Wagoner and Ghosn meet - 90 day confidential review decided upon
General Motors CEO Rick Wagoner and Nissan/Renault CEO Carlos Ghosn finally met yesterday in Detroit to discuss a potential alliance between their two companies that was first proposed by GM's largest individual shareholder, Kirk Kerkorian, two weeks ago. The meeting resulted in an agreement to confidentially review the pros of such an alliance for the next 90 days. After the review period the two companies will determine whether an alliance needs to be explored further.
What we gather is that the idea of an alliance could be shot down during this confidential review period, or it could survive for another round of review. Either way, it doesn't sound like a decision will be made after three months.
The decision to keep this first review behind closed doors is understandable when you consider how much attention this whole affair has received in the media so far. According to Reuters, now that the two CEOs have met, neither company will comment on an alliance anymore, presumably until after this 90-day review. So, we guess we'll meet everybody back here in three months.
[Source: Reuters]
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Reader Comments (Page 1 of 1)
8189720 2:41AM (7/15/2006)
Wagoner is having a meeting with Mr. Bean... or maybe it's just my imagination.
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iQuack 3:10AM (7/15/2006)
So, here's the plan:
http://xs103.xs.to/xs103/06285/Ghosn.jpg
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doug 6:58AM (7/15/2006)
I am struggling to see the benefits for Gm in this. While its current lineup is non-competitive, they have plans in place for all segments.We have seen the subcompacts coming from Korea - new Aveo this fall, the new Corsa in Europe is being released, the Delta platform is being revised for small cars, the Epsilon for midsize, and the Zeta for RWD. All these platforms will debut new models in the next 2 years. Unless GM knows they will suck already, what from Nissan/Renault will they take? And what would Ghosn want from GM?
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GhostDoggy 7:27AM (7/15/2006)
Even holding a meeting tells me as a potential stockholder that GM has completely lost and is now looking for a begger's solution. The first thing I would do is have GM remove half of the models from each badge and then remove 2-3 badges. Maybe that would save on some upper-management compensation packages.
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Clarence 8:51AM (7/15/2006)
Toyota offers one car or truck per segment. The Lexus thing muddies the water a little bit. GM offers a bunch of badge engineered cars which gets very confusing. I have had no idea for the past 20 years of the hierarchy of GM cars. With Toyota it's easy to see the stepping stones. GM needs to define each brand into just one car (exception for Cadillac) and sell all GM products at one dealership. Larger trucks probably need separate dealerships and perhaps Cadillac could go separately with several models in a Lexus style operation. Corvette should become its own brand. This advice is provided free but is worth a couple billion dollars.
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Bob Miller 8:53AM (7/15/2006)
This is about Kerkorian making money. GM doesn't need Renault to help at all. With the kinds of numbers these companies talk about, $3billion is nothing.
From a product standpoint, what does GM need that Nissan has? The new GM products look like they're going to be more than competitive, like the upcoming Saturn Outlook and Aura, the new CTS and the new rear drive Zeta platform cars. And look at Nissan's sales success with the Titan and Armada. It's bad. I just don't see what GM would get out of it? Perhaps they'll get some added systems and/or processes that may help control cost, but I don't really see much else.
I think Renault and Nissan may be after those 12 factories that GM is in the process of shutting down. The cost savings there could be tremendous, especially compared to how much it would cost to build new factories. Ghosn even said publicly yesterday that he was interested in GM's excess capacity.
So, is this an "alliance"? Call it whatever, but at the end of the day, the main drivers behind this, Kerkorian and his right hand man, York, probably just want to see the value of the stock go up in the short run. Do they care if GM and Nissan end up flopping in 5 years because the Titan and Silverado are the same vehicle, pissing off thousands of once die hard Chevy fans? Do they care that GM has spent years trying to develop multiple platforms that truly will be competitive, only to see some of them go away or get overhauled by an outside company with interest in their own product first? Not really.
Are the above scenarios really going to happen if these two companies merged, or formed an alliance? Nobody knows at this point. If some of the product lines started mutating between Nissan and other GM brands, would it be all that bad? I don't know that either. That would probably depend on how they were marketed, what components actually got shared, etc, etc.
