February20
General Motors stands a 50 percent chance of buying Chrysler, Jeep, and Dodge from DaimlerChrysler, according to Merrill Lynch analyst John Murphy, who said such a move would be a “defensive maneuver.”
“Given the transformation the U.S. industry is beginning, we would not rule out a tie-up,” Murphy said in a memo to investors today. “GM may view the acquisition as a defensive maneuver to box out new competition.”
With Toyota’s sales climbing, GM’s “global volume lead is certainly in question,” he said. “The acquisition of Chrysler would certainly allow GM to maintain its crown for many years to come.”
Chrysler could add as much as $9 billion in value to GM due to products and “operating efficiencies including reduced research and development and advertising costs per vehicle,” Jon Rogers, an analyst at Citigroup.
The UAW might also be more willing to make concessions if Chrysler is owned by an American company rather than a foreign one, Rogers said.
I wonder how many layoffs we can expect to hear if this comes to fruition.
Yeah, GM is printing up that play money right now! It has Lutz’s face on the bill.
The gossip continues to build.
Whether it’ll be a good or bad move will be for history to decide, but I sure don’t mind living through what’ll happen either way! It’s bound to be interesting!
I sincerely hope we wake up from this nightmare - if it’s real then I fear for the future of GM and my Pontiac G8 GT. GM just doesn’t look like it’s in a position right now to add brands when it can’t even coherently describe what the existing ones are supposed to be. Cadillac, Pontiac, and Hummer seem to be the only clearly defined divisions, and Saturn’s not too far behind. That being the case.. why add to it? I know HEMI and Jeep seem like attractive prospects, but I can’t see those pros being worth the cons, of which would surely be more heavy and far-reaching, particularly since GM is not exactly profitable in the USA right now. I want GM to make this turn-around one for the history books, but “BOLD MOVES” like this are not the way to do it. Maybe GM should just move out of Detroit before whatever Ford is smoking puts any more of GM’s brass through stupid acid trips. Raise your hand if you already know this kind of story would be far more at home on a Ford thread.
as i said it before on other endless posts about GM/Chrysler—– GM is only looking to increase the volume of cars to stay #1, preventing Toyota from reaching that.
GM doesn’t “GET” it. Its not the volume of cars, its the quality and reputation!! As much as I hate Toyota, i say Toyota deserve the #1 spot.
Combining GM’s and Chrysler’s terrible qualities and interiors are asking for a major trouble!! I hope they merge and chrysler to kill GM off……….
This ‘idea’ is just too big to really be contemplated here. How would GM even consider purchasing Chrysler without charges of monopolziation? Having 2 American auto companies is just bad for the country. Economically it’s horrendous. What if the next down turn is enough to put Ford under? Then there would be one. One manufacturer to rule them all…
Chrysler/Dodge would essentially be absolved. What new niche could there be that Hummer, Saab, Caddilac, GMC, Buick, Pontiac, Chevrolet, Saturn, Holden, and Opel don’t already cover? Keeping them around artificially lowers prices by competeing against each other. The only thing I could see is Chrysler becoming a foreign brand only.
I really don’t care for GM buying Chrysler. This is exactly what is wrong with major corporations these days. And it all gets billed under Capitalism. This is not capitalism, this is greed and corruption.
haha who would have guessed chrysler to tank before gm or ford? damn i lost my bet…oh well hope yall chrysler employees find new jobs soon!
i really dont care what happens as long as nameplates such as Hemi arent diluted and used on GM vehicles.
50/50 means maybe yes, maybe no. What a crock.
well i satnd on this as on both sides i could care less about this but my mom has told me ( she works at GM) she said it wouldnt likly happen for a year or so and thats even if it does happen at all i mean hell but i think that gm will screw something up in the long run
I dont think this will happen…But…
If it did they could have some advantages.
Saturn would still be an import fighter with no change.
1) Buick and Pontiac arent doing so well, so they could turn them into chrysler’s and dodges then phaze out the dying brands yet keep the best products. Dodges would be holdens really.
2) GMC could be paired with Chrysler as a near luxery brand but with trucks (make denali line bigger).
3) Dodge would be the new performance brand.
4) Caddy would maintain top luxery position.
5) Chevy would be the mainstream brand.
6) Hummer would be near luxery SUV’s (a job tey are doing well at)
7) Jeep would be lower end SUV’s (also a job they are doing well at since commander sells poorly).
9) Saab could gain some dodge/chrysler products to fill in its line up….or else just kill it.
