Don't believe that for a moment. US auto makers made their bed now they have to lie in it. The last thing we want is gov't over-sight of a car maker. Sure holding them to a certain level of safety and emission control may be ok but other than that the Feds need to stay out of it. Imagine the price of a CTD Ram if Pelosi stuck here nose in DC's business.

Just how long did they think they could sell their junk to the American public? Other than trucks and some SUVs, most folks drive foreign cars which is the biggest share of the market. Detroit killed themselves with high-priced, low-quality, out-of-touch designed vehicles.

Washington can't help themselves, let alone help Detroit.

 

Bad news - Cerebrus is pushing this to the max. They want GMAC or rather the rest of it and GM won't give it up. http://www.usatoday.com/money/autos/...terstitialskip

The problem is that Cerebrus used future earnings to purchase Chrysler and now they have their b*lls in a vise. GM would close the Chrysler plants, milk the pension fund and feed everything into the GM plants, which not surprisingly, are closing.

I'm sticking with the Unimog - at least Daimler won't bury us.

 

What I meant was, Congress created this financial mess Because they lifted lending rules on many really risky real estate deals (Fannie May/Freddy Mac) to get deadbeats in homes that cant read or understand the contracts they signed. And along with the rest of Wallstreet the Auto makers have leveraged them selves out on a limb in realestate. The Merc and Chrysler merger in 98 was a hostile take over IMO, that the Feds should have stopped.

Just a side note, I wonder what the profit margin really is on light trucks when there selling them at 1/2 price around here now?.

 

The Cummins aint goin anywhere people. Quit panicking

 

yup. If GM ditched that, then boy they have to be the stupidest company alive and wuld deserve to go down.

 

I'd be willing to bet GM keeps the Duramax over the Cummins in there 3/4 ton 1 ton pickup lines.

 

Agreed and hold on to your hat, if BO gets elected we'll be making sure everyone has a house, car, boat, retirement, etc. etc. This could get a lot uglier real quick.

 

If they do, they are idiots...

 

It's all about the $$$. They probably WOULD use their own brand.

 

It is totally about the money. I dont see GM being any different than Cerbus. They need to pay there 10 levels of management to sit around trying to figure out what the hell is going on!

I will tell you one thing, if GM and Cerbus do this deal they can both go fly a kite for all I care.

I wouldn't buy one if it was the last vehicle on this screwed up planet!

If and when this deal goes through there will be a ford or Japanese vehicle sitting in my driveway.

Wont get rid of the Cummins though, mine was made when Dodge still cared about vehicles.

Jason

 

Things aren't rosy over at Ford either - $2.43/share! It's Kerkorian again, and I wished he'd bought Chrysler in 1995 instead of Daimler. http://www.bloomberg.com/apps/news?p...VEA&refer=home

 

Worst case scenario: (just as the pundits are predicting) GM buys Chryco, keeps the minivans and Jeep. Shuts down the rest and uses Chryco cash as life support until the economy recovers. Their sales go up in the mean time because they eliminated a major competitor. Dodge dealers file massive lawsuit to no avail. Cummins is out in the cold, has to eat the new LD diesels and Ford scoops up the 6.7 as an option in their HD pickups (as their in-house diesel is still a prototype and lots of $$$ away from production).

Alternate scenario: Same as above, but Dodge Ram is sold to Nissan/Renault since they have a contract for Dodge 1500 bodies starting in 2010 anyway. Cummins stays on as engine supplier for both LD and HD pickups (Nissan already has contract in-place with Cummins for commercial vehicles, so it's not a stretch). HD pickups may get the ax after 2010 depending on fuel prices, economic conditions, etc. Sale gives GM a lot of cash, but they still have to face the competition of a surviving Dodge/Nissan line of trucks.

Better case scenario: Ok, here's a long shot: GM dissolves Chryco, Toyota scoops up the Cummins contract for the new LD engines for their Tundra and comes out with a 1-ton with the 6.7.

Best case scenario: Other than waking up and finding out this was a bad nightmare, I can't think of one.

 

How about this...

