Chrysler CEO Nardelli responds to GM announcing merger talks are off
Chrysler LLC just released a statement from Bob Nardelli in which the CEO responds, in a way, to General Motors' third quarter earnings report. In the report, GM acknowledged that it had "recently explored the possibility of a strategic acquisition". While not citing Chrysler by name, we all know the strategic acquisition in question is the Auburn Hills-based automaker currently owned by private equity group Cerberus Capital Management. Nardelli responds by comically not confirming that his company was GM's target, reiterating for the umpteenth time that Chrysler doesn't talk about its business dealings with other companies because they often lead nowhere, like in this case we suppose. Of course, though his response confirms nothing, its mere existence confirms everything. All Nardelli does say is that Chrysler will continue to explore "multiple strategic alliances" that will aid its own turnaround effort. Carlos Ghosn, the prominent figurehead of Nissan/Renault whose companies were also on the short list of merger partners for Chrysler, should check his voicemail right about now. Check out Nardelli's statement in his own words after the jump.
[Source: Chrysler, LLC]
PRESS RELEASE
Chrysler LLC Statement from Bob Nardelli, Chairman and CEO
Auburn Hills, Mich., Nov 7, 2008 -
Today GM released their third quarter results which included the following statement, I wanted to share with you:
"In addition, we have recently explored the possibility of a strategic acquisition that we believed would generate significant cost reduction synergies and substantially strengthen our financial position in the medium and long term, while being neutral or modestly positive to cash flow even in the near term. While the acquisition could potentially have provided significant benefits, we have concluded that it is more important at the present time to focus on our immediate liquidity challenges, and, accordingly, we have set aside consideration of such a transaction as a near-term priority. We frequently discuss matters of mutual interest with other auto manufacturers and, as a matter of policy, we generally do not comment on these private discussions, which in many cases, do not lead anywhere."
As we have previously stated, Chrysler LLC neither confirms nor discloses the nature of its private business meetings, as many times they do not come to fruition.
Returning Chrysler to profitability continues to be the key focus of the management team. We are significantly challenged by today's economic environment and by the automotive industry's unprecedented downturn. As an independent Company, we will continue to explore multiple strategic alliances or partnerships as we investigate growth opportunities around the world that would aid in our return to profitability.
As we've shared, we appreciated the opportunity to meet with Speaker Pelosi and her leadership team, as well as with Senate Majority Leader Reid to discuss the challenges facing the industry. We are encouraged by their understanding of the importance of the automotive industry to the economy and we look forward to working with them on these issues. We would also like to acknowledge that UAW President Ron Gettelfinger was present at these meetings and added his support.
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Reader Comments (Page 1 of 2)
BigMcLargeHuge 3:37PM (11/07/2008)
Answer the phone, Nissan.
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TJ 3:37PM (11/07/2008)
Well.... GM has a current market cap of $2,428,998,000. Chrysler has a current cash reserve (June 08) of $11,000,000,000
The 'acquisition' technically *could* go the other way....
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MemphisNET 3:59PM (11/07/2008)
Or better yet... Chrysler should buy themselves from Cerberus. At least that way, if they go down, they go down because of their own doing and not some messed-up strip'n flip
TJ 4:16PM (11/07/2008)
Memphis, I am sure you have hear about rumors of an employee-owned company... co-op style. Which has potential, but also tremendous risk and pitfalls.
Now, do I think Cerberus would use its cash on hand to purchase GM? Not likely at all... I'm just sayin' that they could. Ford has a market cap of 4.34B...
Technically, Cerberus could use Chrysler cash to purchase both GM and Ford.... which could create interesting market dynamics...
MemphisNET 6:12PM (11/07/2008)
I have -- at least Chrysler's only undoing would be their own this way -- or more likely, a 80's style gov bailout :D
The whole Cerberus/GM thing just scares me because of the potential of the company disappearing all together. There is so much potential, and things like the Challenger, RAM, remixed interiors for Calibers/Patriots/Compass' etc showing that Chrysler CAN get it right finally.
aa[ro]n 3:44PM (11/07/2008)
Thank god!
Although I hate giving our tax dollars away, I hope the government gives them loans so they all stay afloat. Chrysler has the most money between the two so praise god. We still have the Big 3! Hopefully the new Ram is a sign of Chryslers to come.
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Gabagool 4:07PM (11/07/2008)
I really want to see Chrysler stay independent because it is good for competition. I'd like to see them do "deals" with other companies like Nissan and VW but they should remain independant.
Also this 11 Billion number, first of all Chrysler is a private company for we can not verify that number and #2 Chrysler also burs cash, so is that number still 11B?
Lar 5:04PM (11/07/2008)
"I really want to see Chrysler stay independent because it is good for competition."
Chrysler finds itself in its present situation because of competiton.
extinction is a sort of independence, isn't it
jgp 3:50PM (11/07/2008)
YES YES YES YES
Now for Chrysler to resume talks with Renault-Nissan...
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The Luigiian 4:01PM (11/07/2008)
So, when do we start holding the ticker-tape parades here on Autoblog? I know this is going to make just about every GM and Chrysler fanboy in the country very happy.
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JN 4:16PM (11/07/2008)
I'm all for a Chrysler-Renault-Nissan tie-up. Since GM can't seem to get its act together, it's really the only other combination that makes any kind of sense for "Mother Mopar."
Besides, with Nissan already working on cars for Chrysler, and Chrysler working on at least one truck for Nissan, why the hell SHOULDN'T they take it to the next level?
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Richard S. 7:08PM (11/08/2008)
Chrysler should just import Renault cars and sell under Dodge name...not sure how good they are but probably better than Caliber and Avenger crap.
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The_AirHawk 12:44PM (11/09/2008)
Oh, THAT works! 'specially the last time it happened - why do you think Chrysler got such a bad rep in the early '90s? All the early "Eagle" crap Chryco had to sell until they could be finished with the leftover AMC deals...........
InDetroit 4:51PM (11/07/2008)
The ONLY thing you need to know about Nardelli's "long term" vision for Chrysler is that he is STILL living out of a very nice hotel in a suburb of Detroit. He has no long term desire to fix anything. At this point his focus is getting his money out with a nominal loss.
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westwoodman 4:07AM (12/09/2008)
Having worked for Bob at Home Depot, I can tell you that you only need to know one thing. Ask the question "What's in it for Bob, and you'll have the answer to any question or issue that arises. Bob looks out for Bob, first, last, and everywhere in between. He didn't leave HD with more than $200 million in severance because it was good for HD!
wwm
Lar 5:07PM (11/07/2008)
Just ignore them, Nissan. Just ignore them. The friendless child will stand by your table and stare, but you just keep your head down and eat your lunch.
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Tony 10:51PM (11/07/2008)
Ha, Ha. That has to be the wittiest autoblog quote ever. You should be immediately hired by Barrack as a speech writer. Seriously funny.
Lar 1:23AM (11/08/2008)
Why thank you, Tony. How kind =]
Galley 7:24PM (11/07/2008)
Chrysler to GM: "Don't suck me dry, bro!"
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Joe 8:39PM (11/07/2008)
I saw this news from japanese community.
they says, "it is better situation that Chrysler and GM be a Euthanasia."
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