GM Chrysler Merger News

WASHINGTON — Leaders of President Barack Obama’s auto task force will travel to Detroit next week to meet with industry and labor officials worried about an imminent collapse of several companies absent federal aid.

An administration official said final details of the trip were still being worked out, but the task force visitors will include advisers Steven Rattner and Ron Bloom.
The task force has been conducting a string of meetings over the past two weeks to gather information and assess the depth of the problems facing the industry. General Motors Corp. and Chrysler LLC have said they need a total of $7 billion before the end of the month to avoid bankruptcy, and several suppliers are also on the brink.
Fiat Chief Executive Sergio Marchionne met with Rattner, Bloom and other members of the task force for two and a half hours today to discuss Fiat’s proposed alliance with Chrysler. Fiat has said it would take a 35% stake in Chrysler in return for sharing vehicle designs that could be used for several new Chrysler models.

Buy The Domain Name Auto Task Force—www.autotaskforce.com

Article from The Detroit Free Press-GM Chrysler Merger part of Chrysler Viability Plan!

Chrysler LLC, which is pushing forward on an alliance with Italian automaker Fiat SpA, said it believes a partnership with General Motors Corp. is still the “best option for the U.S. auto industry.”

The comments came in Chrysler’s restructuring plan filed late Tuesday with the Obama administration.

In the plan, Chrysler, which has already received $4 billion in federal loans, details its restructuring efforts, which include the elimination of 3,000 jobs and three vehicle models, as well as its request for $5 billion more in federal loans.

But Chrysler’s plan also points to consolidation among U.S. automakers as a way to sustain the industry.

GM., which received $13.4 billion in federal loans, did not express that sentiment in its restructuring plan filed Tuesday.

Sen. Bob Corker, R-Tenn., who has been a critic of the domestic auto industry, said it’s clear that Chrysler’s best option is to partner with another automaker.

“Whether it’s with Fiat, or whether it makes sense to talk about GM, a merger is their best chance for survival,” he said in an interview with the Free Press.

Chrysler hints at a “strong need for industry consolidation, as it notes a merger with GM would create more value than a standalone Chrysler or Fiat alliance,” Barclays Capital analyst Brian Johnson said in a note to investors Wednesday.

The Auburn Hills automaker is clear that the savings from a GM-Chrysler partnership would be at least five times more than what a deal with Fiat would offer.

Chrysler has said that discussions about such a partnership, which gained steam last fall before the two automakers approached Congress for aid, were taken off the table by GM.

But as GM and Chrysler approach the government for more money, decisions about the future might not be in their hands alone. Johnson said he expects government aid will continue, “with perhaps the condition of a merger of Chrysler into GM.”

However, Corker said it wasn’t clear whether a GM-Chrysler pairing would make sense, given the need for GM to cut jobs, plants and brands.

“If you look at what GM is trying to do, which is simplify, does it make sense to add to it?” Corker said. “It’s a question that needs to be asked in light of the changes that have occurred.”

A merger between GM and Chrysler would generate at least $36 billion in cash and boost operating earnings by $40 billion, Chrysler said.

Savings would come from combining purchasing power, as well as operations for manufacturing, sales and marketing research and development and corporate staffs.

The prospect of a GM-Chrysler merger met criticism across the Midwest, where one study said the combination would cost 35,000 jobs, including as many as 25,000 jobs in Michigan alone.

Promoting a plan that would lead to thousands of job cuts could be a political landmine.

In its plans to the government Tuesday, GM said it plans to cut 47,000 jobs worldwide this year while Chrysler plans 3,000.

And the tally could rise if either automaker is forced to file for Chapter 11 protection.

“The prospect of losing 25,000 jobs in a consolidation between General Motors and Chrysler seemed outrageous in October. Right now, it seems like the best-case scenario,” said Patrick Anderson, principal at the East Lansing-based Anderson Economic Group, which studied the potential merger. But Anderson said amid weak vehicle sales, it would be harder to realize all of the cost savings a merger would ordinarily deliver…..More

The latest news reported by Fox 2 Detroit:

GM will not ask the UAW for wages concessions.

Probably due to the fact that the last contract in 2007 included wages concessions. The new UAW assembly employees will earn around $14 dollars an hour.
Remember the new car czar will have to approve the companies plan. More than likely the czar will demand pay cuts.

Chrysler Says It Won’t Sell Pieces of Company—Do You Believe it?

DETROIT — Chrysler LLC on Wednesday shot down fresh speculation the auto maker is considering selling off pieces of its operations amid increasing concern about its ability to survive.

