Private Equity Firm may purchase Chrysler...

[Yellow32]

Check it out:

http://tinyurl.com/3afzfb

TEXT:
NEW YORK (Reuters) - At least four private equity groups have been in preliminary talks with DaimlerChrysler AG (DCXGn.DE) about buying Chrysler, the Financial Times reported on Friday on its website.

Apollo Management LP, the Blackstone Group, the Carlyle Group, and Cerberus Capital Management LP, as well as several European firms, were contacted about their potential interest in buying the company's loss-making U.S. arm, the paper said, citing people familiar with the matter.

The buyout firms were contacted before last week's announcement by DaimlerChrysler that "all options are on the table" for the unit, the paper said, adding that the discussions continued after the announcement.

In New York Apollo, Blackstone, Carlyle and Cerberus could not immediately be reached.

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This is much more likely than a GM buyout.

GM doesn't need a bunch of duplicate franchises or production capacity.

-J

 

[PatentLaw]

If that happens, the buy out firms strip out the pieces, sell them off and trash the rest. The end of Vipers as we know them. Dodge will be off the map. Hope that it does not happen.

 

[Yellow32]

If that happens, the buy out firms strip out the pieces, sell them off and trash the rest. The end of Vipers as we know them. Dodge will be off the map. Hope that it does not happen.

Agreed,

My concern is this will go down before the 08 Viper is produced. I don't consider the 08 Viper a lock by any means at this point.

-J

 

[rcdice]

If that happens, the buy out firms strip out the pieces, sell them off and trash the rest. The end of Vipers as we know them. Dodge will be off the map. Hope that it does not happen.

Not necessarily. ANY buyer of the Chrysler/Dodge/Jeep brands is going to look for ways to cut costs (labor, health care, duplications, etc.). Unfortunately, unprofitable models fall into that category as well. Hopefully, the Viper's "iconic/halo car" status would let it survive.

If this thing goes private equity, they will cut costs, firm up the brands, return the company to profitability and then take them public again. Going public (issuing stock) will be their carrot at the end of the stick. By doing that, they will have to service debt between now and then but not necessarily pay it off. CDJ will be brought public, profitable and with the standard mounds of debt.

 

[Jay Herbert]

A huge part of DCJ's current problems can be related to one person, who has departed to work for a Mercedes Dealership in NY. the inventory build (including the over production of Vipers) can be 100% laid at his feet. It would be awful if DCX would sell DCJ to a private equity firm because of this one individuals actions .

Under normal conditions, DCJ is profitable. Did anyone hear the same "All options are on the table" when DCJ was supporting the issues at Mercedes Merger of equals...LOL

The unions need to allow DCJ to address contracts that pay hourly workers wages that are out of line with similar jobs in the rest of the economy. They need to be willing to relocate plants to states that have lower costs of living, and as such, lower wages that lead to a higher standard of living (this cannot be done to any benefit with the current union contract). States like MI need to address the high cost of doing business and the high level of tax burden they place on companies and individuals.

There is a HUGE American Auto Industry, sadly it is rapidly becoming Toyota, Honda, Hyundea, BMW, etc..... It is located in Alabama, TX, and other states in the deep south... (some deeper south, i.e. Mexico )

If GM, Ford and DCJ do not get the Union to understand very soon, quit paying people huge severance packages to "leave" (when they leave, they often become part of the pension burden), and even worse, paying people "not to work" (job banks), they all will be no-more.

Watching the Big Three commit suicide is very depressing.

Watching American manufacturing die is even more depressing.

Watching our standard of living move offshore to China is the most depressing of all.

Just my humble opinion.

 

[Go Fast For Life]

Watching the Big Three commit suicide is very depressing.

Watching American manufacturing die is even more depressing.

Watching our standard of living move offshore to China is the most depressing of all.

Just my humble opinion.

I couldn't have said it better myself. When is everyone going to realize that a global economy means a global standard of living- - which is not a good thing for the US!

 

[Camfab]

A huge part of DCJ's current problems can be related to one person, who has departed to work for a Mercedes Dealership in NY. the inventory build (including the over production of Vipers) can be 100% laid at his feet. It would be awful if DCX would sell DCJ to a private equity firm because of this one individuals actions .

Under normal conditions, DCJ is profitable. Did anyone hear the same "All options are on the table" when DCJ was supporting the issues at Mercedes Merger of equals...LOL

The unions need to allow DCJ to address contracts that pay hourly workers wages that are out of line with similar jobs in the rest of the economy. They need to be willing to relocate plants to states that have lower costs of living, and as such, lower wages that lead to a higher standard of living (this cannot be done to any benefit with the current union contract). States like MI need to address the high cost of doing business and the high level of tax burden they place on companies and individuals.