An example of a merger that produced a great product, one of my personal favorites on the market now is the Chrysler 300C and Dodge Charger R/T - a great mix of American styling, attitude and good old pushrod Hemi power, with the best from Mercedes parts bin. Those two cars rock ass. But the thing is, Chrysler didn't really have an awesome rear wheel drive car platform that was needed to make that car without some significant platform development that I don't think would have happened had they not had some outside help. As it stands today, in order for GM to make an outstanding product like the Dodge Charger to make, let's say, a rear drive Impala, all they have to do is borrow the already existing platform that they have from Holden (which apparently will happen anyway), or even the North American developed Cadillac CTS/STS. Even though it's a nice platform, they don't need the Nissan rear drive platform.
Bottom line for now - as far as what the mainstream media thinks on what the goals of these two companies are and what will ultimately come of all this: all speculation.
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Michael Karesh 9:22AM (7/15/2006)
This gives GM another 90 days to figure out how bad a summer it's having. Will Ford or DCX get desperate enough during this period to launch the mother of all incentives?
GM does have some better products coming. But so does just about everyone else. I used to get sucked into the "the future products will turn them around" thing, but then I figured out that it's hard enough for them to just stay in the same place on the treadmill.
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NEBTEK2002 9:25AM (7/15/2006)
Nissan is pure garbage.
I sure hope that good cars like the Cobalt and HHR don't wind up with sludge-bucket Nissan 4s.
I hope a reliable Chevy truck is rebadged a Titan and not the other way around. The current Titan is pure junk and they 're slowly rotting away on storage lots.
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Rastus 12:15PM (7/15/2006)
At least Heinrich Himmler had the descency to swallow a cyanide capsule.
http://images.google.com/imgres?imgurl=http://www.leninimports.com/heinrich_himmler_9.jpg&imgrefurl=http://www.leninimports.com/heinrich_himmler.html&h=257&w=304&sz=23&hl=en&start=7&tbnid=NAzXlrETJ0p2wM:&tbnh=94&tbnw=112&prev=/images%3Fq%3Dheinrich%2Bhimmler%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DG
Mein Furher Wagoner, please do not forsake GM!!! All these die-hard *AMERICAN's* will see you for what you are...a TRAITOR!!!
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gbh 6:54PM (7/15/2006)
C'mon now Rastus. It's really bad to start dragging the Germans, especially Nazis into the death of GM.
It's insulting to the scientific and creative genius of the scientists who worked for the Nazis (willingly or not). GM leaders have all the strategic acumen of the French, and all the tech-savvy of Tibetans.
Much of the stuff the Nazis developed was frighteningly advanced compared to Allied tech of the time. The world is very fortunate that Hitler had as little understanding of tech and long-range strategy as Wagoner does.
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AR 7:33PM (7/15/2006)
If they actually go through with this, I will steer clear of Nissan. The very thought of Nissan badged Chevrolets or Infiniti badged Buicks makes my skin crawl. Do us a favor GM and just die already.
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Rastus 7:34PM (7/15/2006)
No, the point I was trying to make was this: Himmler was on the run from Adolf and Co. due to his covert dealings with the Americans (ie, the enemy). This was towards the end of the Third Reich.
Well, to all those "Buy American" thugs out there...I would imagine THIS TOO would constitute "treason". I mean, common! We too are witnessing the end of the "GM- The Worlds Largest Automaker" as we know it.
GM IS DEALING WITH THE FRENCH?!!!!...and is looking to the FRENCH to save their hides???
But in the end, Himmler simply did the noble thing (once he was in custody by the Americans)...and ate a pill. If GM is in THAT dire a need for help...
...then what are the "Buy American" thugs going to do without a leader???
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gale 10:44PM (7/15/2006)
#8 wins the genius of the day... calling the Cobalt and HHR "great cars" and all Nissans "garbage" is the dumbest thing I've ever heard this side of one of lithious' insane buy American rants.
Nice job, now we know NEBTEK means RETARD in Michigan-ese!
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gbh 10:48PM (7/15/2006)
Sorry Rastus, I had tongue planted firmly in cheek...
