INTERVIEW - Daimler CEO wants broader cooperation with BMW

By Christiaan Hetzner and Hendrik Sackmann

FRANKFURT/STUTTGART (Reuters) - Daimler would like to expand plans for cooperation "as equal partners" with BMW beyond an agreement to bundle purchasing of components, Chief Executive Dieter Zetsche told Reuters.

"In general I only see a few areas where working together is in principle out of the question," Zetsche said in an interview at Daimler headquarters in Stuttgart's Untertuerkheim district.

"It's clear that we are two independent companies whose success in the market depends of the strength of our brands, so brand integrity is a cardinal imperative. This has to be considered at all times but it is not something that would prevent broad cooperation."

While he would not say what areas were off limits, he explained that Daimler had to ensure that when its customers drive off a dealer lot, they believe they have bought a luxury car with the unique characteristics of a Mercedes.

Unlike German rival Audi or Volvo of Sweden, BMW and Mercedes share a specialisation in rear-wheel-drive cars. At the same time the performance and design of their cars appeal to two largely different customer groups.

"The issues we are discussing (with BMW) have to be examined closely from the very beginning in order not to realise later halfway through that you made a mistake. That is why any results we might achieve would be that much more thorough," he said.

Zetsche refuted the credo of pure production size that has come to exemplify Sergio Marchionne's vision at Fiat, but he acknowledged that a key ingredient to success was the consistent use of modules to build Mercedes-Benz cars across segments as a method of gaining economies of scale.

"That offers the main opportunity for volume effects and then we can look at whether they can be applied jointly across company borders, which is certainly a sensible goal," he said.