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Old 10-12-2008, 02:50 PM   #1
racer98
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OMGHi2U GM/Ford and Chrysler to add new garbage.

http://www.nytimes.com/2008/10/12/bu...f1c&ei=5087%0A


Oh yah what a great **CKING idea.


So what will happen to the SRT lable ? will that be offerd in a Cobalt now I think I can get any otter to run GM better then any one else in the past

R0bman ?

Another bright idea by Rick the bong smoking wagner & bob putz. nothing bob's,putz & lutz like a GM product

Quote:
G.M. Said to Seek Merger With Ford Before Chrysler
Quote:
DETROIT — Before General Motors began exploring a possible merger with Chrysler — talks that first came to light on Friday — G. M. proposed a similar deal with its other cross-town rival, the Ford Motor Company, two people with knowledge of the talks said Saturday.

G. M. executives approached Ford about a possible merger in July, but Ford rejected the idea and ended the discussions last month, these people said.

After Ford decided to remain independent amid an increasingly difficult auto market, G. M. turned its attention to Chrysler. For the last month, it has been in preliminary merger talks with Chrysler’s owner, the private-equity firm Cerberus Capital Management.

People with knowledge of the talks described the chances of a deal as “50-50.”

The behind-the-scenes maneuvering illustrates the mounting pressure on the Big Three Detroit automakers to solve their enormous financial problems and stave off bankruptcy.

A G. M.-Chrysler merger, if it were to occur, would have a wide-ranging impact on the American auto industry at one of the most critical points in its history.

Both G. M. and Chrysler are losing market share in the United States and burning through billions of dollars in cash while they scramble to revamp their unprofitable North American operations. But they may be running out of time. With auto sales at their lowest level in 15 years, both companies face the possibility of bankruptcy before their turnaround efforts take hold.

“These are not normal times,” said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Mich. “The biggest problem is cash and whether these companies will have enough to survive this downturn.”

For G. M., which lost $15.5 billion in the second quarter alone, the strategy for survival appears to center on pursuing a mega-merger.

In July, G. M. approached Ford with a proposal to combine the operations of the two biggest American automakers. The talks involved several meetings between G. M.’s chairman, Rick Wagoner; its president, Frederick Henderson; Ford’s executive chairman, William C. Ford Jr.; and its chief executive, Alan R. Mulally, people with knowledge of the process said.

Ford broke off the talks in September, these people said. Mr. Ford and Mr. Mulally were said to have concluded that their company had a better chance to reorganize on its own than in tandem with another automaker.

A Ford spokesman, Mark Truby, declined Saturday to confirm the discussions with G. M., but he said Ford was determined to remain independent.

“What we can say is that we are convinced our best opportunity is to continue to integrate Ford and leverage our global assets,” Mr. Truby said. “That remains Ford’s focus.”

Talks between G. M. and Cerberus may take weeks to complete, and they could still be derailed by price issues and the challenges of integrating G.M. and Chrysler. The companies have held numerous meetings involving senior management on both sides but have yet to delve deeply into each other’s financial books and sales projections.

Cerberus is also talking with other automakers about a potential Chrysler deal, including Nissan Motor of Japan and Renault of France, people with knowledge of the situation said.

Chrysler executives have already struck some deals on products and manufacturing plans with competitors, including a deal to provide a pickup truck to Nissan in exchange for Nissan building a small car for Chrysler.

A Chrysler spokeswoman, Lori McTavish, declined Saturday to discuss any merger talks with G. M. but reiterated the company’s strategy to grow through partnerships.

“As we have said, the company is looking at a number of potential global partnerships as it explores growth opportunities around the world,” Ms. McTavish said. “Beyond those partnerships already announced, however, Chrysler has not formed any new agreements and has no further announcements at this time.”

Chrysler has struggled in the United States market since Cerberus acquired an 80.1 percent stake in the company for $7.4 billion last year from its previous owner, Daimler of Germany.

Chrysler has cut thousands of jobs, slashed production and closed plants to try to balance the impact of a 25 percent drop in United States sales so far this year. But Chrysler has a substantial amount of cash, which probably would be of great interest to G. M.

As a privately held company, Chrysler is not required to disclose its financial results. In August, however, Cerberus said that Chrysler had about $11 billion in cash reserves.

The merger talks between G. M. and Chrysler are playing out against a backdrop of radical downsizing by all three Detroit automakers. Since 2006, the companies have cut a total of more than 100,000 hourly jobs in the United States, leaving them with about 130,000 blue-collar workers in their home market.

