DaimlerChrysler will reduce its distribution costs in small ways everywhere except North America, where both companies are mature.
In Europe and many other markets, costs will be cut behind the scenes by combining logistics, warehousing, preparation and other functions. The scope of the cuts is not known.
Showrooms will be kept separate. In Germany, particularly, Mercedes-Benz dealers will be encouraged to open Chrysler-Jeep stores.
In some new markets, dealerships may sell vehicles from both companies.
'I don't see dramatic changes coming up,' said Joachim Schmidt, 49, head of Mercedes-Benz distribution and marketing. There will be synergies between Daimler and Chrysler, 'but these synergies will only affect the wholesale companies and not the dealerships.'
He said Daimler executives are evaluating how and where common wholesale companies make sense.
In 12 major markets, both companies have sales subsidiaries. In four other countries, Chrysler has a subsidiary and Daimler does not. In 11 countries, only Daimler has a subsidiary.
'The policy for DaimlerChrysler will be the strict separation of the two brands wherever a customer gets in contact with them,' said Schmidt. 'The synergies will be used in the background.'
Brands will not mix in dealerships but Mercedes dealers will be encouraged to open franchises for Chrysler cars, said Schmidt. The system would then be similar to BMW-Rover, with common ownership and a common back office but a separate appearance in public.
In countries where neither is strong, Schmidt said, DaimlerChrysler dealers might offer both brands in separate showrooms.
At the wholesale level, cost savings will arise from common handling and warehousing of parts and preparation of cars before they are delivered to dealers. The amount of savings cannot yet be estimated.
'They have given themselves three years to get the basis right,' said David Fletcher, an executive at Allison Associates, a London-based dealer consultancy. 'It's going to take a while until the plans and the moves for the next century have a clear shape.'
Chrysler will benefit mostly in western Europe and in Japan, where Daimler-Benz has a very strong network, said Schmidt.
In North America, Schmidt sees no reason to bring the wholesalers of both sides together.
'The system there works sufficiently and we also do not need more dealers in the USA,' said Schmidt. 'We want to offer class and not mass.'
While nothing has been decided, DaimlerChrysler is likely to reduce the number of dealers in strong markets like western Europe and Japan and to increase them in South America and in Asia.
In Brazil, Daimler-Benz wants to add about 50 new dealers. These should be mainly focused on sales of the A-class that will be launched there in April 1999, said Schmidt. Brazil A-class volume is projected at 60,000 units a year.
Chrysler is also expanding in Brazil, with the Dakota pickup going into production this summer.
Mercedes-Benz dealers are relaxed.
'Everything is very fresh and the development can become very interesting,' said Claus Altemoeller, executive at the company-owned Mercedes-Benz dealership in Frankfurt.
'Chrysler has a good choice of models, although they would not fit in our showrooms,' he said. 'If dealers would open a separate franchise for Chrysler cars, they could attract other customers, especially since the Chrysler image in Germany will increase now.'
Peter Schmidt, business analyst with AID in the UK, noted that sales of Rover cars are up strongly in Germany since BMW bought Rover.
Schmidt even sees a scenario for change in the USA. 'Chrysler Jeep dealers in the US could sell the M-class without causing confusion,' said Schmidt. 'I see this as a realistic chance.'