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GM to buy Chrysler?

February 16, 2007, 12:03 PM by Pauley

So Reuters reports…

That would make things interesting in NASCAR and other racing series…

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    !!!!!!!!!!

    I know they have been in talks about jointly developing a new large SUV but...
    This just does not make business sense.
    I can see no synergy here...
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    Analysts interviewed for the report tend to agree:

    Analysts have questioned whether GM would benefit from a merger with Chrysler, since both automakers are struggling with excess production capacity, sliding sales and a heavy exposure to trucks and sport utility vehicles.

    David Feinman, a fund manager who specializes in distressed debt with Havens Advisors, said he doubted that GM would complete a deal to buy Chrysler.

    Feinman, who does not own GM debt, said both GM and Chrysler have too many overlapping models, and any merger would have to result in even deeper cuts to jobs and output.

    "If they do merge, there would have to be massive streamlining and there would be hundreds of thousands of more jobs loss," he said.

    He added, "The only one to benefit would be Daimler because they would get rid of Chrysler."


    -- Pauley
 

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