Daimler-Benz News from February 22, 1995

Daimler-Benz Purchasing Drive
in the New Federal States

Meeting of adopted firms in Saxony-Anhalt

Magdeburg, February 22, 1995
On February 21 and 22, 1995, in conjunction with the Magdeburg and Halle-Dessau chambers of commerce, the first meeting of 30 adopted companies in Saxony-Anhalt took place. Its aim: to promote the regional markets. With company presentations, exchange of experiences and general discussions, the companies in Saxony-Anhalt cooperating with the Daimler-Benz Group as part of its purchasing drive in the new federal states had their first opportunity to come into contact with each other.

It was around 18 months ago that the "guardians" first began their work as mediators between East German companies interested in a supplier's agreement with the Daimler-Benz Group, and the corporate units in the Group - Mercedes-Benz AG, AEG Daimler-Benz Industrie, Daimler-Benz Aerospace and Daimler-Benz InterServices. They are helping the East German firms to detect and remove any possible weak spots, and to find the correct partner with which to build up a lasting business relationship.

Joint efforts have succeeded in quadrupling the purchasing volume at 55 of 180 adopted companies to some DM 130 million. The inquiry quota at the companies under care rose by 20%. Visits to the adopted companies by those in charge of purchasing in the group companies were arranged, while presentations of the adopted companies were organized with the relevant buyers. In many cases, the guardians were also able to assist with the opening up of new business contacts with system suppliers. The network is also functioning well within the "adoptive family" too. More than 50 business connections came about as a result of the guardians mediating between the East German companies.

Already the intervention of the Daimler-Benz project group in the purchasing drive in the new federal states has been considerable. Dr. Gerhard Liener, in charge of finance and materials on the Daimler-Benz board of directors and the person responsible for the group's purchasing drive in the new federal states, recently announced in Weimar that it had been possible to double Daimler-Benz's volume of purchases to DM 1 billion in 1994, thus achieving its target one year ahead of schedule.

If, in the initial phase over two years ago, the main concern was to reconcile supply and demand, in the second phase East German firms have been given the opportunity to analyze and remedy possible weaknesses through the "guardians" scheme. Today the East German firms have attained a technical and economic standard that allows them to submit competitive tenders and independently develop new markets. The impressive achievement of a DM 1 billion volume of purchases through the corporate units of Mercedes-Benz AG, AEG Daimler-Benz Industrie, Daimler-Benz Aerospace and Daimler-Benz InterServices has secured some 10,000 to 11,000 jobs in the new federal states. In future the emphasis will be more on continuing to promote business contacts, which events like the meeting in Magdeburg are intended to serve. To date, some 87 West German firms have become involved in the purchasing drive in the new federal states. It has been underway for two years, first setting itself the target in 1991 to double the then DM10 billion volume of purchases by 1995. The DM 35 billion already achieved by 1993, thanks to the commitment of the companies involved, far exceeded this objective.

Similarly, the Daimler-Benz Group had set itself the target of increasing the volume of purchases from DM 0.6 billion in 1992 to DM 1 billion by 1995. By 1993 the volume had already risen to DM 800 million. Yet it was not the aim of Daimler-Benz to simply secure and increase employment in the East German states by relocating demand; it also sought to support the economic build-up of the new federal states through the transfer of marketable technologies. The previous activities had only been realized through great personal commitment. The project team behind the purchasing drive at Daimler-Benz is now seeking to turn the initiative into a drive towards increased industrialization.

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© 1995 Daimler-Benz