the art of high-volume, low-cost manufacturing.) However, things did not quite work out that way. Chrysler actually lost so much money—$1.5 billion in 2006 alone—that in 2007 Daimler paid a private equity firm to take the company off its hands.

In 2009, Chrysler filed for bankruptcy again. In order to stay afloat, it merged with the Italian company Fiat.

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