But the companies have also experienced significant erosion in their sales in the United States. Last year, G. M. sold 3.82 million vehicles, compared with 4.81 million five years earlier. During that same period, Ford’s sales have fallen to 2.5 million from 3.57 million, and Chrysler’s sales have dropped to 2.07 million from 2.2 million. By contrast, Toyota’s sales in the United States have grown to 2.62 million last year from 1.75 million in 2002.

Andrew Ross Sorkin contributed reporting from New York.
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Old 10-12-2008, 02:53 PM   #2
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Who Cares?
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Old 10-12-2008, 03:04 PM   #3
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People need to understand something about automotive manufacturer acquisitions. Models will not be shared. The only aspect that gets combined and consolidated is resources... Parts storage facilities, logistics departments, vehicle preparation centers, HR departments, etc. Revenue is created by combining resources to offer twice the product, at a reduced overhead cost.
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Old 10-12-2008, 03:07 PM   #4
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People need to understand something about automotive manufacturer acquisitions. Models will not be shared. The only aspect that gets combined and consolidated is resources... Parts storage facilities, logistics departments, vehicle preparation centers, HR departments, etc. Revenue is created by combining resources to offer twice the product, at a reduced overhead cost.

yeah and lots of people axe and canned.

oh forgot to mention all of the f2 visa new employees comming over from China and India
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Old 10-12-2008, 03:08 PM   #5
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Who Cares?
either way you will eventually.
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Old 10-12-2008, 03:09 PM   #6
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the cobalt is clearly an srt4 in disguise anyway. might as well get the correct badge on it.
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Old 10-12-2008, 03:42 PM   #7
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Originally Posted by DrinkAV8 View Post
People need to understand something about automotive manufacturer acquisitions. Models will not be shared.
Models are shared all the time. Especially by GM.
Saab 9-2X/WRX
Saturn Sky/Opel GT/Pontiac Solstice/Daewoo G2X
etc...

I figure chevy will come out with a mondeo before too long.
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Old 10-12-2008, 04:57 PM   #8
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R0bman ?
No. No "R0bman." Please ingest a gallon of kerosene and sneeze on a hurricane match whilst standing in giant bowl of sterno.
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Old 10-12-2008, 05:10 PM   #9
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Isn't Chrysler owned by Daimler? Why are they talking about GM merging with just Chrysler? Is Daimler getting rid of Chrysler?
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Old 10-12-2008, 05:12 PM   #10
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Daimler got rid of Chrysler a while ago.
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Old 10-12-2008, 05:20 PM   #11
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Originally Posted by racer98 View Post
yeah and lots of people axe and canned.

oh forgot to mention all of the f2 visa new employees comming over from China and India
good, that is exactly what they need. get the costs down from all those stupid unions.

Everyone on this forum is MASSIVELY against most american vehicles but there are quite a few cars that I'm interested in in almost every segment.
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Old 10-12-2008, 05:26 PM   #12
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WT2DA:
http://forums.nasioc.com/forums/show....php?t=1614888

GM has been bankrupt, on paper, for quite a while. Delpi could still sink them, and worthless full-size SUV's coming off lease could still sink GMAC too.

GM had enough cash to keep going for about 9 quarters at their burn rate last quarter. That was before credit dried up, and with delaying their big payment to the UAW's pension fund...

With the government loan guarantees they received they might survive. They'd do better with a partner though (they'd get a bigger chunk of the loans).
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Old 10-12-2008, 05:26 PM   #13
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Quote:
Originally Posted by gramicci101 View Post
Models are shared all the time. Especially by GM.
Saab 9-2X/WRX
Saturn Sky/Opel GT/Pontiac Solstice/Daewoo G2X
etc...

I figure chevy will come out with a mondeo before too long.
You are missing the point completely. That was due to original planning, not an acquisition.
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Old 10-12-2008, 05:27 PM   #14
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Daimler got rid of Chrysler a while ago.
Diamler sold a portion of stock, just enough to give the majority share to Cerebus.
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Old 10-12-2008, 05:40 PM   #15
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Originally Posted by DrinkAV8 View Post
Diamler sold a portion of stock, just enough to give the majority share to Cerebus.
Daimler didn't sell Chrysler, it practically paid someone else to take Chrysler off their hands. (see Cerberus Group.)

http://money.cnn.com/2007/05/14/news...sale/index.htm

Quote:
Daimler pays to dump Chrysler
German automaker will end up actually paying $650 million to unload Chrysler to end its exposure to billions in ongoing losses, health care costs.

