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VW in talks with Chrysler over tie-up

2005-08-24 09:26

The source also partially confirmed a report in the German business newspaper Handelsblatt, but said that no document has been signed so far.

According to Handelsblatt, the management and supervisory board of German-US auto giant DaimlerChrysler have already approved the tie-up in principle. The deal was expected to be made official during next month's auto show in Frankfurt.

A tie-up was seen as strongly benefiting Volkswagen, which has lost ground in the United State auto market under heavy pressure in a price war. VW lacks models in strategic niche segments, particularly minivans.

The proposed joint minivan would be based on Chrysler's new version of the Chrysler Voyager, due in 2007.

VW and DaimlerChryler are already co-operating on other projects. Chrysler's Dodge brand will soon be marketed outside the United States on a compact car equipped with a VW engine.

VW unit Volkswagen Brand Group is headed by Wolfgang Bernhard, who was previously Chrysler's chief operating officer.

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