GM buyout of Chrysler?

[unplugged]

CNBC says there are no serious negotiations between GM and Daimler/Chrysler. See the article: CNBC (http://www.cnbc.com/id/17189278)
I wonder what a cross between a Suburban and a Jeep Commander would look like? Anybody want to photoshop that?:eek:

[Steve]

GM has it's own problems, the last thing they need to do it take on another automakers issues. Unless they buy it, plunder the pension, strip it down and sell it off ... never know. :rolleyes:

[terry0341]

Maybee, Chevy, Ford, Chrysler and Dodge should all merge and make the"American Automobile Company"? The only troubles with that is that they all are in trouble and the others may effect the GM quality!

[TrailLeadr]

maybe, Chevy, Ford, Chrysler and Dodge should all merge and make the"American Automobile Company"? The only troubles with that is that they all are in trouble and the others may effect the GM quality!

I'd hate to see that happen. Something tells me no good could come from that. IMO

[Steve]

I'd hate to see that happen. Something tells me no good could come from that. IMO

Who wants to drive an AAC? Aaaaaaaaaaaaaack! smAAC! heart attAAC!

[TrailLeadr]

Who wants to drive an AAC? Aaaaaaaaaaaaaack! smAAC! heart attAAC!
:biggrin::biggrin:LOL:biggrin::biggrin:

[terry0341]

I read your posts and was cracking up! Can you even imagine the NIGHTMARE!!!!!! LOLOLOLOLOLOLOLOLOLO:eek: :biggrin:

[Steve]

What would you call the engines? A 454 Cobra Jet Hemi?

[dwill3015]

Announcing the all-new F-150 Ramerado, or Silver-ram, or Expihoerango, or Subrangodition.

This is turning into a game LOL!

[TrailLeadr]

So would they offer a Dura-stroke engine, or a power-max? in their HD class?

[Steve]

Not to mention the trim packages. I'd like a F150Ramerado with the Eddie Bauer Silverado XLT SLT package please.

[Cableguy]

My father is a GM retiree (maybe you've heard this) but the word on the street is GM wants to stream line the models. Like GMC/Chev models, Pontiac/Chev and so forth. Instead of make 2or3 models of something, make 1 and do it right the first time...I would think that would be a smart start...
what do yo guys think?

[TrailLeadr]

I think it wouldn't be too bad an idea, but some people are just hung up on branding. It might seem like a bit much, but I think they've had the right idea all along. There's no massive cost shift in producing an Avalanche vs an Escalade, and they can still appeal to two different classes of buyers there.

I wouldn't mind having an Escalade, but I'd be damned if I were going to use that to pull my horse trailer, or pick up 30 bags of portland cement for a weekend project. I'd rather use the Avalanche. Maybe it's just me.

[Steve]

Yeah, I agree. When it come to marketing, these guys study everything down to the number of threads in the cloth seats and the way a car smells and what effect it all has on a buyer. To slap a new nameplate on a vehicle does cost some money, plus you have to make new brochures, contracts, dealer relationships, websites, warranties, etc. You have to weight the benefits of additional sales vs. the cost to run all of that mess.

Other comapnies have diversified and when you get too many pieces under one unbrella, it can get too crowded. Streamlining has worked for some, and if you're going to have different brands have them for a reason like quality. Chevy should be base and GMC should be luxury, that sort of thing.

[Cableguy]

Can you imagine a car show that would mean the Ford/Chev/Mopar guys would have to start talking to each other. No more staring contest across the parking lot (you guys know the ones I'm talking about)
The guy with the super bee lookin over at the chevelle guy, with that look of, ya you gotta leave the parkin lot sometime punk.

[TrailLeadr]

Can you imagine a car show that would mean the Ford/Chev/Mopar guys would have to start talking to each other. No more staring contest across the parking lot (you guys know the ones I'm talking about)
The guy with the super bee lookin over at the chevelle guy, with that look of, ya you gotta leave the parkin lot sometime punk.

LOL:biggrin:

Hell would most certainly be frozen over at that point.

[terry0341]

Next thing you know they will start combining sports! OH MY GOD! :eek: Hockaball!!!!!!!!

[Steve]

Source: The Wall Street Journal Feb 17, 2007

Shares in DaimlerChrysler AG jumped to a seven-year high on renewed speculation that General Motors Corp. could buy the company's Chrysler Group unit, a further sign that a spinoff of Chrysler has strong backing among investors.

Several people familiar with the situation said it is unlikely GM would buy Chrysler, although one person with knowledge of the matter said such a deal has been touched on in recent discussions between the two auto makers.

Detroit, New York Abuzz

The rumors created a hullabaloo in Detroit and on Wall Street. Their variety -- touching on everything from acquisition theories to a possible production alliance -- speaks to the difficulty that Daimler may have in managing the process.

