BRUSSELS – Daimler AG’s new tie-up with the Renault SA-Nissan Motor Co. Ltd. alliance “isn’t starting like the Chrysler merger and won’t end like Chrysler,” CEO Dieter Zetsche says, referring to Daimler’s ill-fated takeover of the former Chrysler Corp.

“It is a totally different concept from Chrysler, and I am optimistic that the result be different as well.”

The difference is the German, French and Japanese auto makers will cooperate on specific global projects that will see the development of small cars, commercial vehicles and future powertrains, rather than one company trying to run the other.

It also is strategic and based on more than a few limited projects, Renault CEO Carlos Ghosn points out at a press conference here today to explain the new partnership.

Another difference is in shared profit. Ghosn says the cooperation will save €2 billion ($2.7 billion) over five years, shared about equally by Renault and Nissan. Zetsche says Daimler’s savings will be of the same order of magnitude.

The companies will not break down the savings into various divisions, such as purchasing and increased volume. “We want to focus on making work and not on bookkeeping,” he says.

Essentially, the word “strategic cooperation” in their business language means the three auto makers are opening their books and their plans to one another, but there will be no exchange of management.

The exchange of cross-shareholdings of 3.1%, Ghosn says, is “to give signal inside the company that this is a real cooperation. If people inside have the impression this is temporary, they don’t open the books.”

Daimler will take a 3.1% stake each in Renault and Nissan, while Renault and Nissan each will take a 1.55% share of Daimler. The exchange of shares did not go higher than 3.1% because “these are not times to dedicate a lot of cash to buy our own shares,” Ghosn says.

Renault, Nissan and Daimler already have agreed on several specific projects:

  • A common platform for the future Smart. This was the first discussion that kicked off the rest, Zetsche says. The 2-door, 2-seat Smart is in its second generation and has seldom profited. A 4-door, 4-seat Smart made in cooperation with Mitsubishi Motors Corp. was a commercial failure.

The next Smart Fortwo and the next Renault Twingo will be built on a common platform, developed together, in 2-door and 4-door variants. The 2-door models will be built at the Smart Car factory in Hambach, France, and the 4-door models at Renault’s factory in Novo Mesto, Slovenia. Electric versions will be available from the start, in 2013.

  • ±Sharing powertrains. Renault-Nissan will sell 3- and 4-cyl. gasoline engines to Daimler for the next-gen Smart Fortwo, and Daimler will sell Nissan, for its Infiniti luxury brand, 4- and 6-cyl. engines, especially diesels. Together, the auto makers will cooperate on meeting future norms for internal-combustion engines. Zetsche says by combining technologies from the two sides, the result will be extremely efficient small engines.
  • {Light commercial vehicles. Renault will sell a version of the Kangoo to Mercedes-Benz in 2012, giving the German auto maker a new entry-level delivery vehicle. This will add volume to Renault’s Kangoo plant in Mauberge, France. In addition, Renault will provide a small engine and transmission to Daimler for its Vito midsize van to give it a new, lower-priced entry-level model.

In the short term, Nissan and Daimler each get new technology from the relationship and Renault gets volume to fill factories.

The auto makers say the strategic cooperation works well because there is so little overlap among the three companies’ products and customer bases.

“There is very little cross consideration of customers,” says Zetsche. “Our people are open to sharing information because they are not afraid they will see what they discussed earlier (on products) competing against their own products.”

Both sides make large commercial vans with other partners: Renault and Nissan with General Motors Co. in a deal that still is being negotiated for the future, and Daimler with Volkswagen AG in a tie-up that runs for another half-dozen years.

That area certainly is one the new partners will examine for a possible project if the current ones go well.

“Renault has its own plans to move up little by little to luxury and premium markets,” says Ghosn, and “the exchanges are going to support that.” But the partners are “very conscious of the fact that we need to keep each brand very different from the other.”

While the first concrete projects primarily are centered in Europe, Zetsche says Smart already is selling as many cars in the Western Hemisphere as in Asia, and Ghosn says many projects to come “will be for the United States or emerging markets.”

At the close of business April 6, Daimler’s 3.1% shareholdings in Renault-Nissan was worth €1.25 billion ($1.67 billion), and Renault-Nissan’s combined 3.1% of Daimler shares were worth €1.17 billion ($1.56 billion).

The exchange of shares on the Renault-Nissan side benefits Nissan. At the end of several swaps, Nissan continues to own 15% of Renault, but Renault’s holding in Nissan drops from 44.3% to 43.4%. Zetsche says there is no intention to go further with shareholding. “If it were 5% or 7%, it would make no difference.”

The three auto makers say in their press communiqué “a key objective is to increase competitiveness of all partners through a substantial increase in volumes, leading to economies of scale and cost-sharing in development.”

Ghosn insists the object is not scale for itself because there are many examples of failed attempts to achieve scale when it is not intelligently applied.

He says scale also is essential for development because a volume car maker today must be in every emerging country, in every segment and developing every technology from better IC engines through hybrids to electric vehicles.

“Do not be surprised if we continue to add scale” through new cooperations, Ghosn says. “Scale is a lever, but the question is what you do with it. If you don’t use it, scale is complexity and confusion. We are going to continue to work and talk with many car manufacturers.”

Indicating Zetsche, Ghosn says, “We will be talking together about eventual next steps.”

A second driver for the cooperation, more on the Daimler side than for Renault-Nissan, is the pressure on auto makers to reduce carbon-dioxide emissions.

“For Daimler, it plays a very significant role,” Zetsche says, which brings him back to the beginning when discussions with Renault-Nissan started with Smart. “Within our discussions, we found our technologies were compatible, as well.”

A committee of 12 people, led by Zetsche and Ghosn, will oversee the joint partnership. The Renault-Nissan side will be directed by Renault-Nissan B.V., a Belgian structure already in place to watch over cooperation between the French and Japanese partners.

Ghosn appears to look further into the future than Zetsche at the press conference, evoking more often the potential of developing further cooperation.

In the Renault-Nissan Alliance, Ghosn says, “We learned that we need to look beyond scale. The key for success is respect for the partners, transparency and confidence, and that each partner has the liberty to guard its own characteristics.”

Zetsche speaks less of future cooperation, although he agrees work on electric vehicles and batteries would be important. In a light-hearted answer to a question about cooperation in Formula 1 racing, says Zetsche: “We have not discussed sharing drivers.”