GM, Ford Could Merge or Form Alliance

[Sal Gerace]

5 hours ago

DETROIT - Executives of General Motors Corp. and Ford Motor Co. have discussed a possible merger or alliance, the trade journal Automotive News reported Monday. Both companies declined comment.

Automotive News quoted what it said were several people familiar with the talks as saying that discussions involving senior executives began in July and are not taking place now.

The journal quoted one source as saying that GM Chief Financial Officer Fritz Henderson and his Ford counterpart, Don Leclair, discussed a GM-Ford alliance in August.

The report comes as GM and Ford have been slashing their work forces and closing plants in efforts to reverse multibillion dollar losses. Their sales have been hurt by competition from more fuel-efficient models from Asian automakers.

As the two biggest U.S. automakers, any deal would presumably face scrutiny by U.S. antitrust regulators.

In July, GM, Renault SA of France and Nissan Motor Co. of Japan announced a 90-day review of an alliance among them.

"As we've often said, GM officials routinely discuss issues of mutual interest with other automakers," GM spokesman Brian Akre said before business hours Monday. "As a policy, we do not confirm or comment publicly on those private discussions, which in many cases do not lead anywhere."

Ford Oscar Suris, also speaking before business hours, said: "We're not commenting on speculation."

Talk of alliances involving GM came after GM shareholder Kirk Kerkorian, who owns a 9.9 percent stake in the company, called for GM, Renault and Nissan to pursue an alliance.

Carlos Ghosn, the chief executive of Renault and Nissan, has said the benefits from an alliance would be similar to the gains from the Renault-Nissan alliance, which have included cost savings from joint purchases of auto parts.

Ford earlier declined to comment on an August Wall Street Journal report that then-Chief Executive Bill Ford approached Ghosn about a Ford alliance with Renault and Nissan.

[Jimi G]

Has anyone else heard anything about this, it kind of seems a little unbelieveable. I just can't make Chevord roll off my tounge, it seems like it would be the equivalent to Superman and Lex Luthor forming an alliance. Anymore information would be greatly appreciated, I am in the Transmission business and knowledge could go along way for me. We were one of the first to find out Dodge was going to stop putting the Cummins eng. in their trucks, and go with a Mercedes eng., the Cummins is going to be put in Fords now, who is part owner of Cummins. jimig@standardtransmission.com

Thanks in advance,
Jimi G.

[bran3b]

I heard rumors earlier today, but nothing as detailed as this. I was told that the story was on msnbc.com, or cnn, something like that.

[Tommy]

A GM - Ford merger reminds me of the old story about Einstein:

Marilyn Monroe suggests to Einstein: What do you say, professor, shouldn't we marry and have a little baby together: what a baby it would be - my looks and your intelligence!
Einstein: I'm afraid, dear lady, it might be the other way around...

There's no guarantee it would produce the best of both.