WE ARE THE CHAMPIONS!
Join Date: Jul 2002
Location: Lake Dallas, TX
The merger is going to happen with or without federal help.
GM has said that this "help" would save jobs. Frankly I don't believe them. The combined company would have a grotesquely high production capacity without a market. IMO GM will have no choice but to close factories.
I can already see that GM will kill off several Chrysler models. The only models that are guaranteed to survive are the Chrysler minivans and Jeep Wrangler. The Dodge Challenger, Viper, Caliber, and Avenger are all going to die. The Durango and Aspen have already been killed. The RAM will likely die to. The Dodge Charger and 300 may live on as GM products (Perhaps as a Buick and Chevy) I say this because Chrysler is well into the redesign of these products and GM might be interested in using them. On the Jeep side, the Commander is already dead, the Grand Cherokee will likely go away too. The Chrysler brand itself will have next to nothing..
So what does GM get out of this?
$11BILLION in Chrysler's cash reserves. The get rid of most of GMAC (which is hurting them right now). They get rid of a piece of their competition (especially in full sized trucks). They get a brand new full size truck platform that can be easily be re-skinned as a Silverado (if they choose)
On top of all of this, GM is rumored to be shopping Buick to their partners in China. Buick is a HUGE luxury brand in China. If GM sells it, they save a ton of money in marketing. They effectively dump a brand without spending a dime. They also eliminate cross competition with Saturn (which GM has said they want to take upscale).
Frankly I don't think GM needs this Chrysler merger. I would rather see them get rid of Saturn than Buick, but one of them needs to go. Saab should have been sold off a long time ago. Hummer is already on the auction block. They should also kill GMC and maybe even Pontiac. GM only needs Chevy and Caddy to survive but a third brand like Buick or Saturn will work too.
Meanwhile, over at Ford, they have already decided to add a third shift to the production of the 2009 F-150. The Ford Fiesta is coming online soon, as well as a whole slew of new products. I think Ford is going to have an instant hit with the Fiesta.
In the next two years Ford will have these new cars:
2010 Ford Mustang
2010 Ford Taurus (and it is shaping up to be a really good looking car)
2011 Ford Kuga (may be a Mercury)
2011 Ford Mondeo (may be a Mercury)
2009 Lincoln MKT (large crossover)
2011 Ford Focus (finally based on the Euro Focus)
2010 or 2011 Ford Explorer (unibody based and very fuel efficient)
MAYBE a 2011 Ford Ka (imported from Europe)
Just a couple of years ago, I thought GM was poised for a comeback in 2009. Now I think they really are fighting for their survival and may very well file for bankruptcy before 2010. On the other hand, Ford is doing a bang up job ever since Alan Mulally got there. If oil prices hadn't sky rocketed, I think Ford would have been profitable this year. However, oil prices did skyrocket and Mulally has done a better job of adjusting than Wagonner has at GM.