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GM looking at Chrysler?

 
 
roger
 
Reply Sat 11 Oct, 2008 12:37 am
If it happens, it's a new kind of world.

Don't know if the URL will work or not.

Quote:
ALERT
from The Wall Street Journal

Oct. 10, 2008

General Motors has recently been in discussions about acquiring Chrysler LLC, according to people familiar with the matter, in a dramatic sign of the pressures mounting on the U.S. auto industry to restructure amid a deep slump in sales.

The upheaval in financial markets has rendered inactive the talks between Chrysler owner Cerberus Capital Management LLC and GM, which wants to shed its stake in GMAC, these people said. However, if markets stabilize, the talks could be renewed because both parties want to move those assets quickly, these people added.

For more information: http://online.wsj.com/article/SB122367931927624611.html?mod=djemalert



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Type: Discussion • Score: 8 • Views: 4,464 • Replies: 32
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farmerman
 
  1  
Reply Sat 11 Oct, 2008 05:49 am
@roger,
Its been a business model for years now to have combined auto malls owned by a single company. SO its already a common sight in the "bicoastal US" to see GM/Chrysler delaers and their several other sub species.Why not combine more than just the credit companies
In our area the GM/Chrysler mall has combined its service division into one super service arena where cars of GM and Chrysler are all worked on and this , the service group, is yet another separate profit center. Thats what Im against because the service centers and the sales are seldom operating with same goals in mind.

The big thing , to me, that makes any US car company a dinosaur is their collective inability to turn on a dime. There is no reason why the "Volt" has to wait 2 more years or that it still takes almost 4 years to go from concept to model. I think design and engineering is in need of a huge shakeup in their ops model. Ford has gotten much better than the others ,but Fords problem seems to be , still, a reluctance to disentagle its majority sales based upon trucks.
0 Replies
 
shewolfnm
 
  2  
Reply Sat 11 Oct, 2008 07:07 am
'slump in sales'

I want to hope that the slump in sales is due to the consumer paying more attention to what they are spending their money on as well.
Ford/Gm products are not a high quality at all.
Argue quality if you like based on comfortable seats, many options and larger engines for cheaper... but when it comes down to it the maintenance of those brands of vehicles is outrageous.
Fords are blowing engines by 120,000 miles.
GM has transmission problems by 60,000 not to mention the tons of small other issues you may have when owning one of them.

Yes, having them fixed is cheap. It is cheap because their parts are everywhere, they are in tow yards, and mass produced causing a super cheap rate for parts.

But as you are taking your truck/car to the shop several times before 150,000 miles, you are driving next to toyotas, hondas, acuras, lexus.. that are just purring right along.

With money getting tighter for the individual family, I wonder if more people are paying attention to quality now then before..

If GM/Ford and all those other brands they produce, step up the quality while keeping their cost low? They would sweep the market up over night.
You get MORe car for less if you buy those brands . Period. Make it a quality product and voila.. instant sales boost..
0 Replies
 
jespah
 
  1  
Reply Sat 11 Oct, 2008 08:05 am
@roger,
If it happens, it may attract the attention of the Feds (anti-trust).
0 Replies
 
edgarblythe
 
  1  
Reply Sat 11 Oct, 2008 08:15 am
@roger,
I had been thinking recently that a merger of the big three might one day soon be in the offing. I may not have been that far off.
Merry Andrew
 
  1  
Reply Sat 11 Oct, 2008 08:48 am
@edgarblythe,
Come ze revolution, it'll all be nationalized anyway. Smile
roger
 
  1  
Reply Sat 11 Oct, 2008 10:17 am
@Merry Andrew,
Now, that's a thought. I'm not sure GM is in any position to acquire anything right now. Could turn from being a giant company with declining sales to an enormous company with declining sales.
0 Replies
 
cicerone imposter
 
  1  
Reply Sat 11 Oct, 2008 11:38 am
@Merry Andrew,
Yup. Rather than bailout three auto companies, we need to only worry about one. I think there's some cost-savings in there someplace.
roger
 