GM and Chrysler are discussing joining forces to develop a large sport-utility vehicle (http://www.gminsidenews.com/forums/showthread.php?t=45044#) and possibly a small car (http://www.gminsidenews.com/forums/showthread.php?t=45044#) made in Korea, several people familiar with the matter said, adding that a "production deal" is the most likely scenario.

On Wall Street, the focus also turned to Detroit's labor negotiations with the United Auto Workers. As so much of the industry's future is based around this contract, the issue presents a chicken-and-egg paradox for potential buyers.

Many people discounted the idea of a spinoff, saying that it would do little to fix Chrylser's main problems of cost structure and product appeal. That said, these people pointed out that what is best for the remaining Daimler side of the company may not be best for Chrysler's side.

DaimlerChrysler investors clearly favor the idea of selling Chrysler, long the smallest of Detroit's Big Three and now even smaller than Toyota (http://www.gminsidenews.com/forums/showthread.php?t=45044#) Motor Corp. in the U.S. market.

A deal linking GM, the world's largest auto maker, and Chrysler would likely face many hurdles, including antitrust questions, integration challenges and opposition from workers.

The head of the GM European Employee Forum, which represents GM workers in Europe, said Friday he doesn't believe GM would or should buy Chrysler. "Chrysler doesn't have the right products for the U.S. customer," Klaus Franz said in a telephone interview.


Link: http://us.ft.com/ftgateway/superpage...8365047&page=1



Article from: The Financial Times

By John Reed in London, Richard Milne in Frankfurt and Bernard Simon in Toronto
Friday Feb 16 2007 16:50

General Motors is in exploratory talks with Chrysler after DaimlerChrysler, its German parent, this week said it might sell the struggling US unit.

Other potential suitors for Chrysler, including car companies and private equity groups, have also expressed preliminary interest, insiders told the Financial Times on Friday.

Daimler's US shares rose as much as 6.1 per cent as rumours of the talks emerged.

The Stuttgart-based German-US company made the approach to GM through its bankers after saying it was considering "all options" for Chrysler, which lost €1.1bn ($1.4bn) last year. "Yes, we are in talks," a GM insider told the FT. "They started on Wednesday."

The talks were preliminary, and it remained unclear whether they might result in an offer to buy Chrysler, joint ventures in specific areas, or any deal at all. "We are in a very early stage," the GM official said.

People close to Daimler said there had been "lots of conversations" with several carmakers since the announcement.

"Everyone you can imagine is going to kick the tyres here," said one.

The head of a US investment bank in Germany said a number of private equity firms were in discussion with DaimlerChrysler.

It has hired JPMorgan to advise it on its options. A person involved in the talks said no substantive discussions with any potential buyer had taken place but that a range of carmakers and private equity houses were likely to be interested.

Daimler declined to comment. However, there was a feeling at the company that it did not want to be rushed into anything, and wanted to study all options in detail, from an outright sale to a Chrysler spin-off.

GM said: "We do have discussions with other carmakers with issues of mutual interest, but we won't comment on any speculation of discussions."

GM, which this year is expected to be overtaken by Japan's Toyota (NYSE:TM) as the world's biggest carmaker, last year explored then rejected the possibility of an alliance with Renault and Nissan.

Analysts expressed scepticism on Friday that GM's shareholders would support the idea of a tie-up with Chrysler, the most focused of Detroit's Big Three, at a time when both face declining sales in the world's biggest car market.

GM has not made a full car-company acquisition in its recent history, although, like other groups, it forms ad hoc alliances and joint ventures.

However, "if DaimlerChrysler really want to sell Chrysler, then Rick will have to examine what the potential advantage would be", the GM official said, referring to Rick Wagoner, chief executive.

[abuelito]

well when i hear how bad off companys are its allway a way to cut out a lot of workers and have less baggage,and then hire new people and no baggage,,,gm in bad shape,,thats what the news said,,,and at the same time they bought up over 100 acres in san louis potosi,mexico,,they will build a small town for the new plant they will put in there,they build small houses,,put in water and sewage,put in rail lines and roads,,i dont know what will be going there but i have an idea its the shreveport plant,,when they put in the last assambley at shreveport they didnt weld anything in place all bolted down,,easy to dissasemble,,silo, guanajuato, mexico,makes some of the suburbans,and all of the avalanches,,,you dont see the low cost labor reflected in the mexican made products,,,at silio they built also a small town,,water sewage the whole ball of wax,housing for many of the workers,,,well you gotta give it to them,,they made a good truck the avalanche,but the last few years they are plagued with transmission problems ,especially the 07 models,,,,my yukon xl is made in wisconson,,looking for a good run with it,,,abuelito

[Sandy72526]

I wonder how they'd merge those labor Unions......

[84fiero123]

Wo WHO I own page 3

I wonder how they'd merge those labor Unions......

The unions are all UAW, doesn’t matter who you work for, it’s UAW.

