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Private equity firm Cerberus to acquire Chrysler

francishsu

By francishsu
in Michigan

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monsoon Gigalopolis

monsoon

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Selling it to an equity firm mostly likely means it will be chopped up for the pieces and sold off to the highest bidder. I agree that it doesn't sound good for Chrysler. If you want a good analysis, watch CNBCW tomorrow. (This is the one that transmits from Europe, not the USA one).

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GRDadof3 Ecumenopolis

GRDadof3

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Yes, I was rooting for Magna to take over. Their HQ's are nearby in Canada, they have a big presence in Michigan already, and they are one of the few well run profitable Tier I auto suppliers. They also have experience building cars already.

I can't believe though that it will be the death of Chrylser altogether. It might mean drastic cuts, but isn't that already going on now? My guess is they will streamline the hell out of it and then try to sell it for a profit over the $7 Billion they are paying (probably to someone like Magna). I don't see another automaker being interested in buying just JEEP, for instance. Maybe, I don't know.

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monsoon Gigalopolis

monsoon

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Dr. Z was desperate to get rid of Chrysler. It's cost them dearly over the last 9-10 years. Diamler-Chrysler is going to change its name to just Diamler. They are not going to Diamler-Benz because they don't want to remind anyone this was the most profitable company in Europe prior to the merger.

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RustTown City

RustTown

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I am paraphrasing the German commentator. Reverting the company back to Diamler-Benz would remind people, mainly in Europe, that merging with Chrysler was one of the worst decisions made in corporate history. The present Diamler is worth far far less than the old company and they don't want people reminded of those old days by using they old name. Diamler now finds itself in the position of being a takeover target itself.
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MJLO City

MJLO

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What happens with legacy costs and the like? Really it's the legacy costs stifling the entire automotive industry. Depleting profits and resources for R & D, and competitive pricing for like products. Does Cerberus have any recourse for voiding previous contracts shedding legacies and moving towards competitive profitability? Making Michigans manufacturing labor market more competitive would translate into betterness for everyone state over. Tho it would throw liberals and auto unions into a tizzy and it would screw hundreds of thousands of retirees. I don't see any other way for the American auto industry, and really Michigan itself to stay healthy any other way than something drastic like this.

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RustTown City

RustTown

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Why would they want to? That wouldn't make sense, at all.

MJLO, you better believe that Cerberus, being a private company that wants to turn this back into a money-making company sooner rather than later so that they can flip it, will try whatever they can when renegotiations come back around.

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