GM uses the 6.7L Cummins for the Topkick's, the Dmax for the 3/4 and 1 tons, and the new Cummins 4.5L V8 for their tiny trucks....

I dont think Dodge is going to dissolve really quick. But watch it, part prices are going to go up....

 

GM just spent a lot of money making the 4.5 duramax and the new 2010 duramax......why would they throw it away and put the smaller V8 cummins in anything.......

the 2010 new HD rams are already being tested etc.. probably pretty much finalized. I doubt they are just going to up and dissapear. I still think you guys are all panicking for no reason.

 

BLOOMBERG Article:

Cerberus May Keep Finance Division as It Seeks to Sell Chrysler

By Jason Kelly

Oct. 21 (Bloomberg) -- Cerberus Capital Management LP, the private-equity firm that's in talks to sell Chrysler LLC, may keep the company's finance unit in an effort to make the most of its ill-timed foray into the auto industry, according to two people familiar with the matter.

The New York-based firm's negotiations with General Motors Corp. are focused on combining auto production, and a transaction may not include Chrysler Financial, said the people, who asked not to be identified because the discussions are private. Cerberus is also talking with Nissan Motor Co. and Renault SA about a linkup, the people said.

While shedding Chrysler would mark a retreat by Cerberus from the largest private-equity investment in auto manufacturing, retaining the vehicle-lending unit would play to its strengths in finance. The firm, managed by former Drexel Burnham Lambert Inc. banker Stephen Feinberg, bought Auburn Hills, Michigan-based Chrysler for $7.4 billion in 2007, following its $7.4 billion purchase of a majority stake in GMAC LLC, the finance unit of Detroit-based GM, in 2006.

``Financing is a better business for them,'' said Paul Schaye, managing director of New York-based Chestnut Hill Partners, which helps private-equity firms find deals. ``The automotive industry came to a screeching halt, so it makes sense to get rid of the bricks and mortar and become the automotive bank.''

Feinberg put as much $4 billion into GMAC and Chrysler before they were battered by the subprime-mortgage collapse and rising gasoline prices.

Equity Stake Possible

Cerberus may seek an equity stake in a combined Chrysler-GM and may put cash into the new company, according to one of the people familiar with the talks. Additional funding may be needed as the automakers seek ways to pay for potential job cuts related to a merger as sales fall and credit markets stay tight.

Officials at Cerberus, GM and Chrysler declined to comment.

Cerberus has bought companies in a variety of industries, including financial services. The firm controls Japanese lender Aozora Bank Ltd. and is part of a group that owns Bermuda-based reinsurer Scottish Re Group Ltd.

Since buying Chrysler in 2007, Cerberus has held discussions about strengthening ties between GMAC and Chrysler Financial, according to people familiar with the firm's thinking. Those efforts have stalled in part because of GMAC's Residential Capital LLC mortgage unit, which has fought to avoid bankruptcy amid the global credit crisis and a U.S. housing slump.

Feinberg's Resolve

JPMorgan Chase & Co. and Citigroup Inc., based in New York, are advising Chrysler and Cerberus in their discussions with GM and other automakers. Morgan Stanley and Evercore Partners Inc. are advising GM. JPMorgan and Citigroup are among the Wall Street firms that helped finance Cerberus's Chrysler purchase and still hold some of the debt.

Feinberg has assured his investors that Cerberus is prepared to weather the current markets, even as it writes down the value of some holdings.

``We have aggressively taken significant markdowns in our private companies where appropriate,'' Feinberg wrote in a letter to investors dated Sept. 25. ``We believe we are marked conservatively and will continue to be aggressive in taking markdowns if the bad market continues and when appropriate.''

Still, Feinberg struck an overall optimistic tone in the 13-page letter, a copy of which was obtained by Bloomberg News. He pointed specifically to finance-related investments in the mortgage and loan markets as areas where Cerberus may make further moves.

``We are seeing both the value of all financial assets being questioned and routed along with a massive and rapid financial delivering,'' Feinberg wrote. ``This combination puts horrible stress on the systems and creates nothing short of incredible buying opportunities.''

To contact the reporter on this story: Jason Kelly in New York at jkelly14@bloomberg.net