There is a HUGE American Auto Industry, sadly it is rapidly becoming Toyota, Honda, Hyundea, BMW, etc..... It is located in Alabama, TX, and other states in the deep south... (some deeper south, i.e. Mexico )

If GM, Ford and DCJ do not get the Union to understand very soon, quit paying people huge severance packages to "leave" (when they leave, they often become part of the pension burden), and even worse, paying people "not to work" (job banks), they all will be no-more.

Watching the Big Three commit suicide is very depressing.

Watching American manufacturing die is even more depressing.

Watching our standard of living move offshore to China is the most depressing of all.

Just my humble opinion.

I understand much of what your stating Jay, but this constant lead to union jobs being the root of the problem is really annoying. The real problem is that GM, Ford, Chrysler are not selling product. Many of other foreign companies you mention produce cars in the US and are doing quite well. The reason is simple.....they are selling cars. US manufacturers have NEVER understood how to design and produce a decent small car. Chrysler produces the widest variety of tasteful cars in the industry, but replaced their only fuel efficient car (Neon) with another useless SUV! The Neon was certainly outdated and lacked quality, but to replace it with another SUV was just foolish. What really has to happen is that management should be cut in half. Cut out all the 2 hour company lunches and golf games. Someone with some serious BA!!$ needs to come in and clean house. I'm certain that there are consessions that need to be addressed by the unions, but why do you have to punish a person who's given a specific task to do. That task is ultimately reflecting the quality of the product.

The point in life is to move forward and better yourself, and the ones around you. The union worker has no means of making descisions that will affect the product other than doing the best possible assembly of what is given to him or her. Management is the problem. Why? because all they, and when I say they, I mean individuals care about is themselves. How am "I" going to rake in the dough. As long as "I" make a ton of cash with all the perks "I'M" good. That's the problem. Until that greedy way of thinking changes this country is going to see some bad times.

It's the heads of companies that are selling out manufacturing in this country. It's consumers like many of you that shop at stores like Harbor Freight because you want to pay $50.00 for a floor jack that's made in China. Then you turn around and complain that American manufacturing is going away, and people should lower their standard of living and work at wonderful stores like Wal-Mart.

This is not directed at you Jay, but I had to say something because I hear this all the time. I'm not your average rich Viper owner. I work 70-80 hours a week in a union job. I buy American products regardless of cost. My shoes are US made New Balance, my tools are ALL made in USA. I make every effort in my life to support American jobs. I may not make on tenth of what many of you make but I'M an AMERICAN and I love this country and what it has stood for.
Wake up people, your descisions in life will directly affect the future of this country.

 

[AviP]

Unions are part of the problem, not the whole problem. I have no solution for the union problems other than asking employees to dump their union. But that's not going to happen.

Management vision, or lack thereof, is the other. American tastes have evolved to like everything big, the fast food phrase "supersize me" is reflective of our lifestyles. Our cars keep getting bigger in exterior dimensions, engine sizes but the number of seats stay the same, usually 5 while fuel mileage has decreased or stayed constant as a result of more efficient engines. The trend is suicidal. Bigger is not better and we are learning that the hard way.

Also, there is too much product change from year to year, mostly cosmetic. I think focusing on reliability instead of cosmetics is the key. That is how Toyota, Honda and Nissan have gained such a foothold in the US market.

Toyota also has a low 5-day inventory supply chain that makes it very efficient. I think that all automotive firms need to reduce their parts by standardizing components across different platforms. e.g. Why does a passenger seat need to be different across every model when it's my ass sitting in all of them. Design one non-power seat, another powered seat and a third race seat. These should then be used across every platform that uses a passenger seat. Obviously, they would require different mounting brackets for different platforms. Same for say the steering wheel. Why does it have to be different from vehicle to vehicle? Have 3 styles: standard, luxury and sport. Voila!

While this might make the interior of cars more similar looking, it will improve quality, reduce recalls and increase the bottomline. You wouldn't have a situation where a new brake light switch failed and caused a 500,000 car recall because that brake light switch has existed in the fleet for a decade and needs no development.

Remember that skateboard chassis concept unveiled by GM(?) a while back. It showed how they could make any model fit on the same platform. I am talking about expanding that logic to the current parts inventory.

IMHO, parts standardization should be the next big automotive news if the manufacturers survive their losses and subsequent buyouts.