By Chris Isidore, CNNMoney.com senior writer
May 14 2007: 3:39 PM EDT

NEW YORK (CNNMoney.com) -- DaimlerChrysler moved to undo the most expensive and one of the least successful mergers in auto industry history Monday as it agreed to essentially pay to dump the money-losing Chrysler unit, which it paid $37 billion for nine years ago.


DaimlerChrysler (Charts) announced it will sell an 80 percent stake in its U.S. brand to Cerberus Capital Management, a private equity investment firm that will pay $7.4 billion.
chrysler_logo.03.jpg
DaimlerChrysler sells majority stake of its struggling U.S. brand for $7.4 billion to Cerberus Capital, a New York-based private equity group.
john_snow.03.jpg
Former Treasury Secretary John Snow is the current Chairman of Cerberus Capital.
The Chrysler plant in Newark, Del., one of the assembly lines that it plans to shut in an effort to cut capacity and stem losses.
The Chrysler plant in Newark, Del., one of the assembly lines that it plans to shut in an effort to cut capacity and stem losses.
DaimlerChrysler Chairman Dieter Zetsche.
DaimlerChrysler Chairman Dieter Zetsche
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But the German automaker, which will be renamed simply Daimler, will not actually get most of the money that Cerberus is paying for the once proud automaker. Instead Cerberus will contribute $5 billion to the Chrysler auto operations it will now control, with just a bit more than another $1 billion going to Chrysler's finance arm.

While Daimler will receive the remaining $1.4 billion of Cerberus's capital contribution to the sale, Daimler expects to have to cover another $1.6 billion in Chrysler losses before the deal closes. So Daimler estimates that it will end up paying out about $650 million to close the deal and that its earnings for 2007 will take a $4 billion to $5.4 billion profit hit because of charges related to the transaction.
Crucial cars for Chrysler

What Daimler gains from the deal is closing the door on ongoing losses and liability for future health care costs, for Chrysler's unionized employees and retirees, estimated to be as high as $18 billion.

Shares of DaimlerChrysler were up 2.7 percent in late trading in Frankfurt and up nearly 2 percent in late-morning trading in New York, although that is off from earlier gains soon after the announcement. Even coming off the highs of the day, shares of the company have risen nearly 30 percent in the three months since it announced it was looking to sell Chrysler.

The private equity sector has become a major force in the acquisition of publicly owned companies in recent years, often buying troubled operations at a bargain price.

"We are aware that Chrysler faces significant challenges, but we are confident that they can and will be overcome," said a statement from John Snow, the chairman of Cerberus and the U.S. Treasury secretary from 2003 to 2006. "A private investment firm like Cerberus will provide management with the opportunity to focus on their long-term plans rather than the pressures of short-term earnings expectations."

This is not Cerberus's first entry into the troubled U.S. auto industry. Last year it bought a 51 percent stake in GMAC, the finance unit of General Motors (Charts, Fortune 500), and it is in negotiations to become a major investor in Delphi (Charts, Fortune 500), the world's No. 1 auto parts maker, which has been in bankruptcy since October 2005.

The German automaker then known as Daimler-Benz paid $37 billion for the U.S. automaker in 1998, but it soon found itself weighed down by uncompetitive labor costs and lost sales to nimbler Japanese rivals.

Toyota Motor (Charts) passed DaimlerChrysler in U.S. sales for the first time 2006, as GM, Ford Motor (Charts, Fortune 500) and Chrysler all lost money on their North American operations and announced plans to close plants and make deep cuts in staff.

The U.S.-based automakers such as Chrysler, which includes the Chrysler, Dodge and Jeep brands, have been hurt by high gasoline prices over the past year and a half; they depend much more on sales of light truck models, such as SUVs, pickups and minivans, than on the more fuel-efficient car models, where Japanese automakers dominate U.S. sales.

About three out of every four vehicles that Chrysler Group sells in the United States is a light truck, the highest percentage of any automaker. But sales of light trucks have seen their overall share of the U.S. market fall, to 53 percent in 2006 from nearly 56 percent in 2004.

The newly independent automaker, to be known as Chrysler Holding, will begin debt-free, as its former German parent, now to be known as Daimler, assumes its debt. Daimler will also retain a 20 percent stake in Chrysler Holding.

