Filed under: Chrysler, LLC., Daimler, Hyundai
The plot thickens; Hyundai may be angling for Chrysler
Hyundai and Chrysler already share their 2.4 liter "world engine" (along with Mitsubishi), and they may share much more in the future. Rumors are trickling in from all quarters about potential suitors for Chrysler, should DCX decide to cut loose its American vessel, and Hyundai is the latest one to grab headlines. The main value in purchasing Chrysler, which is suffering from crippling pension and healthcare costs, geriatric factories and indifferent product, is the dealer network.
Hyundai is making an aggressive effort in the US. The oldest thing in their fleet is the Tiburon (though it is newly-facelifted), and quality is way up. Hyundai and Kia vehicles represent good value for the money, and the instant sales organization they'd gain from a potential purchase of Chrysler would give Hyundai a further toe-hold. We're not sure how the brand change might play in Peoria, but we very seriously doubt that the rest of the Chrysler brand would be discarded just to acquire the sales organization.
There's a lot of value in Auburn Hills besides sales mooks. The Caravan and Voyager vans have been redone and are back in the game, and the LX cars still carry cachet, if not sales volume. Were the arranged marriage to occur, there would be some redundant products - such as the aforementioned vans. We're not sure how that would shake out. We bet that it costs Chrysler more to build a car than Hyundai spends, but we'd hope that the better car would win out in the corporate joust. A Sonata wearing a Chrysler badge (with some restyling, of course) wouldn't be such a terrible thing, would it?
Thanks to tipster Avinash!
[Source: timesonline]
Reader Comments (Page 1 of 3)
Petey 3:35PM (2/18/2007)
This is the worst thing that Hyundai could do. Toyota and Honda did not get where they are by buying huge automakers. They continually refined and build their market share. They built their own luxury brands from scratch in the face of naysayers.
They should let Chrysler chapter 11 (if Ford doesnt beat them to it), then go after the resulting market share free for all.
Reply
Howard Kerr 3:39PM (2/18/2007)
Now here's a merger that MIGHT make sense...at least for Chrysler. While it can be argued that there are a few areas where Chrysler and Hyundai compete, albeit not very well, there are segments of the market where the Koreans have a better product and will continue to hold a price advantage...at least for the next few years. It's too bad this merger wasn't considered way back before Kia was bought out. Kia's link up with Hyundai sort of makes a link up with Chrysler less likely to be worthwhile.
Reply
far jr 3:40PM (2/18/2007)
I can see it now... GM gets Chrysler brand name rights to increase difficulty for new makes (such as Chinese) entering the US market. Similar to what Ford did with Rover. Whilst Hyundai gets the dealer network to springboard its US sales. Diamler will breathe a sigh of relief all the way to the bank to get rid of the burdens of Chrysler's pension/ healthcare costs... Just who will get responsibility for these? hmmmm.
Reply
Rastus 3:52PM (2/18/2007)
If an Asian company purchases Chrysler (vice a German one), does that mean people will now call the US auto industry for what it is?
The Big 2?
Oh, I see...white on white, call it "brotherhood" (thus the 0.5). An Asian company coming in for the scoop, call it a "purchase".
Hmmmmmm
Reply
Ben 3:59PM (2/18/2007)
This is one of the plausible rumors out there, but still doesn't really sound like a good idea. Why would they buy for the dealer network? Plus, Chrysler is not a true luxury brand, in my book.
The only things would benefit Hyundai are some of the Jeeps, the LX cars (but Hyundai has a RWD car in the pipeline, so that is kind of a wash), mini vans, and the Ram. In most other segments, including, the important small, mid-size, and new x-over segment, the Hyundai/KIA product more than on par with its Chrysler/Dodge brethren.
Maybe they would do it for just the names?
Reply
St?ane Dumas 4:08PM (2/18/2007)
#1 Petey, Toyota did had acquired some stakes in others automakers or they buying them completely. Hino in 1966, who's now since concentrated in medium-duty trucks and more recently Daihaitsu, investments in Isuzu and recently they had an eye on Subaru http://www.autoblog.com/2007/02/06/thinking-big-new-law-opens-path-for-toyota-take-over-of-subaru/
Reply
Allautoinfo 4:15PM (2/18/2007)
I would rather have GM take Chrysler over rather than Hyundia. Also, will Chrysler stock fall?
http://www.allautoinfo.com
Reply
St?ane Dumas 4:18PM (2/18/2007)
I forgotted to mention then Ben have also some interesting points about the upcoming RWD Hyundai, an theory then I taught is the future RWD car is a premium entry and premium isn't associated with Hyundai. They could re-use it as a Chrysler to avoid the same mistake then VW did by selling the Phateon as a VW instead of Audi or Bugatti.
I also remember a rumor in the late 1980s when Hyundai operated the Bromont plant in Québec, Canada. There was some talks between Hyundai and Chrysler to sold also the Sonata as a Eagle model (to replace the void left by the Renault-badged Eagle Medaillon), but this project didn't go farther. (However in Mexico, the Atoz and the cab-over truck then Hyundai do is also sold by Mexican Dodge dealers http://www.dodge.com.mx )
Reply
Rastus 4:18PM (2/18/2007)
Take my Chrysler...Please~~!
Reply
Frustrated Consumer 4:31PM (2/18/2007)
The Wall Street Journal just posted an article and quotes Hyundai saying they have no interest:
"But the Korean auto maker isn't considering buying Chrysler, a Hyundai spokesman said.
"Our hands are full," he said. Hyundai is currently in the midst of aggressive overseas expansion, with plant investments in the Czech Republic, the U.S. and elsewhere."
Reply
NoNameDenton 5:11PM (2/18/2007)
I figured the Koreans would make a move on Chrysler, they have the money and the ambition to make a move on the company, GM doesn't have the money or time to make Chrysler profitable, neither does VW, Toyota does not want the labor issues, Mitsubishi is too small and needs to turn around sales, Honda is too small as well, Renault/Nissan are busy trying to fix Nissan sales again, the French have their own issues, that leaves the Koreans, the Italians, the Chinese, the Indians, and I much prefer the Koreans on that score
Reply
david 5:12PM (2/18/2007)
stephane, don't know what you taught but please learn english before my grandchildren enter school.
Reply
jjs 5:20PM (2/18/2007)
Interesting. Are you ready for the Hyundai 300? Or the Kia Challenger?
Reply
Michael Karesh 5:20PM (2/18/2007)
This link-up makes the most sense. Which still isn't a lot of sense, but the most. They do overlap in minivans, but that would get ironed out in a couple of years. Otherwise, no significant overlap.
Reply
EquinsuOcha 5:22PM (2/18/2007)
I would rather see Mitsubishi buy them and bring back Diamond Star Motors.
Reply
Hassan 5:23PM (2/18/2007)
Imagine a Sonata with a 6.1L HEMI Engine. 425 HP!!! lol
Reply
Gardiner Westbound 5:58PM (2/18/2007)
Why would Hyundai pay for Chrysler's dealers when it can have them for free after Chrysler tanks?
Reply
RamSport47 6:00PM (2/18/2007)
HOW ABOUT WE IGNORE ALL OF THE SPECULATION UNTIL/IF IT ACTUALLY HAPPENS...THIS IS F---ING STUPID.
Reply
NoNameDenton 6:05PM (2/18/2007)
Anybody have some sedatives we could give to RamSport so he calms down while we discuss this?
Reply
RamSport47 6:14PM (2/18/2007)
Oh...I must be the only one who thinks people that think RUMORS are truths, are stupid idiots.
Reply