Wednesday, June 21, 2006

UPDATE 2-Daimler denies will pay MMC $305 mln for Smart pullout

Reuters Wed Jun 21, 2006 11:04am ET
TOKYO, June 21 (Reuters) - DaimlerChrysler AG denied on Wednesday a newspaper report that it will pay Mitsubishi Motors Corp. about 35 billion yen ($305 million) in part compensation for dropping production of the Smart four-seat minicar at the Japanese carmaker's Dutch plant. DaimlerChrysler's head of corporate development and northeast Asia, Ruediger Grube, told reporters at an industry conference in Vienna that the report in the Nihon Keizai business daily was "nonsense". A DaimlerChrysler spokesman in Germany said: "The talks are still ongoing." He noted the company had said in March that reorganising the Smart minicar business would cost around 1 billion euros ($1.3 billion). DaimlerChrysler announced in March that it would halt production of the four-seat Smart car model, which Mitsubishi Motors makes under contract at the Dutch plant, NedCar.

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