But the U.S. automaker, which is projected to not return to profitability until at least 2008, will take with it responsibility for billions in health care coverage promised to union employees, retirees and their families, costs than are adding thousands of dollars to each automobile made in North America.

On Feb. 14, as DaimlerChrysler announced it would look at all options for Chrysler, including a possible sale, at the same time it announced plans to cut 13,000 jobs in closing an assembly line in Delaware and a parts center in Cleveland while eliminating shifts at other plants. That same day the company announced that Chrysler losses reached $1.5 billion in 2006, even as DaimlerChrysler made $7.3 billion in the period.
Ford family may give up control

Chrysler attracted interest from a number of other private equity firms, as well as Canadian auto parts marker Magna International (Charts). In addition, financier Kirk Kerkorian, who had been the largest shareholder in Chrysler when it was sold to Daimler-Benz, offered $4.5 billion for Chrysler, proposing to share ownership of the company with its unions and management. But that bid never appeared to be taken seriously by DaimlerChrysler.

Still over the past three months pressure from German shareholders to dump the unit mounted in the face of the prospect for future losses in North America. At the company's annual shareholder meeting in April, major institutional shareholders pushed for a sale.

"We're confident that we've found the solution that will create the greatest overall value - both for Daimler and Chrysler," said a statement from DaimlerChrysler Chairman Dieter Zetsche. "With this transaction, we have created the right conditions for a new start for Chrysler and Daimler."

Zetsche did admit during the news conference that DaimlerChrysler had a made a mistake in overestimating the cost savings that could be obtained by combining luxury carmaker Daimler with mass-market automaker Chrysler Group. He also said that the Chrysler buyer wasn't willing to pay the premium for the advanced features and technology that were being developed by Daimler for its Mercedes Benz brand.

But he defended the original decision to go forward with the purchase of Chrysler, arguing that it was impossible to know the shortcomings of the combination in advance. And Zetsche, who had been in charge of Chrysler before being named chairman of the parent company last year, said it was personally very difficult for him to sell the Chrysler unit.

The United Auto Workers union, which had previously stated opposition to the sale of Chrysler to a private equity firm, issued a statement Monday backing the deal.

UAW President Ron Gettelfinger said the union leadership "concluded that the transaction with Cerberus is in the best interest of our membership, the Chrysler Group and Daimler. We are satisfied now that the decision has been made so that our membership and management can focus on designing, engineering and manufacturing the finest quality products for the future success of the Chrysler Group."

Snow said he was gratified by the support that the UAW voiced for the deal and argued that Cerberus's ownership of Delphi will be good for the union and its members since it will help Chrysler to succeed long term.

"I think Cerberus has a good record of working with companies that are organized. We respect the role of organized [labor] and we appreciate the support that UAW has given this transaction," he said.

But Cerberus has seen its investment plans at Delphi stalled as management there has not been able to win a new labor deal in prolonged talks with the UAW. And the next five months will include a new round of difficult negotiations at Chrysler over issues such as health care costs for both active employees and retirees and their families.

The UAW contracts with Chrysler, GM and Ford all expire in September. The sale to Cerberus could close about the same time, as Zetsche said it is expected to close in the third quarter. Top of page
Crucial cars for Chrysler
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Old 10-12-2008, 05:41 PM   #16
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Originally Posted by obyone View Post
Daimler didn't sell Chrysler, it practically paid someone else to take Chrysler off their hands. (see Cerberus Group.)

http://money.cnn.com/2007/05/14/news...sale/index.htm
I work for Daimler!
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Old 10-12-2008, 06:01 PM   #17
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No. No "R0bman." Please ingest a gallon of kerosene and sneeze on a hurricane match whilst standing in giant bowl of sterno.
**** man you would be perfect for the job to work at GM , Anger /rage / just a 10th shy of going postal in you're cubecle - man with that rage we might see an STI-ZR1 cross over from your rage
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Old 10-12-2008, 06:40 PM   #18
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I work for Daimler!
Which makes you entirely unqualified to post anywhere near this thread.

