Zap still pursuing Daimler over Smart deal, California Supreme Court next
Once upon a time Zap had a dream to import the Smart ForTwo to the U.S. market. Unfortunately for Zap, that plan didn't work out and Smart's parent Daimler ultimately did a deal with Roger Penske to be the U.S. distributor for Smart. Zap decided not to take this lying down and ultimately filed a lawsuit in 2005 against Daimler (then DaimlerChrysler) alleging the German company interfered with their business (need more background? click here). So far Zap has had no success in U.S. courts, with both a trial court and appeals court ruling they had no jurisdiction over Daimler in the case. Undaunted, Zap is now going to the California Supreme Court hoping to get them to reverse the previous rulings. Zap hopes for a ruling in about three months.
[Source: Zap]
Reader Comments (Page 1 of 1)
jeffzekas 12:08PM (2/28/2008)
Not mentioned is that Zap put a $12,000 to $15,000 greed mark-up on Smart ForTwo's!!! So, Daimler giving the franchise to Roger Penske was a good thing! Zap should crawl back into its hole, and be ashamed for its blatant profiteering on the recent economy trend! Now, with Smart's being sold for the European market price, used Canadian ForTwo's on ebay should be coming down in price!
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Rojo 2:29PM (2/28/2008)
Chalk that up as a frivolous lawsuit.
Daimler lost money using Zap as a middleman so they went their own way. That's a sound business decision in my book.
Get over it Zap. Want to make more money? Stop making 'cars' that cause a cerebral hemorrhage when viewed and build that Zap-X you've been touting for investments but never planned to produce.
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Jon Dutch 4:12PM (2/28/2008)
jeffzekas, If memory serves me correct on this issue, the reason for the high mark-up on the Smart FourTwo from ZAP wasn't greed. I didn't like it anymore than anyone else. In fact when I went to buy a car to replace my tired old 1987 Golf I initially looked at the Smart from ZAP. Sure I was shocked about the price too, so I opted for a '01 A4 instead. When I did my research on the subject though (and I have to thank my sales man at I-5 motors in Fife for the help on that one) the price suddenly made sense.
Daimler wouldn't sell the Smart in the US. They also wouldn't sell the Smart to ZAP. So ZAP, recognizing a market for the cars here in the US, did what they could to make it happen. As a result of this they went through an intermediary wholesaler of SmartCars in Europe. They then had to ship the vehicles to California, than convert the vehicle to meet US NTHSA standards, than distribute them to dealers and eventually sell them to you. Start adding up all the hands that took a piece along the way and it quickly becomes apparent why they had to charge what they did. If Daimler had just gone ahead and sold the cars to ZAP straight off, already meeting US standards, than we would have the same price that Penske is now promising. ZAP went through and did all the leg work too, I think, by having the crash-testing done and getting the car homologated for the US. Sorry, I have to side with ZAP on this one.
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mattypape 5:33PM (2/28/2008)
Sorry i dont dont see what grounds zap have to sue daimler on.
They have done nothing wrong, its there car at the end of the day, so they can do what they want with it.
If it wasnt for daimler zap would have probably not been able to be profitable in recent years, especially with there rather poor ideas they have for electric cars.
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JP Hedin aka DrSmart 12:52PM (2/29/2008)
I still don't understand why Daimler paid Zap to go away. Zap stated that they had a couple of YEARS worth on smart production in "dealer sold orders". A Dealer Sold Order is one from a real customer who has placed an order with a deposit. The few dealers that they signed had very limited resources and no service capability. When I visited Zap their "sales" people didn't even know how to fold over a smart passenger seat. This is the car that supposedly got over 60 mpg-Zap was so stupid that they didn't even know how to convert a UK Imperial gallon MPG to a US Gallon and don't even think of them trying to convert smarts European rating of Liters per 100 Km. The funny thing was that the first gen smart car in EPA tests got worse highway mileage numbers than in their city tests because the car was so gutless and the transmission was so LOUSY. I think Zap will probably appeal this to the US Supreme Court to recover the "lost sales revenue" from Daimler's conduct. Hopefully, the Chinese will take over Zap's operations soon. Anybody want to put down a deposit for an Obvio. Steve Schneider is very good at kicking the football farther down the field.
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Chris M 7:03PM (3/01/2008)
I don't know if Zap has a valid "breach of contract" case or not, but it was rather silly of the lower courts to try and claim "they had no jurisdiction". Daimler does business in the US and had a US subsidiary, the alleged agreement was with a US company for sales of product in the US. US courts have jurisdiction over business operations in the US.
Hmm, makes me wonder if Daimler managed to bribe a judge or two...
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kevin 11:46PM (3/04/2008)
Why the dislike for ZAP, they did what M.B. should have done years ago...They showed M.B. that this a viable car here in the USA..."M.B. didn't get it", they took their eye off the ball, they were so concerned with that 'great investment' they made called Chrysler...(They only lost 35Bill on that deal!)
Thank's to ZAP, they woke-up and realized the opportunity they missed with the Smart car. Furthermore, M.B. had no intentions of selling the Smart car in the USA, they were ready to drop production of the car completely.
"Maybe ZAP does deserve something"
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RGW 10:01PM (6/03/2008)
Just been through all the comments..Guess no one gets it..DC's back is against wall..Guess you are unaware of DC grabbing some of the ideas on the Tech on this vehicle from ZAP...Not only wanting to sell but also had a piece of it's making..I do agree the price would be stiff..another reason the car was to be also MADE HERE IN US..to get the price down and use DC's dealerships.....but as normal..big guys stomp on the small ones once they get want they want...sound like another history lesson of the Tucker auto...
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mark 12:52AM (9/19/2008)
Does anyone know what is the status of this case or where i might find information on it............thanks
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