6 Automotive Partnerships Made in Hell

Looking at the automotive industry, one would be hard pressed to find a brand that’s entirely independent. There is a good reason behind this: partnerships between carmakers are an excellent way to share technology while splitting development and production costs. In theory, both parties benefit. 

Most automotive mergers happen between one larger brand or automotive group with plenty of funding and a smaller independent brand. However, there are certain cases where the partnership can quickly turn sour through a mishandled merger, and both parties suffer. The main reason for this is cost, with one company not having or giving enough funds to revitalize a small brand to make more compelling products. The following list shows examples of the worst-handled automotive partnerships. 

1. Mercedes-Benz and Chrysler (1998 to 2007)

The merger between Mercedes-Benz and Chrysler was one of the largest automotive mergers ever, and certainly one of the most disastrous. It was deemed a merger of equals by the two brands, but that was far from the case. In truth, it was more of an acquisition by Mercedes of the Chrysler corporation. 

Mercedes made this move to increase profitability in the North American market; meanwhile, Chrysler was trying to establish more dominance in both domestic and international markets. The most notable car to come from this merger was the Chrysler Crossfire, which shared a platform with the first-generation Mercedes SLK. By the time it was introduced, Mercedes was already selling the second-generation SLK, but Mercedes wouldn’t let Chrysler use the newer platform for its model. The approach to making the Crossfire perfectly demonstrates the issue with DaimlerChrysler: Chrysler received the leftovers from Mercedes, not the latest and greatest it had to offer, so it was clear that this wasn’t a merger of equals. 

Other notable products from this merger were the Chrysler 300, which rode on a Mercedes E-Class platform that would later be shared with the Dodge Challenger and Charger. 

By far the most successful vehicle to come from this venture was the Sprinter Van, an absolute workhorse that's still a common sight today. Despite these attempts to expand Chrysler, the brand failed to turn a profit, and in 2006, Chrysler reported a loss of $1.5 billion. This resulted in Mercedes selling its stake in the brand the following year. The issue with this relationship is that making Chrysler profitable was a far too difficult task. It was a brand that suffered from a reputation of bad build quality and an aging lineup; revamping that image was a task too large even for Mercedes. 

2. Ford and Volvo (1999 to 2010)

In the 1980s, Ford went on a purchasing spree of European brands, buying Aston Martin and later Jaguar. The decision to buy Volvo came as Ford wanted to compete with mainstream European luxury brands like BMW and Audi. This choice also came at a time when Ford’s rival, GM, purchased Saab with the same intention. Before the merger with Ford, Volvo was already a successful automaker known for its reliability and quality. 

Ford’s vision with Volvo was to move the brand upmarket while cutting back on costs through platform and part sharing. Volvo’s image naturally suffered; its cars were still good, but not as robust as they had previously been when Volvo was an independent brand. Ford benefited from Volvo, using its infotainment systems, all-wheel drive systems, and Volvo’s renowned safety technology. Ford also used a Volvo vehicle platform to develop its own cars such as the Taurus and Flex. 

Following several years of partnership, Volvo began reporting a loss, something that never happened to the company when it was independent. Ford sold Volvo in 2010 to the Chinese automaker Geely for about $1.5 billion, about $5 billion less than Ford’s purchase price. 

3. General Motors and Saab (2000 to 2011)

Saab was a quirky independent Swedish automaker known for innovation and prioritizing safety. Saab’s other big innovation was turbocharging. At a time when most automakers were using large displacement engines to achieve performance, Saab instead opted for smaller turbocharged engines. While this is common today, it was revolutionary 40 years ago. Despite its brilliant engineering, Saab was still a small brand with a limited model range and long model lifecycles. 

General Motors was looking to compete with the rising European luxury brands and bought a stake in Saab in the 1980s, fully gaining ownership in 2000. GM approached the Saab brand with its usual tactics: sharing platforms and rebadging its models into oblivion, completely eroding Saab’s brand identity. After GM gained complete ownership of the brand, Saab ceased to sell vehicles designed in-house. Instead, Saab was reduced to selling more luxurious GM models and even a Subaru under the Saab name. Devoted Saab customers noticed this change, which resulted in the brand’s decline and eventual bankruptcy in 2011. 

