GM-Chrysler Merger May Get Labor Savings, New Loans
Oct. 20 -- General Motors Corp., the largest U.S. automaker, may be able to win new labor savings and bank loans as part of a merger with Chrysler LLC, a JPMorgan Chase & Co. analyst said.
A GM-Chrysler tie-up would be a ``high-risk'' deal, with the benefit being leverage over the United Auto Workers and lenders, Himanshu Patel in New York wrote in a report today. Cerberus Capital Management LP, which bought Chrysler last year, is in talks with GM and other automakers about a merger, people familiar with the talks have said.
``By saving Chrysler from a liquidity event, GM may also be able to get itself much needed secured bank financing from the same banks that are currently holding Chrysler debt,'' wrote Patel, who rates Detroit-based GM as ``overweight.''
GM and Chrysler are exploring a merger as rating companies such as Standard & Poor's predict the automakers may run out of cash in 2009. Chrysler, No. 3 in the U.S., has said it won't make money this year, and GM has lost almost $70 billion since posting its last annual profit in 2004. Dwindling U.S. demand may push industrywide sales next year to the lowest since 1991.
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Am I the only one that all of this is making me sick? It's all about saving GM and costing up to 40,000 jobs! I was really looking forward to the new stuff coming out of Chrysler in the next few years like the Phoenix engines, the EV vehicles, the Getrag transmissions and the Hornet. But now all of that means nothing now. Chrysler was bragging about this awesome roll out that they were going to do in 2010, but now there may not even be a Chrysler or Chrysler Dealerships to service our NITROs!
Nitro Year: 2007 (1 of 91,815 sold in 07)
Nitro Model: R/T 4X4 Stone White
CAT-BACK Exhaust, CAI, Projector Head Lamps
Fully-Equipped w/all factory options