GM-Chrysler: A Lemon Of A Deal

The fall of the American auto makers has been so predictable especially from the viewpoint of my generation (gen y). Its the baby boomers running these companies that are still holding on to these old notions of what a car should be and what americans wants, that are driving these companies to the brink of extinction. Yes the prius is ugly and droky, but it makes so much sense. And why can't america build a solid compact like the civic that is reliable with an incerdible resale value? Remember the cavalier, now cobalt? What piece of junk! Whatever GM does now will be too little to late to make up ground in the market.

The word 'albatross' springs to mind.

GM has just managed to get rid of - expensively - the cross around its neck that was FIAT, dropped its expensive associations with Toyota and Suzuki (you know them ? where GM built cars for other companies and then paid them to sell them under their own names) and now they want to take on this Grade A Turkey that hasn't turned a profit since the early 60s.

Give it up, just stick with Adam Opel and Daewoo.

They may survive only if the merger would help them to get rid completely of unions, and may be from their pension obligations. If it does not happen now - unions will be gone soon nyway through bancruptcies, and even Obama will not help. Only after that US automakers get competive.

Chrysler has been in toght shape for fifteen years and this merger makes as much sense as tossing a bag of rocks to a drowning man... . "Hey, lets take a major auto maker that's struggling and tie it onto one that's been struggling for a decade!"

GM and Chrysler would be able to leverage an incredible amount of economies of scale with not only their own manufacturing operations, but will be able to extract more for less money from their suppliers. I agree with you, aremee, the author displays a stunning lack of knowledge on the subject matter...Just another Newsweek article hell-bent on deriding US industry... GO GM / CHRYSLER/CERBERUS!!!

It is very possible that the 11.1 Billion that Chrysler has supposedly socked away may be a myth supported by creative accounting. If the whole reason for the merger is this money, then serious second thoughts should be brought to the fore.
The chickens are all coming home to roost. It seems that unequalled Japanese quality and service will eventually win the day. So many consumers have been gypped by big Detroit dealerships, both in sales and service. Many more have had to deal with inferior products made so not by engineers, but by the bean counters in Detroit. Now that everything is in a downward spiral, Detroit has finally managed to make quality cars, and give better service. Is this now too little, too late? I hope not, but it may be so.

This link of a CSPAN video clip may help set the context, as these hearings were at the time of McCains attempt at S.190.

http://www.youtube.com/watch?v=_MGT_cSi7Rs

"Video Unearthed Democrats in their own words Covering up the Fannie Mae, Freddie Mac Scam that caused our Economic Crisis"

Yeah, that makes a lotta sense. Chrysler has never made any money to speak of, so why wouldn't another car company that's already in trouble want it? With that kind of logic, it's no wonder that this country is in the shape it's in! Its business leaders are total idiots!

The problem with keeping Buick around as a Acura, Lexus and Infiniti competitor, is that you have to remember that those 3 Asian makes were created with BMW and Mercedes aspirations. They don't want to be considered the next viable tier below the German makes... they want to be considered on the same level as the German makes. Buick has nothing to aspire to because it is articially constrained by the presence of Cadillac above it. So where Lexus may try to offer technology that competes with a feature in a certain Mercedes, Buick will never offer that feature if it pushes that model above the place held by a Cadillac model.

Secondly, as an American, I resent an American make such as Buick designing and releasing their latest design concepts in China. I do understand that China is their best market now, but if that's the case, then sell Buick to the Chinese because it can't be everything it wants to be in America with Cadillac above it.

A fully equipped Honda Accord tops $30,000 these days. An entry level Mercedes Benz C Class starts slightly higher. There is no room in the market for mid tier makes anymore. Too many players trying to offer similar features for less money. In today's US market, I don't see where a Buick or Lincoln fits anymore. In fact, Ford would do better to drop Lincoln and concentrate on the Ford and Volvo brands.

I totally agree. It's a really bad idea. I like one idea that I've seen floated around. Let GM use this economic downturn to file bankruptcy. While under protection, ditch the redundant brands. Saab, Hummer, Saturn and Buick can go. Chevy can tend the mainstream car and truck buyers. Cadillac can concentrate on luxury sales. Pontiac can concentrate on RWD performance cars. And GMC can concentrate on specialty trucks that differentiate themselves from mainstream Chevy truck offerings. Close down dealerships for the jettisoned brands, and force the remaining dealers to upgrade their sales and service centers, with the goal of providing Lexus-like customer service. Design and build the cars here in America. Shoot for best in class, rather than matching class leaders.