Gerhard Wolf needs diesel engines — badly. The senior manager-M-Class project, DaimlerChrysler AG, has orders for 40,000 diesel Mercedes M-Class sport/utility vehicles a year but can only get 25,000 direct-injection engines from the plant in Unterturkheim, Germany. The engine plant, near Stuttgart, is running three shifts a day to produce 200,000 engines yearly, of which a quarter go to M-Class and the rest to power C-, E- and S-Class cars. “It's a Stuttgart problem,” says Mr. Wolf. ...

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