Could the unthinkable happen? Might GM absorb Chrysler--and completely eliminate Dodge and Chrysler brands? Maybe just hold on to the Jeep brand, and/or possibly the minivans?
That's one scenario that The Detroit News has put forth.
"That would be the likely scenario, if such a thing were to happen," said Aaron Bragman, an analyst at Global Insight. Besides the Jeep brand and Chrysler's minivans, the company has few assets of value to its bigger rival, he said. "For GM, the only reason to absorb Chrysler would be to eliminate a competitor," he said.
A deal like that would be similar to Chrysler's 1987 acquisition of American Motors Corp. It would allow GM to pick up some of Chrysler's 2.7 million in annual sale, while avoiding the bulk of Chrysler's costs.
kcram says:
05:55 AM, 10/17/08
You've been reading my blog again, Bob? Or is Detroit News? I had that exact same concept last Sunday at The Big Rigs.
rsholland says:
06:13 AM, 10/17/08
Well I think a number of folks have thought this could happen, but this is the first time that I'm aware, that a big time newspaper actually put forth the idea as a "realistic" possibility.
estreka says:
11:44 AM, 10/19/08
While the elimination of Chrysler would benefit all other automakers, the idea that one company should foot the bill is pretty crazy. There must be something there to sweeten the deal. While GM certainly doesn't need the additional dealerships, other companies would pounce at the opportunity. I would suggest that GM be given the option to sell Chrysler dealers to other companies. That might offer some instant cash for the buyout.