G.M. and Chrysler Explore Merger

G.M. and Chrysler Explore Merger

www.nytimes.com

DETROIT — General Motors is in preliminary talks about a possible merger with Chrysler, a deal that could drastically remake the landscape of the auto industry by reducing the Big Three of Detroit automakers to the Big Two.

The talks between G.M. and Cerberus Capital Management, the private equity firm that owns Chrysler, began more than a month ago, and the negotiations are not certain to produce a deal. Two people close to the process said the chances of a merger were “50-50” as of Friday and would most likely still take weeks to work out.

(visit the link for the full news article)



[edit on 10-10-2008 by grimreaper797]

I'm currently watching CNBC right now as they discuss the issue. It is interesting to note that Chrysler isn't exactly fairing wonderfully either. It would definately be a major change in the auto industry.

I have to wonder, has this economic downturn been manipulated in a way to push weaker companies into mergers? Perhaps an attempt to monopolize multiple markets? (auto, banking, etc.)

Many on this board believe that this crisis was manufactored. Could that be a possible reason for it? Attempting to monopolize the market, even with the help of the government via helping create merger deals could be possible.

www.nytimes.com
(visit the link for the full news article)

Chrysler, Dodge, Jeep, Chevy, Pontiac, Saab, Saturn, Hummer, Caddy?

sounds like a good combination if you ask me. all though i can almost predict the line of dynamic differences between these models shrinking, i still think its not a bad a idea.

im an industry outsider, but i have been rocking my S-10 for years.

I posted the same article in another thread.
I'm also not sure how this is going to pan out. I really like both but both together might be like oil and water.

This definitely makes me wonder if it is all manufactured. Just how everything is merging and the world financial powers meeting and supposedly discussing a one world currency and what not. Although this isn't too surprising because I believe this has been discussed before during other economic downturns, but if it actually happens or one just decides to just go bankrupt... that would be something of significance. I'm personally worried about what Ford will do, I highly doubt they would want to merge with them but with the way things are going it could happen.

[edit on 10-10-2008 by asmall89]

reply to post by grimreaper797


WOW, this is a huge story!

The US auto industry has been it shambles for they last 5 years or so., but I would never have guessed this was even a possibility.

The more amazing aspect is the big 3 have been failing for years and have taken only small and incorrect strides to improve thier products.

I understand that the auto industry is one of the largest employeers in the country and if they vanished it would be devestating.

I was always taught that if a company makes an inferior product they will go out of business. Isn't that a basic foundation of capitalism?

I love american cars do not get me wrong I own 3 classic chevys at the moment but,

With that said modern american cars are AWFUL! I mean they are horribly built pieces of junk that fall apart after the first 3000 miles.
and I'm talking about $60.000 cadillacs. Compared to thier Japanese and German counterparts they are incredibly poor examples of modern automobiles and a laughing stock.

The fact that these companies have not put out a decent product in years says a lot about what they think of consumers and thier management. Why should i support a company that could care less about what they try so hard to sell to me?

This merger is a VERY sad sign of how dire the situation has become and how incompetent they are.

Its very simple make a good product and people will buy it.

[edit on 10-10-2008 by drock905]

This is nothing new. Only different circumstances.

Feb 16, 2007

They have been failing because of a doctrine of profit that prevents them from actually investing in the future. It's more cost-effective to convince us to keep buying the crap they design using media, than to invest in anything that might reduce revenue flow, like longer-lasting materials, alternative energy. etc.

In a world of finite resources, this brand of corporate culture kills the goose that lays the golden egg, every time.

I suppose it goes without saying that this will be deemed 'necessary for the economic well-being of the country' and will create a semi-nationalized motor vehicle industry monopoly.... or am I being paranoid.

Originally posted by Maxmars
I suppose it goes without saying that this will be deemed 'necessary for the economic well-being of the country' and will create a semi-nationalized motor vehicle industry monopoly.... or am I being paranoid.

really though the stock market dictates towards this sort of everyone owns everything mentality.

still, im sure ford will opt a nice resistance.

however, if big brother wants to give me a "hoverboard" ill take it.

everyday that passes shows the amount of industries that the powers that be are now shareholders of.

More than likely this will lock down another electric vehicle design for GM.
Chrysler/Dodge has 3 electric vehicles in the works and plans to bring one out in 2010 to compete with GM's new Volt. GM may use this opportunity to quickly build a portfolio of electric vehicle designs, as well as put a HEMI on a Vette or the redesigned Camaro.

I wish GM would get rid of their financial wing and get back to cars. An analyst said one time, "GM is a financial company that builds cars on the side". That speaks volumes about where their real focus is.

From the Source

The auto industry is being pummeled from all sides — by high gas prices that have soured consumers on profitable S.U.V.’s, by a softening economy that has scared shoppers away from showrooms, and by tight credit that is making it difficult for willing buyers to obtain loans. Both G.M. and Chrysler have been struggling with product lineups that are out of sync with consumer demand for smaller, more fuel-efficient cars.

The problem is clear G.M. and Chrysler are out of synch with market demands due to the reasons given above ,failure to tap into overseas markets and they are subsidised rather then operate in the Free Market . A merge could only be beneficial if the new company operates in the Free Market which would force it to cater to market demands .

This Dodge is the electric sport concept. While the Chevy Volt gets 40 miles to the charge with a gasoline backup motor, the ZEO has a range of over 250 miles on a single charge.

Seems Dodge put a little more thought into their electric car. If GM does take them over, hopefully they won't bury it.

www.greencar.com...

American cars are crap, If they come out with new electric or hybrids they will still be crap. Ford gm and chrysler dont understand this. The management is clueless.

Other then a home, a car is the biggest purchase people make. American autos are a joke, when you have alternative makes why would you buy American? There is no benefit.

The companies assume there would always be brand loyalty so they have no reason to make a quality product. Unfortunatly for them they are WRONG.

Consumers will not put up with US auto compainies anymore. These talks are evidence of that.

If it wasnt for the huge amount of jobs they are responsible for I would be happy to see them disappear, they are a automotive disgrace.

A merger between GM and Chrysler would likely mean the death of Chrysler.

There is far too much "Product Overlap" between the two companies to allow the Chrysler lines to continue as more or less direct competeors to the mulitple GM products.

When Daimler(Mercedes)-Benz bought Chrysler a few years ago, the two companies' products clearly occupied completely different segments of the automotive market. In fact, broadening their low(er)-end market penetration was the reasoning behind Daimler's acquisition of Chrysler.



But Daimler soon discovered that Chrysler was nothing but a money pit.

Certainly Chysler was home to some hot designers, virtually creating the "Neo-Retro" design fad with the Prowler, the PT Cruiser, and the supposedly "mini-Bentley-esqe" 300. However Daimler-Benz had always based its industry/market reputation on innovative Engineering, not just style.

And since sound engineering costs, there was no way effectively "cross-pollenate" the strengths of one company to the other without diluting both firms: Chrysler design was too flashy and fad-ish for D-B products, and D-B engineering was too expensive to incorporate into most Chrysler designs.


With GM, Chrysler products occupy many, if not all, of the same markets niches. It would be both inefficient and fisaclly irresponsible (especially in a tight economy) to allow products, which directly compete with those that you've paid to develop and market, to continue in production.


If GM acquires Chrysler, Chrsysler's innovative "design to prodution" methodology will probably be one of the few elements to survive the transition; that and one or two other assets. But, as for the rest (like all those production line and administrative jobs); Say Bye Bye.



No Mo' MOPAR!