In a hastily organized conference call, Chrysler President Tom LaSorda said reports the company was in talks about selling its Jeep brand and other key assets are “absolutely false.”

Chrysler is “going to be around for a long time,” he said. “We are not going under.”

Mr. LaSorda said he couldn’t say if Chrysler’s majority owner, Cerberus Capital Management LP, was considering selling the company as a whole.

The latest report from reuters has Magna and Nissan buying up pieces of the company.

Another Chrysler sell off article!

Jeep To Renault-Nissan, Belvidere To Magna Steyr, PT Cruiser To China. Maybe

Chrysler has been - some say desperately - seeking to “sell key assets” for a while. The Nikkei (sub) now says that Chryler might be getting close. The usual “unnamed people with knowledge of the discussions” whispered that Chrysler is talking to Nissan-Renault and the Canadian auto supplier Magna. The topics of the discussion are the Jeep brand and Chrysler’s Belvidere plant. The Jeep brand would go to Renault-Nissan, Magna would take the plant.

The parties aren’t strangers.

Chrysler had announced an alliance with Nissan last April.

As for Magna, the interest probably stems from Magna’s subsidiary Magna Steyr, which is creating more and more auto contract manufacture business. Magna Steyr has produced the Chrysler Voyager from 2002 to 2007, and currently produces the Chrysler 300C, the Jeep Commander and Jeep Grand Cherokee. Magna was one of the bidders for Chrysler when it was sold by Daimler in 2007.

According to Reuters, Chrysler has been in talks with Chinese automakers Chery and Guangzhou Automobile Industry Group Co, to sell them the PT Cruiser “brand” and tooling.

Of course, nobody will officially confirm that anything is true. Reuters says that representatives of Chrysler, Cerberus, Magna, and Nissan declined to comment. A spokeswoman for Renault denied talks were under way.

Reuters say there is reason for secrecy and plausible deniability: Renault-Nissan is looking to see whether a deal to acquire Le Jeep would hurt access to U.S. government funding. Good thinking.

[For the uninitiated: an asset sale is when you sell what's owned by the company without selling the company-- and the liabilities that go with it.]

The White House has decided to come to the rescue of General Motors and Chrysler by providing them with $17.4 billion in low-interest loans to keep them afloat, ABC News has learned.

The money for the loans will come from the Troubled Asset Relief Program fund, signed into law this fall to bail out the financial industry. The president will provide $13.4 billion in short-term financing in December and January and plans to make another $4 billion available in February, provided it can reach into the second half of the $700 billion TARP fund to do so.

The deal also includes as a non-binding “target” a key provisions, including making work rules and wages competitive with workers at foreign car companies in the U.S.

Chrysler CEO Bob Nardelli issued a statement saying the company was grateful for the helping hand and that, “Chrysler is committed to meeting these requirements.”

Pressure had been building for President Bush to act. Chrysler temporarily shut down all of its plants earlier this week to save money, and GM delayed construction on a new plant for the same reason. And House Speaker Nancy Pelosi urged Bush on Thursday to make a decision because the nation’s weakened economy could not risk a massive wave of layoffs.

“This is a difficult time for a free-market person,” Bush said Thursday. “Under ordinary circumstances, failed entities, failing entities should be allowed to fail. I have concluded these are not ordinary circumstances, for a lot of reasons… We got to the point where if a major institution were to fail, there is great likelihood that there’d be a ripple effect throughout the world, and the average person would be really hurt.”

Treasury Secretary Henry Paulson told a business forum in New York Thursday night it was too risky to simply let the automakers fail.

“When you look at the size of this industry and look at all those that it touches in terms of suppliers and dealers… it would seem to be an imprudent risk to take,” he said….More

Chrysler owner Cerberus is now willing to give away some of its stake in the automaker, Wall Street Journal reports.

LONDON (CNNMoney.com) — Ailing automakers General Motors and Chrysler have restarted merger discussions, according to a report in the Wall Street Journal.

The newspaper, citing people with knowledge of the talks, said Chrysler owner Cerberus Capital Management reopened the discussions and has suggested it is more willing to give up part of its ownership.

A Chrysler spokesman told CNN he could not confirm this story. GM did not immediately return a call for comment.

Merger talks between the two automakers collapsed a few weeks ago but the reopened discussions could be a way for Chrysler to show Congress its willingness to cooperate in the restructuring of the auto industry, the report said.

