Should GM and Chrysler Merge?

Kristen Stanton
History tells us that 70% of mergers fail, so is a GM takeover of Chrysler really a good idea? I’m curious about what other DS members think. My opinion is – consolidation of big banks, insurance companies, and yes – auto manufacturers - needs to happen in our current economic environment. As tough as it’s going to be, with job cuts and product line cuts, in these times, joining forces and fortifying to create the best of the best of some very big American institutions has to happen. I’m an entrepreneurial/start-up person at heart, but I believe for start-ups to have a chance to grow, the economy needs to be bolstered by some big, strong American companies. Like anything, it’s all in the execution. Here’s a fun site that dares to look into the possible GM/Chrysler product line: http://jalopnik.com/5062950/gm-vs-chrys ... tasy-draft And great info on merger success rates at Google A
Larry Schlagheck
I think a merger of these two would be awful, at best. Simply taking a look at their current product line-up reveals many reasons for the two not to merge (Note: I'm not saying that Chrysler should remain on its own, just that a merger with GM is a bad idea). What value does Chrysler have from a product standpoint? (1) The Jeep brand - which has been watered down significantly. (2) Its minivan platform - which is a sinking vehicle segment. What value does Chrysler have other than product? (1) A production footprint. (2) A ready-made dealer body. Both of which are best suited for a newcomer to the N.A. market like a Chinese or Indian manufacturer. I would also point out that the two "values" listed in this paragraph need massive overhauling. Whichever company merges/buys/takes over Chrysler will have its work cut out.
Kristen Stanton
Wow. Now you're scaring me.
Larry Schlagheck
Here's the new question, Kristen (and the rest of the DS community: Would a Nissan/Renault/Chrysler link-up make sense?
Michael Sweigart
It's like two lepers going to the prom together. Nobody else is going with them, they may as well go together.
Nathan Scripps
I wouldn't go so far as to call GM or Chrysler a leper... Both are certainly hitting rough times... GM is burning through cash and could run out, Chrysler is, well, Chrysler (when was the last time anyone referred to anything Chrysler as cool, sexy, or even buyable?) A merger of the two without government funding would very likely hit the 70% trash pile Kristen mentioned at the start. Funded by the government, the merger could stand for a while, but is that the solution we want? More big business supported by a 'get out of jail free card' sponsored by our tax dollars? Personally, no. $700B plus another $25B already earmarked for automotive is enough for me right now. A good opinion piece on the possible merger was posted October 29th at www.AutoExtremist.com (worth a read... a little bit of doomsday theory, but very sound recounting of US domestic automotive policy as it relates to foreign competition). outcomes of a merge

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