Comments on: bailout Watch 504: But Who Will Rescue The Rescuer?

By: Kurt.

Kurt. — Wed, 22 Apr 2009 10:09:51 +0000

The whole Chrysler – FIAT – Opel auto consolidation sort of frightens me. See, if it were just Chrysler heading to C7, no one would care. It would be bad, it would hurt, but it would happen and we would get over it. With GM, who’s too big to fail AND Chrysler, SOMEBODY has to step in to save them or drag the country(s) down with them. Are’nt we just creating another “too big to fail”?

I have this growing dislike for consolidation and “Corporate Socialism”. No one should be too big to fail. I’m no Communist but this is one case where The Gov’t should step in and share the wealth. Make several smaller “independent” companies with different owneers and differnt boards.

By: OldWingGuy

OldWingGuy — Wed, 22 Apr 2009 05:06:05 +0000

I think Windswords is absolutely right.
FIAT picks this up for no-money down and gets some assets.
I wonder if FIAT is a sub-prime automaker?
Hey, isn’t that what started this mess in the first place ? Sub-prime borrowers buying big houses (factories)with nothing down?
Maybe FannieMae or FreddieMac can finance FIAT…

You just know that if a deal is done, the Obama administration will have to keep FIAT-ChryCo limping along until after the second term elections. FIAT-ChryCo will have to start making toilet seats and hammers so the Defense Dept can quietly throw them a few billion a year.

By: tpandw

tpandw — Wed, 22 Apr 2009 02:16:55 +0000

All of this melodramatics is just a slight taste of what we’re to get in another month when the GM ‘deadline’ expires. If it weren’t so sad it would be hilarious.

BTW, I just bought another Subaru (my 7th) yesterday.

By: imag

imag — Wed, 22 Apr 2009 01:31:08 +0000

I scrolled down on this article and saw the title first.

I thought it was going to commence Death Watch: US Gov’t Edition.

By: windswords

windswords — Tue, 21 Apr 2009 23:35:47 +0000

MikeInCanada,

As far as I know, after a C7 there is no more union representation. The company is gone. So if you buy a factory you get to hire whoever you want.

Also the SHAP (Sterling Heights Assebly Plant) in MI is state of the art. Belvedier ain’t bad and St Louis South had a big renovation to build the new minivans before it was shut down a year later. Toluca Mexico (PT Cruiser, Dodge Journey) is also a modern flex plant.

Then there is intellectual property. Engines, like the new Pentastar V6, ENVI projects, etc. And of course Toledo, Jefferson North, and the Jeeps. So yea there’s some good cherries to pick there!

By: MikeInCanada

MikeInCanada — Tue, 21 Apr 2009 18:12:52 +0000

Re windswords :

You bring up a good point Fiat’s might not have the cash to by ChryCo’s assets in a foreclosure sale situation. The question is ‘What are their assets’?

Dealer network, some back office operations (misc admin, marketing), Jeep brand – I can see some value there – however the actual factories; forget it.

Short of renting out the space as toxic or hospital waste dumps what good are any of these facilities?

Now, they are not all dumps. Here in Canada the ChryCo Brampton facility is considered a state of the art manufacturing facility. The problem is that while the building might be considered new to somewhat new, it comes with union that suffice to say ‘is not so new…’

In Canada (please confirm if it is the same in the US) the factory comes with the union. When you buy the real estate, you buy the labor contracts too.

Is it so far fetched to believe that the gov’t would subsidize a Fiat led purchase of some ChryCo assets – if for no other reason to keep a couple hundred dealers open?

By: jpcavanaugh

jpcavanaugh — Tue, 21 Apr 2009 17:58:09 +0000

Once we get the Fiat/Chrysler/Opel/GM company up and running, maybe Daimler Benz can buy it in a “merger of equals” Don’t you all just drool over the synergies and new paradigms? Then we can start all over.

By: Bertel Schmitt

Bertel Schmitt — Tue, 21 Apr 2009 17:42:11 +0000

I retract my previous comment: http://www.thetruthaboutcars.com/say-it-ain%E2%80%99t-so-cerberus-and-opel-pimped-by-berger/

By: windswords

windswords — Tue, 21 Apr 2009 17:19:52 +0000

Don’t jump to conclusions because a European auto analyst who couldn’t even name Chrysler’s lineup is all down for an Opel/Fiat tieup. Of course he likes that idea. It brings him business. Stuff happening in the US/Canada may not.

Problem for Fiat is cost. They don’t have any money. As a matter of fact they are losing money. That’s why they are particulary interested in Chrysler because they get access for free plus a 6 billion dollar low interest loan from Uncle Obama. If Chrysler goes C7, then they have to bid $ on the pieces – money they don’t really have. That’s why I don’t buy the “FIAT should wait for a Chrysler BR and pick it up on the cheap” meme. What if they don’t have the funds? What if they get out bid by another automaker for something they really want (like factories)?

As for Opel, GM is expecting half a billion euros ($649 million) as the minimum for anyone to get Opel. FIAT isn’t going to do that deal.

By: Bertel Schmitt

Bertel Schmitt — Tue, 21 Apr 2009 17:02:07 +0000

The GM rumor had been denounced the same day it was floated:

http://www.thetruthaboutcars.com/editorial-opel-soon-set-free/

By: MLS

MLS — Tue, 21 Apr 2009 16:58:52 +0000

I’m loving the Jaws: The Revenge screenshot. Merely a flesh wound, indeed.

By: mikesdak

mikesdak — Tue, 21 Apr 2009 16:50:17 +0000

This whole thing is endlessly amusing, or would be if such high stakes weren’t involved. As someone old enough to remember FIAT’s bad old days in America, I just can’t see how they can be considered a viable option to even bail out Chrysler, much less help GM, particularly after the previous GM/FIAT debacle. Perhaps GM is trying to get back the money they paid FIAT to go away.