Gm Chrysler merger-This is the End Of The Road For Chrysler

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.

GM's efforts to merge with Chrysler put on hold for now

BY TIM HIGGINS • FREE PRESS BUSINESS WRITER

General Motors Corp.'s increasingly dire situation led the Detroit automaker to say Friday that it is setting aside efforts to merge with Chrysler LLC to focus on saving its existing operation.

GM had been pursuing a deal to acquire Chrysler while also asking for help from the federal government to weather the financial turmoil roiling the auto industry.

GM's decision opens the door for other automakers to look at a deal for Chrysler -- with Renault-Nissan potentially reemerging in that scenario -- although Renault-Nissan's chief executive has indicated a reluctance to spend in this economic climate.

GM announced Friday that it burned through $6.9 billion in cash during the third quarter, leaving its reserves critically low. Overall, the world's largest automaker has lost $21.3 billion over the first nine months of this year.

"While the acquisition could potentially have provided significant benefits," GM said in a statement, "the company has concluded that it is more important at the present time to focus on its immediate liquidity challenges and, accordingly, considerations of such a transaction as a near-term priority have been set aside."

Gov. Jennifer Granholm said she was pleased to learn that the GM-Chrysler talks were off.

"I think everyone is leery about providing a bridge loan" from the federal government "to see a merger that would result in job losses," she said. "I don't think that's something that there's great desire to do, understandably. So, I'm hopeful that there is another way to go about having a robust auto industry."

Aaron Bragman, an industry analyst with IHS Global Insight, said the decision raises big questions about Chrysler, which is owned by Cerberus Capital Management.

"What are Cerberus' options now?" he said. "Is it bankruptcy? Is it selling it off to somebody else now? I don't think that just because GM decides not to buy that Cerberus doesn't still sell it."....More

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Great Business Week Article By David Kiley-GM-Chrysler News

Posted by: David Kiley on November 03

Most of the news coverage and rhetoric about the government’s help of General Motors misses the point.

Take the “news” over the weekend as reported by Reuters and The New York Times. “The Treasury Department has turned down a request by General Motors for up to $10 billion to help finance the automaker’s possible merger with Chrysler, according to people close to the discussions.”

The idea that the White House would green-light $10 billion to help GM complete an acquisition of Chrysler was never in play.
Weeks ago, sources close to Rep. John Dingell (D-MI) and Senator Carl Levin (D-MI) said that a direct assistance for a merger of the two companies was a dog that was not going too hunt in the White House or in most of Congress.

When I caught up with Levin last week at a campaign stop, he made it clear that he was not seeking or pushing for assistance for GM to create a merger. If he isn’t pushing for it, then such a plan was not much in play. What Levin and Dingell have been pushing for is the speeded up release of funds from the Department of Energy, which is writing rules and conditions by which the automakers can apply for $25 billion in loans to off-set tech investments they have been making since January of 2008 and through next year to bring more fuel efficient vehicles to the marketplace. The lawmakers are also pushing for GMAC, Ford Credit and Chrysler Credit to be able to borrow from the Fedetral Reserve’s discount window like a bank in order to make more credit available to borrowers.

As Levin said: “These measures are not meant to assist GM in an acquisition of Chrysler, but if it has the effect of doing that, that’s another matter.”

Levin said one idea on the table, and presumably being boosted by him is allowing the automakers and suppliers to apply for loan money to cover retro-active investments—perhaps allowing GM and Ford to recoup money long since spent on hybrids and electrics. That would have the effect of a cash infusion to the companies that could help GM cover the costs associated with taking over Chrysler.

Under an expedited program with DOE, GM and Chrysler could apply for the loans separately, but pre-agree to pool the money to help a merger deal go through.

“The point is to get the automakers cash in the most politically acceptable way,” one Capitol Hill source told me. “And a direct payout to help a merger happen was a non-starter.”



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