While other automakers make big media headlines with Internet tie-ups, DaimlerChrysler says it is laying the foundation for a seamless launch of its own Internet strategy.
'No (car company) can afford to ignore the web. They need to understand it and use it as a partner,' said Susan Unger, DaimlerChrysler's chief information officer.
Unger acknowledged that DaimlerChrysler is conspicuously absent from the high-profile Internet tie-ups sweeping the industry. Speaking at the Automotive News World Congress, Unger said she is betting that a successful Internet strategy is based on the so-called 'mortar portion' of the business.
Roughly 85 percent of total investment in an Internet strategy is put into the behind-the-scenes infrastructure: arranging delivery systems and building in-house connections and company communications, Unger said.
The remaining 15 percent is in the front end, the screens a computer user sees when logging on to a company site, she said. So far, she said, DaimlerChrysler is addressing the mortar.
This might not be a bad idea, said David Andrea, chief economist at CSM Worldwide, an automotive research and forecasting firm in Northville, Michigan. 'The traditional marketing message is if you are second or third in, you're at a disadvantage,' Andrea said. 'But if the reason they are on the sidelines is because they are working on the back-office aspects of their strategy, I think they will be OK.'
DaimlerChrysler's three-pronged strategy for Internet success includes designing products, paving the way for volume production and supporting the sales and service arm of the company.
Take the 2001 version of DaimlerChrysler's mid-sized Dodge Stratus. It was designed digitally with a clay model built only after the vehicle's look was nearly finished in a computer. The new vehicle, along with its siblings, the Chrysler Sebring sedan, coupe and convertible, took just 26 months to go from design approval to production, compared with nearly 35 months for the current version.
In volume production, Daimler-Chrysler has, like most other automakers, linked with all of its Tier 1 suppliers. Now, Unger said in an interview after her speech, the goal is to push the Internet connections down to Tier 2 and Tier 3 suppliers.
In the distribution chain, Daimler-Chrysler's dealers take part in what are called Market Centers. Through the system, now being tested in Indianapolis, dealers key in their supply needs and the company negotiates purchases, taking advantage of economies of scale.
So is DaimlerChrysler behind the pack when it comes to announcing a high-profile Internet tie-up?
Unger said: 'We won't get into a glitzy relationship just to make a splash.'