NYT: GM's Barra Declined Meeting With FCA's Marchionne to Discuss Possible Merger

Mark Stevenson
by Mark Stevenson
nyt gm s barra declined meeting with fca s marchionne to discuss possible merger

Sergio Marchionne sent Mary Barra a detailed email in the middle of March in an effort to start merger talks. Barra, CEO of General Motors, was uninterested in the offer and rebuffed Marchionne, CEO of Fiat Chrysler Automobiles.

It was the first time the two executives had ever spoken, but it wouldn’t be the last Barra would hear of Marchionne’s merger desires.

That’s the story being told by the New York Times today, detailing the lengths to which Marchionne is going to trigger consolidation within the automotive industry.

During a routine analyst conference call on April 29, Marchionne brought his plea to other executives through the media with a 25-page PowerPoint presentation.

“I think it is absolutely clear that the amount of capital waste that’s going on in this industry is something that certainly requires remedy. A remedy in our view is through consolidation,” Marchionne said.

Marchionne’s overture of a merger with GM includes no less than 14 brands between North America and Europe, not including the many other brands each company markets in China and other emerging regions. But, to date, the overture has been played to an audience wearing earplugs.

Even with the vast number of brands, that isn’t what bothers Marchionne. Instead, it’s the amount of money poured into redundant R&D work that could be shared by multiple automakers.

“It’s fundamentally immoral to allow for that waste to continue unchecked,” he said.

[Source: New York Times]

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7 of 115 comments
  • Johnny ringo Johnny ringo on May 25, 2015

    The last time General Motors and Fiat tried some kind of a joint venture, General Motors ended up giving Fiat two billion dollars to go away. Maybe Sergio is trying to repeat that deal again in the hope of getting another cash infusion. Hopefully, GM has learned from its errors; it sounds like Ms. Barra wants no part of Sergio or his schemes.

    • Lichtronamo Lichtronamo on May 25, 2015

      Why Johnny Ringo, you look like somebody just walked over your grave. Ms. Barra ain't no Dick Wagoner.

  • TonyJZX TonyJZX on May 25, 2015

    I actually like a lot of FCA cars, even more than GM. However I find all this very embarrassing and demeaning for FCA. Why would they ever even consider this? GM of all places? Would FCA be better off streamlining or getting rid of or selling unproductive assets?

    • See 1 previous
    • Pch101 Pch101 on May 25, 2015

      At this point, Fiat doesn't have much to streamline. It needs more customers. Yes, I suspect that any partnership with GM would be centered around Opel-Vauxhall. But now that GM has backed away from its global Chevy/ Koreacentric strategy, it now sees Opel as being worth keeping -- I doubt that Marchionne is unaware of this, but it can't hurt him to ask. I suspect that the real target is PSA. That might actually be doable at some point.

  • Sjalabais Sjalabais on May 26, 2015

    A crappy car behemoth like that would probably face obstacles also from competition watchers in the governments concerned?

  • TW5 TW5 on May 26, 2015

    FCA's only hope is to lobby for a $1/gallon federal gasoline excise tax as a replacement for CAFE 2025. They don't have the technology portfolio to reach the standards. It's not even close.