A4 I WOULD RATHER SEE THE AMERICAN HEMI IN A CHEVY THAN A CHERRY,GEELY OR SHAINGHAI MOTORS VEHICLES.
Anyone who doesn’t want to see something like a HEMI-equipped redesigned Monte Carlo doesn’t have a heartbeat.
primegtp,how about if buick would have said yes to the statesman then droped a hemi in it?
@Piablo:
Are you forgetting all the other car companies? Toyota, Honda, VW, et al? Even if GM did acquire Chrysler and Ford went under, it still wouldn’t be a monopoly.
Not saying I support the move, just saying it wouldn’t be a monopoly.
Heck…Chrysler is not a major player anyway….
Good point about pricing Piablo.
I think we need at minimum the 3 manufacturers.
Here is some day dreaming for you…Dodge division and Jeep division decide to purchase themselves from the parent corp DC.
Two independant, smaller and hopefully more nimble corps. (and hopefully non union) producing fewer models of higher quality and desireable vehicles.
I know it’s not all that simple but a person can dream cant they?
i think mymazdatribute had the right idea. Mergin the brands would bring alot more technology to GM. Jeep and Hummer would combine, offering low and upscale suv’s. If they combine technology it could benifit GM.
100% chance of that being a bad idea.
stadt - You’re right, it wouldn’t be a straight up monopoly per se. But it would take on monopolistic characteristics. Prices of the foreign competitors are largely modified by tariffs. Tariffs are set to keep the domestic brands competitive. So a Toyota Tundra that is manufactured for $4-$7k less than a Ram or Silverado will have a tariff matching that amount so Toyota can’t undercut Chevy or Dodge. The vehicles don’t have to come in on a boat to be whacked with a tariff either. Now if GM, and Ford maybe, wind up being the only domestic competition, what happens to the price of domestic vehicles? With it, the foreign brands increase prices. Nobody wins. Then of course the door to more government regulation is opened up. As it is, that door is flapping in the breeze, something like this would rip it off from it’s hinges.
Now, the question is, what Detroit crackpot came up with this? If anything, it would be Ford and Chrysler. GM has no reason to merge with Chrysler! It might have been different before Zeta, but not anymore!
^^^ I can’t but agree with you Piablo.. The notion of GM buying Chrysler didn’t sit well with me from the beginning, and when examined from your perspective, I can’t help but feel worse about the whole idea, particularly when experience has taught me that the government would be very liable to act as you describe. I’m certainly no expert in the auto industry, but I don’t think I need to be one to know that this idea is entirely wrong.
Piablo wrote “… So a Toyota Tundra that is manufactured for $4-$7k less than a Ram or Silverado will have a tariff matching that amount so Toyota can’t undercut Chevy or Dodge. …”
The Toyota Tundra is built in Texas. The last time I looked, there is no tariff on products imported from Texas.
S-60-driver wrote “as i said it before on other endless posts about GM/Chrysler—– GM is only looking to increase the volume of cars to stay #1, preventing Toyota from reaching that.”
Just because you said it doesn’t make it so. Whichever company buys Chrysler will do so out of its own corporate interests. If GM buys it without a compelling business reason for doing so, its management will face numerous lawsuits from stockholders.
For those concerned about GM’s financial resources to pull-off this purchase it goes through with it, don’t worry. Smaller companies with substantially fewer resources have made larger purchases. No money need change hands. It is all a matter of the financial arrangements.
If GM doesn’t buy it, maybe Lada will. Can’t hurt.
yay…a daimler-benz return…it would benefit both companies, chrysler is innovative yet cant sell vehilces, gm sells but needs innovation…
Does anyone know how much money GM made in the 4rth quarter? No? A lot.
GM is back.
Buying Chrylser has its good and bad points. If GM can get it w/o the dealers, the retirees fixed cost and most of the work force then it may be worth it. Keep what it wants and sell the rest. Toyota is looking for a few plants.
Dump all the nameplates except Jeep. Turn the minivans into chevies and Buicks. Keep the new mid sized Pick up trucks and SUV’s. Kill GM’s midsize SUV’s and Pickups.
There is no point to combine two struggling, money-lacking companies only to maintain the #1 sales crown. Stupid.
I also believe US regulators would be forced to allow the merger if rumors are true; Without it, Chrysler would undoubtedly fail alone, and a definite global recession would follow.
LOL Can we expect a hemi ss?
I really hope GM buys and resurrects the great EAGLE brand.
.
LMFAO.
