Breaking: Renault board approves discussions of GM-Nissan deal
With Nissan's board of directors already on record as supporting discussions of the possible three-way deal between General Motors, Nissan and Renault, the French automaker's board met Monday to discuss the Ghosn and Kerkorian proposal. The company issued a terse press release after the board meeting, saying "The Board of Directors approved the position proposed by Carlos Ghosn: Exploratory discussions with General Motors, concerning a potential alliance, could start if General Motors Corporation makes the proposal."Renault's board was expected to be a harder sell than Nissan's - the reaction of European analysts has been largely negative, with a GM deal seen as having no short- to medium-term benefits to Renault, while adding the risk of distracting management during Renault's vitally important restructuring program, currently in its early stages. Buying in to the deal would likely cost Renault about $1.66 billion, putting downward pressure on its credit rating - another mark against the three-way arrangement.
Sounds like the ball is in GM's court now...
[Sources: Renault, Reuters]
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Reader Comments (Page 1 of 1)
JC Whitless 3:07PM (7/03/2006)
GM Surrenders
/obligatory
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DarkKnight67 3:32PM (7/03/2006)
Yep, the first comment most certainly did come from someone who's whitless. Nobody said this was a done deal, JC, and it would still have to be approved by the GM board and probably quite a few stockholders who want to ensure they aren't getting screwed.
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JC Whitless 4:11PM (7/03/2006)
Actually, it was a French joke....
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Matt Keegan 4:11PM (7/03/2006)
This could be a good move for all three parties. Globalism warrants international cooperation and this is simply one more of what will certainly be many collaborations to come:
http://www.theautowriter.com
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laserwizard 4:28PM (7/03/2006)
This would be quite a collection of misfits.
Interestingly there isn't one company in this collection that has any styling prowness. Nissan would desperately want to be able to build a real truck but will find that GM doesn't either. Renault would love to be able to sell their cars but knows that Renault in American means "you've got to be kidding" so I'd look for Saturn to carry Renault rebadged cars. GM would love to find quality but won't find it in either marque.
Somehow this smells like the Fiat fiasco all over again - maybe GM can screw the French (!) and the Japanese by taking the money and running.
I cannot wait to see this mess unfold. Just when you thought GM couldn't do anything more stupid, they find a new low.
Party on, Garth!
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rw 4:33PM (7/03/2006)
I just do not see this having any positives for any of the parties involved. Other than giving Nissan a big truck that would sell. So what would the purpose of having Nissan, Chevrolet, GMC all selling the same truck? Really Kerkorian must have had a mini stroke.
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dude 4:43PM (7/03/2006)
Um, I'm confused. Is this going to be one of those buy 25% of my company deals or are we looking at a majority share takeover?
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Mansoor 4:44PM (7/03/2006)
After living in North America for my whole life, I've finally come to Germany for a year as a student working for INA. I am certain that most of the cars here would not sell particularily well in the United States/Canada. And this is the only benefit I see GM getting from this deal - more small cars. I mean people in North America hate driving 117 hp Civics...what will happen when they drive 1.4L 75 hp cars (not diesel) or 1.0L 3 cylinder cars. I dont think the gas prices are high enough for people to drive these pieces of crap.
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naggs 4:55PM (7/03/2006)
i dont believe that there is any talk of takeover majority or otherwise.
its a partnership that allows them to spread engineering cost to develop similar platforms and share global parts bins. the potential cost savings can be huge if done right, if done wrong you end up with a Renault that is a rebadged silverado
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gbh 6:11PM (7/03/2006)
Holy crap guys.
Do you honestly believe that GM has anything to offer anyone that could provide ROI for that investment?
This is nothing but Cap'n Kirk bouncing the dead cat.
Even if the Cap'n could install Ghosn as god at GM, it would be a waste of time and money. This is nothing but Kerkorian setting the stage for one of a couple of different moves.
Scenatrio one: Whack-job Wags continues to run the company into bankruptcy as per the plan. A predetermined cabal will come in and pick up the profitable pieces. Lose the UAW terrorists, and most of the incompetant management. Kill off the worthless cars. Sell fleet vehicles and work trucks. Have a (relative to current) tiny division that sells cars.
Scenario two: Old Kirk has admitted to himself that GM's corporate culture is as inherently self-destructive as the smart analysts have been saying for years. Even his 'whizbang' abilities cannot right the Titanic. But he cannot dump the stock without causing instant collapse of the entire company, and thus collapse of his stock as he tries to bail.
Hmmm, who can I sucker in to buy this white elephant? Perhaps ze French...
This is standard smokescreen for something afoot behind the curtain.
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DarkKnight67 9:22PM (7/03/2006)
Sorry about that JC. I guess my time and heat addled brain missed out. Still, I won't wait breathlessly for this to get completed.
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