United Auto Aerospace, and Agricultural implement, Workers Union

As far as them ever consolidating to one company.

NEVER.

They are all in trouble because of their own managements inability to listen to anyone.

I saw it every day, give management a suggestion and they just let it go away, until it’s been so long that they can use the idea without paying you for it.

When I worked for GM in the 70’s and 80’s I submitted a suggestion that when they went to front wheel drive, they not eliminate the driveshaft hump in the floor. Keep it and run the exhaust down it to protect it and give the body more structural strength.

They waited till my suggestion was out of date and never paid me for it.

I told them in 85 when I took a 4 cylinder Celebrity home that the car was way to under powered.


They did nothing.

They will not listen to the public, not even their own workers.

[bill_pfaff]

Wo WHO I own page 3



They are all in trouble because of their own managements inability to listen to anyone.


They will not listen to the public, not even their own workers.

It isn't just the automakers. I'm in computers and all to many times I have seen management bring in the "Experts" to at best have them say the same thing we were telling them for months or more or at worst lie and rip them off by leading then down the rosy path. You know who I'm talking about. The ones that wear a suit, come from 50+ miles away, and charge $200+ an hour.

I had an employer pay 50 million + dollars over 5 years to a "Consulting" firm to implement an ERP system (software package). After they failed for the second time my employer came to us (the employees) and asked if we thought we could put it in. We told them we could have had it in production three years earlier and they gave us 9 months and one shot to do it.

The package has been running like a clock for seven years now and as a pay back they just contracted with another "Consulting" firm to the tune of 70 million for an implementation of another component of the software.

Go figure. We calculate three years and we will be asked to go it alone again with our “know nothing” staff.

And they wonder why this country is going to hell in a handbag.

[TrailLeadr]

It isn't just the automakers. I'm in computers and all to many times I have seen management bring in the "Experts" to at best have them say the same thing we were telling them for months or more or at worst lie and rip them off by leading then down the rosy path. You know who I'm talking about. The ones that wear a suit, come from 50+ miles away, and charge $200+ an hour.

I had an employer pay 50 million + dollars over 5 years to a "Consulting" firm to implement an ERP system (software package). After they failed for the second time my employer came to us (the employees) and asked if we thought we could put it in. We told them we could have had it in production three years earlier and they gave us 9 months and one shot to do it.

The package has been running like a clock for seven years now and as a pay back they just contracted with another "Consulting" firm to the tune of 70 million for an implementation of another component of the software.

Go figure. We calculate three years and we will be asked to go it alone again with our “know nothing” staff.

And they wonder why this country is going to hell in a handbag.

I'm guessing that part of that has to do with the company's image. If for some reason you guys couldn't pull off the job, it's going to make the company look incompetent. But if they subcontract and it fails, they can say in the face of PR that they tried, but it was not really their fault, and place the blame squarely on the contractor. I think it's because it's easier for them to not bother to get to know what kind of talent that have on their own team, so instead they play it safe at the cost of blowing some $$ on the project.

That's just my take on it. I may be wrong.

[Steve]

The problem with consultants is the hourly rate. We have seen the same thing.

For example, the company that I work for makes an inventory/distribution package, we do very well for auto parts companies. We just signed a very well known company (resurected) that made a stylish car in the 1980's that was featured in a movie with Michael J. Fox. :-) Anyhow, this company hired a consultant to review our software and the market, to a tune of something like $200/hour. Our software cost them like $10,000, the consultant cost them like $18,000 and they said to go ahead and put our system in becuase we can do what they want.

[bill_pfaff]

Who knows what lurks in their minds.

It's just very demoralizing to the staff. We watch all this money go out the door and when it comes to pay increases they mysteriously have no money.

We all talked about quiting once and coming back at the $200+ per hour rate but hay, SOME of us still have ethics.

I'd say it was just me and my old fashioned ways but when we took over the project there wasn't one person that didn't forfeit vacations and put in an untold number of unpaid hours in OT to make it happen. Actually it was quite refreshing to see the younger employees right in there with us "more mature" individuals.

[Steve]

Everything that I've read on this is that Chrysler has been nothing be a net POSITIVE for Diamler. Looks like maybe they raided the cash that Chryslter had and will sell it off w/o cash if they can. But it was a money maker for Diamler over the past few years.

[Steve]

http://www.canada.com/nationalpost/financialpost/story.html?id=32f3a2bc-3551-4f1f-8c75-3cceef8c7579&k=39152

American billionaire Kirk Kerkorian's investment firm Tracinda Corp. has sent a letter to DaimlerChrysler AG's supervisory board, offering to buy its Chrysler unit for US$4.5-billion in cash.

Tracinda said it was prepared to post a deposit of US$100-million "in order to demonstrate its good faith." In exchange, it wants exclusive right to conduct due diligence on Chrysler's business for 60 days.