The New York Times asked Thursday morning whether Carlos Ghosn, the chief executive of Renault and Nissan, will try to buy Chrysler. It is an absurd notion, which luckily The Times admits is a far-fetched idea. However, the story moved forward probably because executives at DaimlerChrysler didn't outright dismiss it, instead saying the company would explore all possible means to reinvigorate the ailing U.S. brand. The Times notes that the current attempt to restructure Chrysler is the second in six years.
Interestingly, the last time Chrysler was under the microscope, the press speculated that DaimlerChrysler might amputate the Jeep brand. The favored buyer reportedly was GM, who was slated to receive a cash influx from the pending sale of DirecTV parent Hughes Aerospace. The logic was that GM would use the proceeds to finance the purchase of Jeep. However, there was a flaw in the logic. At the time, GM was introducing the Hummer H2, a consumer-oriented version of the military vehicle. Although Jeep had nothing quite as large, the Hummer lineup could eventually be positioned to go face-to-face with Jeep with the introduction of additional models, which has followed in the subsequent years. In addition, GM had — and still does have — a wide selection of SUVs throughout its nameplates. Therefore, adding Jeep would have been redundant.
Similar circumstance could be said for Nissan-Renault. Between its namesake brand and its Inifiniti lineup, does Nissan really need to add Chrysler, Dodge and Jeep to its stable? What would these additional brands offer Nissan-Renault? Not much other than a collection of fuel hungry SUVs and large engined sedans. Even if Ghosn used the acquisition to simply expand North American operations with a cutback in models, he'd be stuck with legacy contracts with the UAW at the former Chrysler facilities.
Ghosn's plan to establish an alliance with GM was a totally different arrangement. Instead of being saddled with labor issues, GM would have retained ownership of its facilities. Instead, the alliance reportedly was more about sharing technologies, parts and other intellectual properties. An outright Nissan-Renault acquisition of Chrysler would still net some new intellectual properties, but it probably would not be enough to offset the problems it would create for Ghosn. So to answer The Times' query: Probably not. —Matthew Wurtzel
See story from The New York Times
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