DaimlerChrysler is tightening its grip over Mitsubishi Motors, in which it holds a 37 per cent stake, with the appointment of German Gunter Butschek to manage the NedCar plant in Holland. Butschek, a rising Daimler-Chrysler star who has run the company's South African operation, takes over as chief executive and president of NedCar next month, subject to anticipated approval by the Dutch firm's works council.

The appointment comes as DC and MMC prepare to build a new generation of Mitsubishis and Smarts at the NedCar plant in Born. These include three and five-door CZ2 or “Compact”, sized between Ford's Fiesta and Focus, plus Smart's new four-door model. Sharing a common platform, they are due to enter production in early 2004.

NedCar, with an annual production capacity of 280,000 units, currently makes 220,000 cars. But DC claims that no decision has been taken on utilising capacity by building a Chrysler replacement for the lacklustre Neon.

Closer integration between DC and Mitsubishi includes building a joint engine production facility in East Germany to supply the NedCar factory. Meanwhile in Japan Mitsubishi is dismantling its supplier “closed shop”. A new streamlined purchasing system will allow the Japanese carmaker to be independent from tied component makers.