Rumor: GM and Chrysler in merger talks & other shakeups

Blind_Io

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http://news.bbc.co.uk/2/hi/business/7664866.stm

US car giants General Motors and Chrysler are in talks about a possible merger, US media say.
Reports say the talks have been going on for a month but details of the deal vary from a merger to an acquisition by GM of Chrysler.
GM is the leading manufacturer and Chrysler third after Ford. All have been suffering with a plunge in US sales to 15-year lows.
Neither of the parties have made any direct official comment.
Ford move
Sources told the Wall Street Journal that Cerberus Capital Management, which owns 80.1% of Chrysler had proposed trading its automotive operations to GM in return for GM's stake in the auto lender GMAC Financial Services.
The New York Times's sources spoke of a merger that was a "50-50" possibility, although it could take weeks to finalise and had been stalled by the turmoil in the financial markets.
GM spokesman Tony Cervone said: "Without referencing this specific rumour, as we've often said, GM officials routinely discuss issues of mutual interest with other automakers."
Analysts have questioned Chrysler's position, given its reliance on North America for 90% of its revenue.
Both companies have been hard hit by falling truck and SUV sales and are struggling to push through job cuts against union opposition.
GM shares hit a 60-year low this week. It posted a second-quarter net loss of $15.5bn.
Separately, Reuters reports that Ford is planning to sell most of its 33.4% holding in Japan's Mazda.
I guess Cerberus decided it's time to let the Sick Man Of Detroit go.
 

fbc

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That last line grabs my attention too - you mean after selling off Jag & Land Rover, Ford are now considering off-loading their stake in Mazda?? Seems like yet another short-term decision without much long-term forethought - i.e. one they'll regret in years to come.
 

Blind_Io

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I was thinking that too, fbc. They have borrowed so much from Mazda for the new line, it seems a shame to sell it off. Of course they took quite a bit from Volvo too...
 

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That last line grabs my attention too - you mean after selling off Jag & Land Rover, Ford are now considering off-loading their stake in Mazda?? Seems like yet another short-term decision without much long-term forethought - i.e. one they'll regret in years to come.

Ford's got a bunch of new supposedly competitive product coming in the 2010/2011 timeframe, roughly 24-36 months from now.

The problem is that they only have 18 or so months of cash left and nobody will lend them more. They need to raise more cash from somewhere.

GM is in a similar quandary.

If Ford do sell a large share of their bit of Mazda, I wonder who will buy it? Tata?

Here's one out of left field - Hyundai, maybe? Hyundai's Kia has a lot of ties to Mazda already.

I just hope the European branch of Ford survives, since they actually make cars you would want to buy.

The irony is that more than eight years ago, Ford had figured out they needed to bring those over to the US to compete with the imports, but then decided not to.

They had eight years after the Mk1 Focus came out to do something. They did nothing - except give us more useless cars like new Tauruses.
 

'CruiserMan

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Well, if we get a major merger of the US car makers, the result will be something not entirely unlike Leyland, nationalised or not. It'll be interesting to see how it plays out.
 

Spectre

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Yeah, but as long as the government stays out of it, it has a chance to succeed. If the government nationalizes it, you might as well just close the doors and avoid the long painful slide to the bottom and the massive drain on tax dollars (as well as the souring of investors and venture capital for anything automotive.)
 

MacGuffin

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That last line grabs my attention too - you mean after selling off Jag & Land Rover, Ford are now considering off-loading their stake in Mazda?? Seems like yet another short-term decision without much long-term forethought - i.e. one they'll regret in years to come.

Ford might not survive long enough to regret that...

I wonder how many blows those three car makers can still take. Frankly I'm waiting till the first of the three goes into administration.
 

smib

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The irony is that more than eight years ago, Ford had figured out they needed to bring those over to the US to compete with the imports, but then decided not to.

They had eight years after the Mk1 Focus came out to do something. They did nothing - except give us more useless cars like new Tauruses.

:yes:
It always amazes me so see the differences between market variations on vehicles. America's are pretty much always ugly as sin, and always lacking on interiors compared to the others. Another thing, fuck off to anyone that says Americans won't buy diesel, everyone knows that we will buy anything if you tell us it's better than something else. Advertise how much cleaner diesel is now and tout the mpg ratings and you will see plenty of sales. Might also be a good idea to make sure they have a nice exhaust note and put that in the ads as well.
 

Cobol74

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Chrysler has even beaten Cerberus - who'd have thought. Europe Ford, and GM actually make OK motors. Good diesel technology, nicely built and fair value for money, well over here anyway. I think that the UAW may have finally priced themselves out of the market and you may see lots and lots of plant closures coming - just like us really. The only plants that survive here (UK) are the ultra modern non unionised ones - they tend to be Japanese - Honda, Nissan and Toyota.
 

argatoga

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And that worked out SOOOO well the last time that was tried... British Leyland, anyone?

What about Renault? ;)

Anyway GM would get Jeep (good) and a whole lot of redundant shit and brands (bad).

Ford is better selling off Volvo than its share in Mazda, the latter has been tied to Ford's hip since the 70s and it has been to Ford benefit (think small engines and car platforms).
 

thedguy

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If ford sells Mazda, they are THROUGH

If Mazda is sold to say...Hyundai, Mazda will probably do a lot better than they do now under Ford.

How Ford expects to survive without Mazda though is beyond me, they rely on them for most of their small engine development and most of their platforms are heavily Mazda influenced.
 

Eunos_Cosmo

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If Mazda is sold to say...Hyundai, Mazda will probably do a lot better than they do now under Ford.

How Ford expects to survive without Mazda though is beyond me, they rely on them for most of their small engine development and most of their platforms are heavily Mazda influenced.

I meant Ford would be through. And yeah, before Mazda, all Ford had in the V6 range was their Windsor based 3.8 and 4.3 liter pushrod garbage motors. Mazda gave them the fabulous KL range, along with many 4 bangers.


If Mazda is forced to make it on its own, I can foresee them canning their rotary program to cut costs :(
 

Momentum57

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Ford's got a bunch of new supposedly competitive product coming in the 2010/2011 timeframe, roughly 24-36 months from now.

They had eight years after the Mk1 Focus came out to do something. They did nothing - except give us more useless cars like new Tauruses.

First off they always say they are new and competitive products yet they are never that competitive are they. Worst off it will come too little too late I think the American Motor industry in general is fighting for a losing cause.

That being said have you been in the Ford Five Hundred/Ford Taurus they are quite nice and very well put together. The problem is in comparison to the Toyota Camry well...
 

Wizegui

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...=the design of the Camry is definitely more modern and interesting, but it feels very cheap compared to the Taurus. Hard plastics and bad fittings are found throughout the new car. Ijust don't understand how Ford can design such a boring looking interior... And to think that during the late eighties and early nineties, they had a car that was literally ahead of the competition.

 
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