NEWS: GM may Acquire Chrysler

[Mcluhan]

File under 'Too Big to Fail'


GENERAL MOTORS IN TALKS WITH CERBERUS TO ACQUIRE CHRYSLER: REPORTS

General Motors held merger talks with Chrysler: reports
By Alexander Davis
Last update: 11:37 p.m. EDT Oct. 10, 2008
Comments: 13
SAN FRANCISCO (MarketWatch) -- General Motors Corp. (GM:
General Motors Corporation reportedly has held preliminary talks to acquire Chrysler LLC, against the backdrop of an increasingly bleak decline for the auto industry. Reports on Friday night by The Wall Street Journal and the New York Times both cited unnamed people familiar with discussions between the two U.S. automakers. GM has been in talks with Cerberus Capital Management LLC, which owns 80.1% of Chrysler and 51% of GMAC, an 89-year-old auto lender that has suffered from its foray into mortgage banking. Cerberus proposed a swap in which GM would acquire Chrysler's automotive operations, and in turn give Cerberus its remaining 49% stake in GMAC, the Journal reported. End of Story

 

[danmand]

File under 'Too Big to Fail'


GENERAL MOTORS IN TALKS WITH CERBERUS TO ACQUIRE CHRYSLER: REPORTS

General Motors held merger talks with Chrysler: reports
By Alexander Davis
Last update: 11:37 p.m. EDT Oct. 10, 2008
Comments: 13
SAN FRANCISCO (MarketWatch) -- General Motors Corp. (GM:
General Motors Corporation reportedly has held preliminary talks to acquire Chrysler LLC, against the backdrop of an increasingly bleak decline for the auto industry. Reports on Friday night by The Wall Street Journal and the New York Times both cited unnamed people familiar with discussions between the two U.S. automakers. GM has been in talks with Cerberus Capital Management LLC, which owns 80.1% of Chrysler and 51% of GMAC, an 89-year-old auto lender that has suffered from its foray into mortgage banking. Cerberus proposed a swap in which GM would acquire Chrysler's automotive operations, and in turn give Cerberus its remaining 49% stake in GMAC, the Journal reported. End of Story

Brilliant idea, two losers combining will sure make a winner.

 

[Mr. Black]

Why would these bozo's want to buy Crapler is beyond me.

 

[WoodPeckr]

Why would these bozo's want to buy Crapler is beyond me.

So they can kick Ford's arse????....

Who the fark knows....this is GM we are talking about!.....

 

[papasmerf]

GM will just screw up the JEEP line

 

[Asterix]

GM to acquire Chrysler. Oh good. The one eyed witch doctor leading the blind. Why they would want to take them on I have no idea.

 

[Mcluhan]

My first thought on 'why' would be to raise capital in the market, create some paper value, create a story.. but then that seems to be counter-intuitive.. On the other side, in the movies after Godzilla gets nuked he thrashed his tail a couple of times before flopping over. The latter seems a more sophisticated analysis.

 

[WoodPeckr]

Just what GM needs now, a new Division or two!....

 

[Mcluhan]

I guess it is better to have a giant dysfunctional company rather than 2 large dysfunctional companies

Ya, buying more too-big-to-fail insurance

 

[anon1]

Smart move. The American auto sector needs consolidation. The first guy to do it has the better chance to survive.

 

[Mcluhan]

Smart move. The American auto sector needs consolidation. The first guy to do it has the better chance to survive.

Eh, this is Cerberus, these are B-School types you are talking about, who are way in over their heads and know nothing about the most complicated manufacturing process in the world... and they are taking a beating from the Japanese on domestic soil...LOL give me a break. All it means is that it's 1 down, 2 to go, if they merge.

 

[Mcluhan]

Another point is, they should have done a reverse take over, and unwound the labour agreements which are killing GM... IMHO

 

[WoodPeckr]

Eh, this is Cerberus, these are B-School types you are talking about, who are way in over their heads and know nothing about the most complicated manufacturing process in the world... and they are taking a beating from the Japanese on domestic soil...LOL give me a break. All it means is that it's 1 down, 2 to go, if they merge.

Could this be the time to jump on some of that GM stock currently at $4.89?....

 

[WoodPeckr]

Another point is, they should have done a reverse take over, and unwound the labour agreements which are killing GM... IMHO

They sort of done that.
Workers pay and many benefits have been cut in half for all new workers and the older workers will have to take the cut in pay over the next couple years.....

 

[Mcluhan]

Could this be the time to jump on some of that GM stock currently at $4.89?....

LOL..you got more guts than me. I made a little machine this week that attaches to the back of my chair, every time i think about buying something in this market, it gives me a head slap. I'm thinking of patenting it.

 

[alexmst]

Well, if Americans who only buy domestic cars currently split their purchases between 3 companies, and there is one less company, then they will split their purchases between the two companies. If one of the two has the product line (at least the part of it that actually sells) of the previous third, chances are they will be the dominent company.

Asterix creates a nice visual metaphor: "Oh good. The one eyed witch doctor leading the blind".

Nobody seems able to turn Chrysler around. Did anybody on here actually think that Cerberus was going to succeed in making Chrysler successful? Ha ha. As for Daimler's merger back in the 90's - that was doomed from day one. Totally different culture - Germans running an American Big 3 automaker? I was LMAO back when the Diamler acquistion "merger" was announced...but not as loud as when Cerberus took control.

 

[Mcluhan]

This is a good read (i love Mish's stuff, its insight on steroids)

GM's Last Fatal Mistake

Here's a meaty excerpt, but there's lots more meat in the article:

" If you thought $4 per gallon was a hit to the wallet, wait until hundreds of thousands of off-lease sport/utility vehicles are returned to dealerships. That's when the whammy of inflated residual values of off-lease sport/utes will hammer the market.

According to Oregon-based CNW Research, with some 800,000 truck-based sport/utility vehicles coming off lease this year, residual values projected three and four years ago will be missed by as much as $6,000 per unit.

Whom will this hurt? Those who lend the money--banks, credit unions, car companies' captive finance arms and others who write leases--will face a tab of nearly $5 billion just in 2008. That number rises to $5.24 billion in '09 and $4.74 billion at the end of the decade. "

 

[Don]

Chrysler is a lost cause (even more so than GM and Ford). Let it die

 

[WoodPeckr]

Chrysler's problem is bad management!
Chrysler just needs to find another Lee Iacocca....

 

[mac]

Chrysler's problem is bad management!
Chrysler just needs to find another Lee Iacocca....

Chrysler hired Nadelli...the ex-GE idiot who drove Home Depot into the ground and walked away with a $100 million package. Why they thought he would be a vaild auto industry maven...i don't know.