  1  
Reply Sat 11 Oct, 2008 11:53 am
@cicerone imposter,
Laughing Laughing Laughing
0 Replies
 
hawkeye10
 
  1  
Reply Sat 11 Oct, 2008 12:02 pm
I fail to see how combining these two companies helps the us auto industry. The industry is in massive decline and there is a race to cut production capacity and jobs fast enough, and this combination will help with that maybe. But how does it solve any of Detroit's systemic and long existing problems? Does it help to get cars in the showroom faster and cheaper? Does it help them design cars that people want to buy? Does it make the technical quality of the autos they make better? Does it help them develop and access new technology better? Does it help then come up with electric cars or more fuel efficient gas engines? Does it improve the inept management that has existed at the big three for decades?
cicerone imposter
 
  1  
Reply Sat 11 Oct, 2008 12:06 pm
@hawkeye10,
hawkeye, The idea is to cut/reduce administrative costs. This "idea" has been around for a long time; even I considered it when I worked in management.
0 Replies
 
Merry Andrew
 
  1  
Reply Sat 11 Oct, 2008 12:07 pm
@hawkeye10,
Who said the move would solve any problems?
roger
 
  2  
Reply Sat 11 Oct, 2008 12:08 pm
@hawkeye10,
As CI points out, it's economy of scale. If it comes about, there should be less expense involved in bailing out one company instead of two. Really, we trade two companies with serious problems into a bigger company with bigger problems.
hawkeye10
 
  1  
Reply Sat 11 Oct, 2008 12:11 pm
@Merry Andrew,
nobody, but if the move does not help solve Detroit's problems it does nothing for America. If this move only helps the current owners of these two companies navigate the collapse of the American auto industry then we should be up front about that.
hawkeye10
 
  1  
Reply Sat 11 Oct, 2008 12:12 pm
@roger,
You can't bail out an industry that can't produce a product that people want to buy. Unless we impose trade restrictions, is that what you are advocating?
0 Replies
 
roger
 
  1  
Reply Sat 11 Oct, 2008 12:15 pm
@hawkeye10,
Well, like people, companies often act in their own self interest. I'm having trouble guessing where their perceived self interest lies, however. Well, they're rich (in a way) - I own the shirt on my back.
hawkeye10
 
  1  
Reply Sat 11 Oct, 2008 12:22 pm
@roger,
they have said that they will cut many jobs, close many plants, and force many dealers out....thus reducing costs. I wonder though if the idea is to take GM private, and thus take out the pressure on GM to make quarterly profits. GM has a Market Cap of only $3 billion, it is now cheap enough to do this. GM might off load the finance arm as well as stuff like railroad locomotive production, thus be streamlined. This move might make sense for the owners of these companies, but I don't see how it might save them from what appears to be their destiny, which is going out of business. Maybe changes the timeline and the amount of wealth the owners can collect between now and then though.
0 Replies
 
cicerone imposter
 
  1  
Reply Sat 11 Oct, 2008 01:10 pm
@hawkeye10,
But look at what our government is doing now with the bailout of banks and finance companies. It doesn't help those Americans who have lived within their means and have lived responsibly. What's wrong with this picture? Can you see it?
hawkeye10
 
  0  
Reply Sat 11 Oct, 2008 01:13 pm
@cicerone imposter,
I don't see your point re this thread, but you are correct. We have done this over and over again, reward bad behaviour....thus promote bad behaviour. Our culture has for over a generation taught that those who are responsible and who follow the rules are chumps, the actions in Washington over the last month is more of the same.
hawkeye10
 
  1  
Reply Sat 11 Oct, 2008 01:35 pm
@hawkeye10,
I should point out that the policing action for responsibility is accountability. Because we are irresponsible we don't hold people accountable for their behaviour, for their actions.

In order to solve the financial problems that we face we must start with responsibility, with accountability, with no longer looking for the easy answer and the quick fix. Washington over the last weeks has been all about the quick fix....proof that we are not prepared to begin to recover from what ails this society. The financial mess is symptomatic of a larger problem, and until we are ready to admit this there will be no long term fix.
0 Replies
 
 

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