I guess all the "Buy Amurriken" types will migrate to Ford, they should stay afloat for a while longer.
I too have heard the GM fanboi crowd squeal more and more lately. They might just go lynch Wags if he doesn't "fight off them furriners". This of course is compound funny because GM couldn't really fight off a hostile takeover effort by a marauding group of Girl Scouts that have banked their cookie money for the last couple of years. Better still, Wags' battle plan would be to give them a big check of borrowed money and hope they go away, so he can get back to "saving GM".
ROFLMFAO.
The article in McPaper yesterday was a hoot. Wags was staying on message that the GM recovery is just around the corner, and these rumors and speculation are a distraction. If only us nattering naybobs of negativity would just shut up, people would realize that the quality of a Cobaltalier is right up there with a Civic.
The fact that nobody who has ever driven a Civic would rank Cobaltalier a better car in any way is another wicked anti-American self-deception.
People like me and you are killing the company. Is all this power going to your head yet? How 'bout we topple a couple of governments tomorrow and Monday? Mideast peace on Tuesday or Wednesday? I'd like to take Thursday off, but we can fix Darfur on Friday, OK?
Sorta like the BS you heard out of Enron for most of it's big run.
It is truly puzzling to me why some still think that Nissan would have any use for any of the cast off GM relic factories. It would cost Nissan more to bring most GM plants into modernity than it would to just build a plant from scratch. Most importantly, you can build a really nice plant for way less than a billion, why piss away 3B? Even funnier, as if Nissan would want GM's UAW employees from any plant but maybe one.
Here's reality: who's gonna buy an empty GM factory? Nobody. Only a fool would pay for something that they can get for free, or better, get paid to take. The local governments will taxbreak like you can't imagine just to get somebody to take one of those white elephants.
While these hypotheticals are kinda fun, say it with me now, "THERE IS NO REAL DEAL".
3 Billion in new cash would keep the GM illusion going for a few more months. Nobody will EVER buy GM until they can fix the absurd overhead costs. The only way to address those costs is a court approved reorg. AKA, a bankruptcy.
This Nissan/Ghosn/Renault show is a distraction for the real sleight-of-hand that's already in progress.
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digitalzombie 6:25AM (7/16/2006)
oooo gbh fought back. I remembered the Titan selling well. Xterra is doing pretty damn well that's for sure.
I've stepped foot in a 2002 Chevy Silverado once. It scared me. I didn't realize there was a company out there that think they can fool their customers by using the same parts in their other cars and put it in the silverado not only that their plastic was worst than Nissan. Which is really absurd.
I don't get why people are afraid of Titan rebadge as a Silverado. Last time I check the Nissan Titan got 2nd place in Car and Driver, Ford got First, while Silverado was dead last. Funny how the Titan is Nissan first entry to the Full Pick up segment while GM have several generation of Silverado and they still managed to get dead last.
The only thing I see Nissan getting out of this deal is technology. There will not be a Merge. There is no way Nissan is going to jump head on and inherit GM problems.
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Charles Kemper 2:17PM (7/16/2006)
Having spent a number of years in operating roles in the auto business, I have absolutely no idea why anyone would think that a merger of GM and Nissan-Renault would be good for shareholders. The WSJ even posited that a merger between GM and Ford might be a good idea. Building a bigger, less nimble, more bureaucratic giant is not a solution in my opinion.
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NEBTEK2002 6:44PM (7/18/2006)
There are over 100 Titans sitting on my local Nissan dealer's storage lot.
One was there so long that when the potential sucker took it for a test drive, it died about a block down the road and blocked rush hour traffic until being towed off.
A distracted cellphone user hit my Ranger in the left wheelwell while trying to change lanes. Her insurance company got me an Altima to drive while the truck was being repaired.
What a tinny pile of crap! Not a scrap of insulation in the floor under the cheap carpet. And the alleged 141 horsepower felt pretty inadequate compared with the Ranger's 112.
My sister's Hyundai Accent, my former benchmark of tinniness, was a Mercedes by comparison--and thousands cheaper, too.
If GM needs to sell out to survive at least they can go Korean.
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