MoparOhio

Maybe I should buy my Challenger soon.... from autoblog.com

In 1987, Chrysler purchased the American Motors Corporation from Renault, and all AMC models ceased to exist shortly thereafter. The only survivor was Jeep, which was really the only brand worth rescuing. Could something similar happen today if GM "merges" with Chrysler? Once again, Chrysler's most desirable asset is the Jeep brand, along with its minivans – a segment that General Motors has completely abandoned in favor of three-row crossovers. In such a scenario, the Chrysler and Dodge brands would basically cease to exist, with General Motors phasing the products it wants into its own lineups. Newer, efficient plants could be converted to build GM vehicles, which would allow the General to close older plants and lose excess production capacity that isn't needed. Any cash that Chrysler has on hand would allow GM to float its own operations that much longer before returning to profitability. This is a simplistic overview, but it is a possibility being floated around by analysts that would explain why GM has any interest in Chrysler at all. We imagine there would be huge opposition to the situation playing out like this, not the least of which would come from the United Auto Workers , which makes us wonder how likely such a "merger" could possibly be.

Rudy61SRT8

FOXNews reports that the talks between GM and Chrysler continued today ... (saw this 10mins ago)

mopar2ya

I seriously doubted that Cerebus ever really wanted into the car manufacturing business. They saw a bargain deal on a company that appeared to be a very viable investment. They are investment people... buy low... sell high. No doubt they have done thier homework and have decided to at least entertain talks with GM. I can see where owning GMAC would fit much better in thier business model. In contrast GMAC is probably not where GMs main interest lies... but more capacity... some cash... and some upscale manufacturing facilities would play well into thier hands. Sounds like it could play out as a win/win for GM and Cerebus... and a lose/lose for Mopar fans... [&o]

kevin2323

chris, your exactly right...they wanted to buy a troubled company at a bargain fix it up a bit and then sell it off for a profit.. now it seems like they will trade it for anything that looks like a better deal than chrysler.

MoparOhio

From Detroit Free press... looks like it may happen.... wow... I just don't get it..





GM-Chrysler merger talk
Financing may be holding up deal
Cerberus could put up the cash to make it work
By TIM HIGGINS and KATIE MERX • FREE PRESS BUSINESS WRITERS • October 16, 2008

Chrysler owner Cerberus Capital Management and General Motors Corp. are working as hard as they can to get a deal to merge the two automakers, but financing is the issue keeping them apart, a person familiar with the talks told the Free Press.

But the private equity firm is “willing to put in cash to any deal that makes sense,” another source said.
A merger is seen as Cerberus’ preferred solution for Chrysler, where U.S. sales have dropped 25% so far this year, the people said. But financing a deal such as this can be complicated and could involve money flowing either way. When Cerberus acquired majority control of Chrysler from Daimler last year, the $7.4-billion deal included then-DaimlerChrysler spending money to get rid of its U.S. unit.
Because neither Cerberus nor GM is making public statements about the talks, it’s hard to definitively say how things are going. What is clear is that a number of scenarios including a laundry list of automakers and possible equity stakes are floating around Detroit about the future of the auto industry and Chrysler in particular.
GM hopes to have a deal by the end of the month, the Wall Street Journal reported Thursday.
It noted that J.P. Morgan Chase, a key lender to both automakers, favors a deal. Citing people briefed on the talks, the paper said a deal is far from settled.
The turmoil in the U.S. auto industry could have historic ramifications. Industry sales in the United States are down almost 13%; GM’s sales are down nearly 18%.
Chrysler’s supposed kitty of cash could be useful for GM.
GM, which lost $18.8 billion in the first half of the year and has been burning through at least $1 billion a month, is believed to have enough cash to make it through the rest of 2008, but several analysts worry the company will not have enough for 2009.
Barclays Capital analyst Brian Johnson, in a note to investors, said GM is about $2 billion short of what it needs to make it through 2009 even with help from the government and drawing down an additional $3.5 billion on its credit line.
As a privately owned company, Chrysler’s finances are less clear, but all signs point to trouble. The automaker has seen the biggest sales decline in Detroit, and it has indicated that its automotive and financial arm lost $509 million in the first quarter of the year. It has said it had $11.7 billion in cash on hand at the end of June, and that it had earned $1.1 billion before interest, taxes, depreciation, amortization and before restructuring charges during the first half of 2008.
Chrysler had identified $1 billion in noncore assets to be sold to raise money and has said about half of that has occurred.
“People have been talking about the $11 billion that Chrysler supposedly had at the end of June. I think Chrysler needs that money just to maintain its operations as well,” said Aaron Bragman, an analyst with Global Insight. “If that cash is going to be used by GM to further its own operations, that means they’re going to shut down Chrysler.”
There could be other partners for Chrysler, perhaps Renault-Nissan. An executive with Renault reportedly said earlier this month that the automaker might be interested in Chrysler.
Chrysler and Nissan already have an agreement to build some specific vehicles for each other. Similarly, Chrysler is building minivans for Volkswagen.
“For a foreign automaker, there is value in Chrysler in its domestic capacity, in its domestic brands and dealership network,” Bragman said.
Some see Italian automaker Fiat as a dark horse candidate to acquire Chrysler, noting it has the means and motivation to make such a deal work.
In August, Tom LaSorda, a Chrysler president and vice chairman, confirmed that the Auburn Hills automaker had talked with Fiat, but he declined to say over what. “At this stage, there are no formal discussions going on,” he said back then.
Chrysler Chief Executive Officer Bob Nardelli has also said a Chinese automaker might be interested in buying Chrysler. “It depends on who has a hoard of cash in this economy because they’re not going to get a lot of debt out there,” Nardelli told the Automotive News.

Rudy61SRT8

I saw this on Morning Joe this morning and it does look like the talks are getting heavier :-(

kevin2323

and if anything positive comes out of this is that my pockets get heavier with my stocks but besides that i am worried about not being able to get a challenger in time,

BLK 6050

Looks like my Challenger is becoming more and more a limited edtiton.....but all for the wrong reasons.....
seems as if Chysler's five year plan for the Challenger maybe shortened by a few years.....

2007HemiCuda

Well since everybody seems to be into speculation the last few days an exercise.

We know 6400 2008 SRT Challengers are not rare. What does a GM world mean for the Challenger as a future collectible?

I’m still glass half full and looking forward to the Chrysler IPO in late 2010.

Rudy61SRT8

6400 cars is not a lot ... considering a lot of those 6400 are celeberties and stuff that had pre orders.

but again , 6400 cars in a model year is nothing.