LEAVE NOW!!!
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Old 10-13-2008, 12:37 AM   #19
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The BEST thing that could EVER happen to Ford, GM, Chrysler USA is that they go under. This empowers them to come back as Ford Motor Car instead of Ford Motor Company etc etc. It flushes the crap from the company (upper, middle, lower management) rids the companies of the UAW, and allows them to actually start making money in their home markets instead of depending on the rest of the world to keep them afloat.
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Old 10-13-2008, 12:46 AM   #20
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If they went under my neighborhood would turn into a ghetto overnight. It is pretty scary how many communities around her completely depend on Ford and Chrysler to barely keep their head above water.
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Old 10-13-2008, 12:52 AM   #21
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Old 10-13-2008, 01:02 AM   #22
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If any of the Detroit automakers went under, we wouldn't be using the word Recession to describe the economy - it would be Depression.

Like it or not, but they are a HUGE chunk of the American economy (sure, not as big as they used to be, but still huge) - GM alone employs something like 150,000 people directly... probably 10x that amount indirectly. Any of the Detroit automakers going under is simply not an option.

Of course GM buying up Chrysler is simply a dumb move - both are very weak automakers with a ton of overlap, and almost all that overlap is in the same declining markets. Makes no sense to merge 2 companies that would bring essentially the same failings to the table. If GM bought Chrysler simply to get a bigger chunk of the $25B government loan, even that doesn't make much sense either.

What's worse is that these merger rumors distract upper management at a time when they should be focusing on improving their damn products - GM is getting lots better, but obviously not fast enough.
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Old 10-18-2008, 07:11 PM   #23
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OMG, Otters were going to have 31 flavors of Vanilla now that GM and Chrysler are set to merge. I just only see Chrysler & teh Mopar getting axled and products evetually becomming GM.


Quote:
DETROIT (Reuters) - U.S. automakers Chrysler LLC and General Motors Corp are pushing for a quick merger deal ahead of the U.S. presidential election as sales continue to plummet and they cannot gain access to credit, a Detroit newspaper reported on Saturday.

According to The Detroit News, senior executives at GM and private equity group Cerberus Capital Management -- which bought an 80.1 percent stake in Chrysler from Daimler AG for $7.2 billion in August 2007 -- are keen to wrap up talks before both automakers are weakened further by a sluggish U.S. economy.

Both companies have been losing money. Analysts have estimated that GM is burning through at least $1 billion per month. The credit crunch and the economy have made major banks reluctant to lend to the industry.

A Chrysler spokeswoman said the company would not comment on the newspaper report. GM officials did not respond to a request for comment.

Both parties are racing to conclude a deal before the election, which is 17 days away on November 4.

There has been speculation within the industry and among analysts that if Detroit's automakers face failure, they may seek a bailout from the U.S. government along the lines of the recent $700 billion package for the financial sector.

It is unclear whether the government would support such a rescue package, but both presidential candidates -- Democratic Sen. Barack Obama of Illinois and Republican Sen. John McCain of Arizona -- may be more likely to promise help for the industry before Americans head to the polls.

The U.S. auto industry accounts for thousands of jobs in Michigan and Ohio, and the latter remains a key battleground state in the upcoming election.

The newspaper report said under one possible scenario, GM would absorb Chrysler to get hold of its cash stockpile -- $11.7 billion on June 30 -- then shut down some of its brands and car dealerships in order to cut costs dramatically.
http://www.reuters.com/article/topNe...49H1IT20081018
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Old 10-18-2008, 07:22 PM   #24
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Yeah, merge with Chrysler, raid their piggy bank, then merge chevy trucks and dodge trucks into GMC - drop the duradud and mate the cummins to the allison, then drop buick, chrysler, and pontiac. Chevy should be the sporting car brand, Dodge should be the family car brand, Jeep should be the SUV brand, GMC should be the truck brand, and Cadillac should be the luxury car brand. Have I missed anything? Oh, foreign brands - sell them off? Bring over US versions of good foreign cars?
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Old 10-18-2008, 08:50 PM   #25
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Originally Posted by Hazdaz View Post
If GM bought Chrysler simply to get a bigger chunk of the $25B government loan, even that doesn't make much sense either.

GM wants Chrysler because even though Chrysler lost the largest percentage of sales of ANY US automaker last year they also have that largest amount of cash reserves of any of the three. Around $11bn, and considering it is speculated that GM will reach its minimum operating budget of $14bn next year an $11bn CASH injection would help. Also GM would be getting rid of their remaining 49% stake in GMAC which has been partially crippled by the sub-prime mess. GM would own 100% of Chrysler as Cerebrus is in talks with Diamler to aquire Diamlers remaining 18.9% stake in Chrylser, which would then be sold off to GM.
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