DaimlerChrysler Outsources Corporate Systems To EDS

EDS says it has secured a contract to manage the servers and software that power some of automaker DaimlerChrysler Corp.'s key Michigan-based customer and employee operations. Neither company would reveal the length or value of the contract. However, an EDS spokesman says the deal is one of the largest that the IT service provider has signed this year.

EDS will help DaimlerChrysler consolidate its server infrastructure in an effort to reduce the cost and complexity of its IT operations. "It's a chance to lower our fixed costs," a DaimlerChrysler spokesman says. Among other things, EDS will take on operation of the automaker's DealerConnect dealer-communication system and its Employee Dashboard human-resources system. The EDS spokesman says all of the work outsourced to EDS will be performed in the United States.

The deal should help EDS's automotive-services business at least partly offset declining sales to General Motors Corp., its largest customer. In reporting its first-quarter results Monday, EDS said revenue from GM during the period fell to $503 million from $566 million a year earlier, a decline of 11%.