DetN: GM May "Absorb" Chrysler

Robert Farago
by Robert Farago
detn gm may absorb chrysler

Absorb? Absurd! Still, The Detroit News is reporting the GM Chrysler merger deal as if it exists. Which, if true, is one scary ass concept. Well, to most rational people. Which, according to the trifecta of scribes assigned to story, doesn’t include everyone. “Analysts say a deal along the lines of Chrysler’s purchase of AMC, which eliminated Detroit’s No. 4 automaker as an entity and all its brands except Jeep, would make sense for GM.” Huh? Ladies and gentlemen, Aaron Bragman, an analyst at Global Insight: “For GM, the only reason to absorb Chrysler would be to eliminate a competitor.” Yes, but does that make any sense? No comment. So, never mind analysts. Let’s talk to someone in the shadows. “The source familiar with the negotiations told The Detroit News that GM could cut costs by eliminating much of Chrysler’s staff and gradually shifting production of Chrysler vehicles to use more GM components.” THE source? We’re down to one now are we? And is that BS or what? But wait! There’s more!

“At GM, many top executives support acquiring Chrysler, but only in a deal like Chrysler’s acquisition of AMC from Renault.” Many? How many? Who? Look, I’m not saying this is conjecture masquerading as journalism. OK, I am. Especially when I read supporting nonsense like this: “Analysts say a deal along the lines of Chrysler’s purchase of AMC, which eliminated Detroit’s No. 4 automaker as an entity and all its brands except Jeep, would make sense for GM. Such a deal would differ from the 1998 acquisition of Chrysler by Germany’s Daimler-Benz AG, which left the U.S. carmaker operating intact as a separate division. Instead, Chrysler would be completely absorbed into GM and melded into its car making and other operations over time.” The truth is that both automakers are going down. While a merger would be crowning buffoonery in an epic tale of missed opportunties and squandered fortunes, even Detroit execs know that. Don’t they?

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  • 50merc 50merc on Oct 16, 2008

    ajla: "If GM merges with Chrysler, then they can revive AMC, Eagle, and Plymouth." Don't forget DeSoto. There's a lot of pent-up demand for DeSoto. And they wouldn't need to make new commercials; they could just run old clips of Groucho Marx singing "It's de-lovely...." Damned if I can see why GM would want to acquire Chrysler. They don't need the production capacity or the brands or the dealer network. And if GM outlasts Chrysler, it can buy the dies and tools for T&Cs and Caravans at a bankruptcy auction.

  • John Horner John Horner on Oct 17, 2008

    I suspect there is more fire to go with the smoke we are seeing in the press than might seem reasonable. Remember, we are talking about Detroit Suits here.

  • FreedMike This article fails to mention that Toyota is also investing heavily in solid state battery tech - which would solve a lot of inherent EV problems - and plans to deploy it soon. course, Toyota being Toyota, it will use the tech in hybrids first, which is smart - that will give them the chance to iron out the wrinkles, so to speak. But having said that, I’m with Toyota here - I’m not sold on an all EV future happening anytime soon. But clearly the market share for these vehicles has nowhere to go but up; how far up depends mainly on charging availability. And whether Toyota’s competitors are all in is debatable. Plenty of bet-hedging is going on among makers in the North American market.
  • Jeff S I am not against EVs but I completely understand Toyota's position. As for Greenpeace putting Toyota at the bottom of their environmental list is more drama. A good hybrid uses less gas, is cleaner than most other ICE, and is more affordable than most EVs. Prius has proven longevity and low maintenance cost. Having had a hybrid Maverick since April and averaging 40 to 50 mpg in city driving it has been smooth driving and very economical. Ford also has very good hybrids and some of the earlier Escapes are still going strong at 300k miles. The only thing I would have liked in my hybrid Maverick would be a plug in but it didn't come with it. If Toyota made a plug in hybrid compact pickup like the Maverick it would sell well. I would consider an EV in the future but price, battery technology, and infrastructure has to advance and improve. I don't buy a vehicle based on the recommendation of Greenpeace, as a status symbol, or peer pressure. I buy a vehicle on what best needs my needs and that I actually like.
  • Mobes Kind of a weird thing that probably only bothers me, but when you see someone driving a car with ball joints clearly about to fail. I really don't want to be around a car with massive negative camber that's not intentional.
  • Jeff S How reliable are Audi? Seems the Mazda, CRV, and Rav4 in the higher trim would not only be a better value but would be more reliable in the long term. Interior wise and the overall package the Mazda would be the best choice.
  • Pickles69 They have a point. All things (or engines/propulsion) to all people. Yet, when the analogy of being, “a department store,” of options is used, I shudder. Department stores are failing faster than any other retail. Just something to chew on.