4. BMW and Rover (1994 to 2000) 

Rover Group used to be part of a massive failing automotive group called British Leyland, which was made up of over 15 separate brands. British Leyland was an absolute disaster and was broken up in 1986. BMW bought the Rover Group in 1994 in an attempt to have a brand under its umbrella with a mass market appeal, without resorting to making cheaper BMW-branded models. With the purchase of the Rover Group, BMW gained the rights to brands with some exceptional value, particularly Land Rover and Mini. Meanwhile, the actual Rover brand, which BMW wanted to revive as its budget brand, was in a poor state. After years of underfunding, its lineup was extremely dated, and its quality was poor. BMW burdened itself with the massive task of reviving a brand that was dragged through the mud for decades. This venture was so costly that it almost bankrupted BMW itself. BMW’s venture was so unsuccessful that it sold Rover and its assets off in 2000, only just after launching the then-new Rover 75, a car meant to be the brand’s big return. After the sale, BMW only kept the rights to the Mini name, which it successfully revived to be its affordable compact brand. 

 5. Rover, British Leyland, and British Motor Holdings (BMH)

In the 1960s, Rover was an independent brand that was developing some revolutionary cars. Rover was under the control of Leyland Motor Cars when the company merged with British Motor Holdings (BMH) to create the automotive giant that was British Leyland. 

In the late 1960s, Rover was destined to have an extremely compelling lineup. Its P6, released in 1963, was highly praised, while its older P5 was dated but still sold well. Rover planned to replace both of these models with a single one called the P8. This was a luxurious sports sedan directly meant to rival Mercedes-Benz. The P8 would come with Rover's newly acquired 3.5L V8 engine of Buick origins. This engine would also have gone into the P6 BS, a proposed mid-engine grand tourer. 

Rover was also testing hydropneumatic suspension at the time, allowing its cars to have world-class comfort. Finally, Rover would introduce a luxury off-roader in 1970 called the Range Rover to complete the lineup. These three vehicles would have made up Rover's premium lineup that would have taken on the automotive world. 

However, with the merger of Leyland and BMH in 1968, the Rover brand was deemed to be a rival to Jaguar, which was previously under BMH. Despite the existence of functioning prototypes, the P8 and P6 BS projects were both cancelled, with only the Range Rover ever seeing the light of day. Under the ownership of British Leyland, the Rover brand lost funding, and quality declined with increased worker strikes. British Leyland ultimately dispersed in 1987, and Rover was sold off multiple times, never finding a successful parent company. The Jaguar-Land Rover group currently own the rights to the brand. 

6. Chrysler and Mitsubishi (1971 to 2016) 

The history between Chrysler and Mitsubishi is long and complex. In 1971, Chrysler bought a 15 per cent stake in Mitsubishi to sell some of its rebadged compact models as Dodges in North America. By the 1980s, this practice continued, however, imports of Mitsubishis were limited to 30,000 units per year due to U.S. import regulations. To bypass this rule, Diamond Star Motors (DSM) was set up, a name created by combining the two companies’ logos. DSM would be a joint venture that would allow Mitsubishi models to be manufactured in the U.S. The Mitsubishi Eclipse was notably born from this move, which would also share a platform with the Plymouth Laser and Eagle Talon. In 1993, Mitsubishi bought out Chrysler’s share in DSM, but would continue supplying engines for the Chrysler group until the 2000s. 

The issue with this partnership comes down to the brands themselves. Chrysler and Mitsubishi have never been industry leaders and were brands that constantly suffered financial problems. All DSM’s products were half-baked attempts to compete in multiple market segments, and while some were successful, it was never quite enough to justify the partnerships. Neither brand was capable enough to fund the other, and ultimately, both brands would be acquired by larger corporations further down the line.