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Report: GM in Talks to Buy Chrysler

Automotive News reports that GM is in negotiations to buy the foundering Chrysler group in its entirety. Neither company would comment on the report.

Worldwide Chrysler Group retail sales decreased by 5% in 2006 to 2.7 million units. As a result of the lower volumes and a weaker US dollar, the Chrysler Group’s revenues for the year of $62.2 billion were significantly lower than in 2005 ($66.1 billion). The Chrysler Group posted an operating loss of $1.475 billion in 2006, compared with an operating profit of $2.024 billion in 2005.

At the earnings conference call this week, DaimlerChrysler Chief Executive Dieter Zetsche said that all options were open for the Chrysler Group.


John Ard

Why on Earth would GM want to buy Chrysler? Their product lines are nearly identical! I think a better buyer would be VW or Nissan/Renault.


Wouldn't that be the non-swimmer trying to save the drowning man? I always thought that Daimler and Chrysler were a lousy mix of cultures. I'm sure neither party responded all that well to the particular foibles of the other.


I cant think what GM would do with Chrysler , now they have revised their landfill policy what would they do with all Chrysler´s unsold gas guzzlers!


Can you believe this , just heard on PBS radio that the two companys are in talks to jointly produce a new large SUV !


They will lose less money on every truck sold, but make it up on volume.


2mode hybrid system equiped vehicles. BMW is also onboard.


Two years ago Chrysler was keeping Mercedes' boats afloat {operating profit of $2.024 billion in 2005}. Chrysler needs to jetison Daimler and go back to doing what made them so attractive prior to the '98 takeover.

Harvey D.

Could GM-Ford-Chrysler survive as ONE regrouped company? That would make a lot of gas guzzlers to reform, but it may be unavoidable.

However, since all three suffer from the same mis-adapted sickness, the same cure may work.

One group could produce energy storage-charging units, the second group could produce the drive trains and GM could produce the chassis-bodies. Of course, production of all components and sub-assemblies could be outsourced to (China, India, Brazil, Mexico etc) to reduce cost and remain competitive.

One dozen local, geographically distributed, plants for final automated assembly should be enough.

Steve Patterson

GM is already a huge corporate mess unable to produce a vehicle for US sales that can compete with the likes of smaller Toyotas & Hondas (Yaris, Fit, Nissan Versa, etc...). The last thing they need is the dead weight of Chrysler.

American auto execs simply don't let their designers create good small cars. They get into committee think and we end up with oversized vehicles requiring large engines resulting in poor fuel economy. Chrysler Group's Dodge Caliber is interesting in form -- much better than the Neon --- but it cannot come close the mileage of my Scion xA.


In 2006 GM run losses of about 300$ per vehicle sold, compared to 1200$ loss for vehicle sold for Ford. GM is about to flip itself profitable this year.


I like John Ard's suggestion of a VW/Chrysler partnership. No "Merger of Equals" like MB said of their takeover in 98, but a partnership between VW and Chrysler where Chrysler is its own company again.

VW could supply Chrysler versions of their Rabbits, Jettas, and Passats, along with their own VW deisel expertise, and Chrysler would fill in VW's void of Pick-ups, SUV's, and minivans. I think I read a year or so ago that VW is having Chrysler design and build a minivan for them already. That deal may have fallin through however, I'm not sure.


I think Daimler splitting from Chrysler was only a matter of time. How could the American UAW faithful put up with German management over the long haul? Could they really put up foreign management at all? I think it's either American management, or else the company eventually folds - or partially folds with the only surviving division being Jeep (and even Jeep is facing fierce SUV competition). GM-Chrysler is the only realistic, long-term option here. However, if GM bought Chrysler and preserved its status as the world's largest automaker, dark days would still be ahead (via plant closings, brand elimination, etc) because there would be less incentive for GM to transform into a viable competitor of Toyota.


Another more risky option would be with private investors, like Kirk Kerkorian and others who would want to take on GM, Ford and everyone else. They could turn into a David vs. Goliath(s) environment, like Apple vs. IBM. I don't see foreign management ever really working. The key would be in the execution - with innovative, relevant, progressive, distinctly American products. However, alternative energy powered vehicles would be critical, which are obviously developing in a variety of ways - but no suite of profitable technologies exist yet for deployment on a large scale.


Here's completely off the wall ... Chrysler and Tesla (and venture vehicles too). Chrysler plants and marketing, inovative products. Nah! ... never happen.

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