DETROIT – DaimlerChrysler AG has no plans to sell its Smart car business, says the auto maker's CEO and chairman.

“We said nine months ago that in addition to the new business plan we would be open for potential partnerships,” says Dieter Zetsche. “And we didn't take any action since.”

This remark, he tells reporters at the North American International Auto Show, triggered interest from other companies, and those overtures are being evaluated. But an outright sale of the struggling brand is “not on the table.”

The auto maker's restructuring plan calls for Smart to break even by 2007, and Zetsche says those plans are on track.

Dieter Zetsche

Also high on Zetsche's agenda for 2006 is returning Mercedes-Benz to the top of the luxury market in terms of quality, sales and customer satisfaction.

In the wake of quality lapses, such as one last year that prompted a recall with implications for 1.3 million vehicles, the storied tri-star brand has lagged rivals BMW AG and Toyota Motor Corp.'s Lexus Div.

Among the quality enhancement efforts Zetsche has launched since he took charge of the brand late last year, is an accountability process he implemented during his tenure at the helm of the Chrysler Group.

The process calls for the establishment of hard targets to address quality issues.

If the target is not achieved on time, the problem is brought to the attention of a succession of managers – ending with the CEO – until the issue is resolved. This encourages quick solutions, he suggests.

Last year, as head of Chrysler, Zetsche says just “one or two” problems landed on his desk.

Additionally, there are no plans to reduce the headcount at Mercedes beyond the 8,500 jobs that already have been targeted. The auto maker served notice late last year the reduction would be achieved through voluntary measures such as retirement within 12 months.

Within four months of the announcement, the headcount was reduced by 5,000, a spokesman says.

Zetsche assumed leadership of the Mercedes business unit following the sudden departure last summer of Eckhard Cordes. Zetsche says he will remain in charge of the operations for the foreseeable future.

And if his goals are not met?

“I will have very tough discussions with myself in front of the mirror,” Zetsche says.

emayne@primediabusiness.com