Chrysler, GM (GM, Fortune 500) and Ford Motor (F, Fortune 500) have approached Washington for aid to help them get through the current financial crisis. A congressional effort to establish a stopgap, $14 billion loan program to help Chrysler and GM at least until next month collapsed in Congress last week.

Chrysler announced late Wednesday that it is stopping all vehicle production in the United States for at least a month due to “continued lack of consumer credit for the American car buyer.”

Slowing sales have forced all of Detroit’s Big Three automakers to suspend operations in January
..More

GM Chrysler News reported this 2 months ago. The GM Chrysler Merger was and is a done deal! They just need some cash to buy out Daimler and then transfer the 49% of GMAC to Cerberus and GM will Get Chrysler’s assets.

I find it amusing all these supposedly automotive experts are surprised that GM Chrysler is talking merger again. Both companies have told us 2 months ago they where going to merge. The only hold up was GM needed more cash! Well guess what, the money will be coming soon.

The auto rescue bridge loan was all part of the plan to facilitate the GM Chrysler Merger!

GM idled 22 factories and Chrysler idled 30,Sadly the workers at GM and Chrysler do not know that some of these plants will never open up again, Especially if the GM Chrysler Merger goes through.

GM Chrysler News-J.F.–Website

DETROIT (Reuters) - United Auto Workers President Ron Gettelfinger on Friday blamed Senate Republicans for the collapse of the auto bailout bill and said the union was ready to do its part to prevent creditors from forcing General Motors Corp or Chrysler LLC into bankruptcy.

“We’re going to work tirelessly to make this happen and realize that there’s going to have to be restructuring,” Gettelfinger told reporters.

Gettelfinger said the key now is to prevent suppliers from stopping shipments to GM or Chrysler or demanding payment in cash up front — a situation he likened to “a run on the bank.”

“We need to satisfy the suppliers that there is going to be a tomorrow,” he said.

Without immediate federal help now by the White House through the $700-billion fund for the banking system, GM will not be able to make it out of December, and Chrysler’s own dire cash position is similar, he said.

“If we worked for nothing, it wouldn’t help them limp into January,” Gettelfinger said.

Senate negotiations over a $14 billion package to extend emergency loans to the auto industry broke down late Thursday. That came after the UAW balked at requirements from Senate Republicans that would have forced the union to agree to sweeping concessions on the spot.

“We wondered, quite frankly, if we were just being set up,” Gettelfinger said.

The UAW has been a stalwart ally of the Democratic party and worked hard for the election of President-elect Barack Obama.

Gettelfinger said some Republicans, particularly from southern states like Alabama, saw the bailout negotiations as a way to cripple the union while aiding the Japanese, South Korean and German automakers that have located plants and supply operations in their home districts.

“They thought perhaps they could have a twofer here maybe — pierce the heart of organized labor while representing the foreign brands,” he said….GM Chrysler News blog

Yes, now we know how little the rest of America cares for Detroit, Michigan and The America Auto Industry! We have been beat up time and time again by the US media and international media, but never did i think Americans of the South and West hated us so much.

What is more important for Detroit and Michigan is that we remember who we are! We are the salt of the earth hard working people, we are the people that built the tanks and planes that crushed the Nazi regime from taking over the world, we have made the vehicles and engines that have been used to advance our society.

We may dwindle and fade from our glory years, but with the right vision we will rise again.

We must begin a new era of renewed commitment of quality, efficiency and innovation.
We should not strive to be on par with the Japanese automakers, we need to beat them in every aspect of the game.

A large part of their success is because the Japanese Government fully backs the Japanese Autos! We need the legislation in place to make it more difficult for Japanese and foreign transplants to use our tax dollars to fund their plants and ship their profits back to Japan.

You now see how crucial the America Industry is to the foundation of this country.

We must ask and demand all those who live in Michigan, Ohio, Indiana, Illinois and other major American Manufacturing States to return their foreign cars.

If you know of Television or radio personalities who drive foreign cars don’t watch and don’t listen to them.

If you do watch or listen to them this is only reinforcing their belief that driving foreign cars doesn’t matter. The same for shops,restaurants and any other establishment you spend your money at.

If they do not support you and your family, don’t support them!

Gm Chrysler News

Under the purposed deal the ” Car Czar ” will make all the decisions! The “car czar” will have the power to force U.S. automakers into bankruptcy! He will be incharge of distributing the $15Billion as he see’s fit! He could also force the GM Chrysler Merger!

This is the Government taking over GM and Chrysler or the New GM Chrysler Company! Stay tuned this is going to get uglier!