In its restructuring plan submitted to the Treasury late Tuesday, Chrysler LLC said that it believes that the “best option for the U.S. auto industry” would be a GM/Chrysler merger. Chrysler, which is also pursuing an alliance with Fiat SpA, said that consolidation among U.S. automakers and their brands is a strong way to sustain the auto industry.
Chrysler’s restructuring plan called for an additional $2 billion loan on top of its $7 billion loan request. General Motors, which asked the U.S. Treasury for an additional $16.6 billion, did not express any hint of its interest in merging with Chrysler.
Chrysler said it has had discussions about a possible merger, but the talks were taken off the table by GM. The Auburn Hills automaker made it clear that savings from a GM/Chrysler merger would be at least five times more than Fiat deal. It said that a merger between the two automakers would generate at least $36 billion in cash and boost operating earnings by $40 billion.
However, let’s not forget that a GM/Chrysler merger would cost about 35,000 jobs, including as many as 25,000 jobs in Michigan alone. Not to mention GM has shown no interest in a possible merger with another automaker as it looks to cut down brands.
In their plans submitted to the U.S. Treasury, GM said it is looking to cut 47,000 jobs worldwide by the end of this year while Chrysler plans to cut 3,000.
Source: Detroit Free Press