GTS Mark

Interesting article

If you stand back and look at it?no, stand back farther than that, right next to the edge of the cliff?this proposed merger of Chrysler LLC and General Motors, on one level, seems like a splendid idea: Dump half the dealers, half the employees, half the products, and use this supposed $11 billion in cash that Chrysler has sitting around to shore up what is left: the brightest dealers, employees, and products.

Right? Right!

Unfortunately, the only people who could write that scenario with a happy ending for all concerned are Walt Disney and Dr. Seuss, and they don?t seem to be taking on any new assignments.

Which leaves us to help you sort this out. And we at Car and Driver are, of course, public-spirited good citizens, so you can thank us later.

First, let?s look at a couple of key questions:

Will it happen?

Who knows? So many sand traps lurk at the fringes of this green that even if it was announced as a done deal today, there?s no guarantee any sort of merger would be accomplished in the next year; with the amount of credit required for GM to take over Chrysler, there?s little doubt the federal government would be bound to help underwrite the deal, and while the feds seem stunningly willing to apply public funds to private enterprise right now, there is an election coming up, and a guaranteed change in administration, since President Bush has had no luck at all in seeking a third term. And don?t underestimate the legal aspects?the sheer number of lawsuits stemming from suppliers, dealers, and soon-to-be-ousted executives is difficult to contemplate.

Consider this: Mel Karmazin, CEO of the newly merged Sirius XM Radio, says it could take 15 years for a full technical merger of the two satellite radio networks. How long would a complete merger of two big car companies take? (Don?t ask Daimler-Benz.)

That said, Chrysler?s majority owner, Cerberus Capital Management, desperately wants to sell the company to somebody?anybody?be it General Motors or Renault or whichever company can come up with the resources. Since the day Cerberus took control of Chrysler, employees there have discussed among themselves the ?end game??what Cerberus?s long-term plan was. We now know what we suspected then: there sort of wasn?t one.

This year, we have seen companies deemed ?too big to fail? fail. It?s possible we?re entering the era of companies that are too big to succeed.

So if GM and Chrysler don?t merge, what then?

Both automakers could continue to plod along as two big struggling companies, instead of one huge struggling company, but it?s apparent that Cerberus does not relish decades more of what it has suffered through this past year. But this is not a seller?s market, for cars or car companies, as witnessed by GM?s inability thus far to find a buyer for Hummer and Dodge?s inability to sell Viper, although both have been solidly shopped.

http://www.caranddriver.com/reviews/...ysler_car_news

tony286

the big problem with gm has always been waste. When I was 19 I worked for one miserable year at the gm tarrytown plant. We built the Pontiac 6000 and the Buick century and they are basically the same car with different trim.

mynameisjim

This is why I don't understand why big business doesn't fight hard for national health care. GM is the largest health care buyer in the world. What it is it? Like $1500 of every car goes to paying for the health care of past employees. If they, along with other old, big companies could get those people on national health care, they would suddenly be profitable again.

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d-null

haven't Chrysler been making much better vehicles than GM for years?

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tony286

great designs but their quality sucks.

DefaultMan

Interesting read especially since my dad is a GM car sales man. Thanks

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Snake Doctor

Big business is, for the most part, in favor of national health care.

They are even more in favor of tax cuts and less regulation, and to get that they end up with the party that's against national health care.

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doridori

interesting read. thanks

Quagmire

Yeah, but that scenario is the same with all of the big 3. The problem they all seem to have is that they can not seem to separate their luxury lines from their regular cars. Look at the trim and fit and finish in a Corvette and compare it to another sports car. It looks... cheaper in quality. Take a look at the Prowler. That thing was the bastard child of a Chrysler Sebring and Frankenstein.

They were busy building brand loyalty and totally skipped on the product quality. Why is it Hyundai some 'cheap korean' car company can give you 10 years 100,000 mile warranty and the huge US companies can't?

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Twistys Tim

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