That would be bad, if Chrysler products arent very good right now, imagine in the hands of GM, they will kill more brands like oldsmobile and phymouth
Richard and chris2, good points both of you.
while this prospect stands to obliterate my one time perceptions of the big-three’s arch-enemy ambitions, i now realize theyre just companies trying to profit. cant fault that. personally i think it would work on the tech end, but not so much on the marketing and organization end
CAN YOU ALL HEAR THIS SHIP TAKING ON THE WATER? WATCH OUT TITANIC!!
uhhhh yeah me too cts driver…? that was irrelevant and it just looked like you were trying to make some arguement for an unbiased and rational point.
the article says that Chrysler would add approx. $9 billion in value, doesn’t that make it a bad deal when the asking price is $13 billion?
GMnumber1forhowmuchlonger
I don’t get what’s the big deal with holding the #1 “volume crown”. From a personal standpoint, I’d much rather be in Toyota’s shoes and be turning massive profits in the #2 position…heck I’d even like to be a smaller company like Honda with their “disappointing” profits, LOL. I just don’t get why all these articles are so concerned with being the #1 volume leader…who cares really?
Was it me or did someone from GM and Ford say tha killing brand would cost more then to keep then running?
They said they couldn’t afford to kill any brands yet because lack of money yet by buying Chrysler they won’t have any left. Typical GM though it putting its life on the line for that extra couple of years of the number 1 spot. How long before GM are then brought out?
Daimler will be laughing when they have got rid of chrysler. They should then consider doing some sort of alliance (like renault-nissan) with Toyota.
not too long
I hope GM doesnt buy chrysler
Richard - Where do the profits go? Last I looked, Toyota was still based in Japan. You think Uncle Sam taxes Toyota the same as they tax GM and Ford just because they manufacture the vehicle here? If that were true, then we should have seen a price drop right? It’s widely known Toyota manufactures vehicles for less. So without any tariff or tax beyond what GM and Ford have, there should have been a price drop for competitive selling. Now, if there wasn’t a price drop, say due to higher manufacturing costs here in the States, wouldn’t that be a pretty dumb decision to move manufacturing here considering the US is not the only market they sell to?
@Piablo–
The profits go to Japan. That is not the issue. My point is that the Tundra is built in Texas. As such, it is not an import and not subject to import tariffs. Is this concept really that difficult for you to grasp?
Walter Chrysler saved Maxwell Motors to be renamed Chrysler Motors, but I do believe he worked for Billy Durant at one time as well.
Chrysler would be a better historical fit with GM than with anti-semite Henry’s family business.
But I think Mitshi, Hyundai, and Chrysler should form for more than just engines and rename the whole company as such. All are scrappy corporate underdogs, and before flirting with the Germans, they all got along and created solid products.
Ok who will buy Chrysler if the General doesn’t? Who else other than Lutz has any vested interest in doing anything other than shuttering Chrysler?
All of the people saying that GM cannot manage their brands, and adding a clearly defined brand such as Dodge or Jeep to their portfolio is clearly no marketing wiz. Imagine all Hummers renamed Jeep Hummer as in Jeep Rangler.
Richard - Getting a little touchy? Believe what you want. It doesn’t matter if the Tundra was manufactured in DC. Toyota is a foreign coorporation. They are subject to they same foreign taxation whether they are manufactured here or not. They’ve negotiated a reduction because of job creation, but it has not been eliminated. Agree to disagree.
yaeh A4 i didnt even know how to reply to that one, i didnt want to sound biased, but the hemi is an american icon(although jaguar used hemispherical combustion chambers first). it would be like an amg tuned saturn, it would move but not quite be rite with all the mercedes fans. think about if nissan gets the hemi, would the mopar fans be buying a hemi powered maxima? probably not, its the same reason even when dcx had it it never was used anywhere else except in the chrysler group. And since it is better than almost every engine from GM it could be a great new powerplant for pontiac or high performance buicks.
This is just getting out of hand. I’ll just keep watching and listen though not to many, if any, of you guys.
These are the funniest comments on this website in a long time. Excellent.
50-50? Does that mean my transmission in my Generaly Motored out Chrysler Corp car will now die 50% faster or 50% slower? Will my electronics short out and spark 50% brighter as the car dies on the road? Does this mean Chrysler has a 50% chance of living vs dying?
Damn I gave them $20K of my money for a brand new Intrepid, and they blew the money by giving me a piece of crap. I don’t like to say it, but I hope they die.
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