# GM - Renault Partnership?



## Jutcho (Aug 25, 2004)

Paddington said:


> Holy shit, that's absolutely disgusting. I don't want any foreign automakers buying a piece of GM.


You get everything wrong because it's clearly GM through Kirkorian who's asking for help from Renault-Nissan, since their alliance is one of the most profitable ever in the car industry. So please stop saying it's disgusting without having a proper thought on the situation first (unless you meant that it's Kirkorian who's disgusting, since he is the one who's calling for foreign car manufacturer's help).


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## Paddington (Mar 30, 2006)

Jutcho said:


> You get everything wrong because it's clearly GM through Kirkorian who's asking for help from Renault-Nissan, since their alliance is one of the most profitable ever in the car industry. So please stop saying it's disgusting without having a proper thought on the situation first (unless you meant that it's Kirkorian who's disgusting, since he is the one who's calling for foreign car manufacturer's help).


Umm... It has nothing to do with help. Kerkorian is an investor whose 89 years old and wants to make a quick buck on the $1.5 billion worth of GM shares he holds, which so far has not materialized. He's twisting GM's management's arm to issue $3.0 billion worth of new shares, half of which will be purchased by Renault and the other half by Nissan. Together, Kerkorian, Renault, and Nissan will form a potent voting block of 30%, which will give them effective management control over GM (Ford owns about 30% of Mazda and effectively runs the company this way).

Certainely, Rick Wagoner was not the one who went to Nissan to propose a partnership. The news announcement hit GM management like a ton of bricks. They can't come out and just say "No" to the whole deal, because Kerkorian owns 10% of the company, has a man on the board, and that gives him significant clout. When he makes a proposal the management has to listen to it.

But the word coming out of the GM building in Detroit is not positive. They don't want these corporate raiders to gut the company, and destroy the livelihoods of hundreds of thousands of American workers by bluntly wielding cost cutting as a profit enhancing tool, which is Renault chief Carlos Ghosn's specialty. 

Rick Wagoner hasn't generated gigantic profits for GM or massive returns for stockholders (I would know, I hold GM stock), but many credit him as a man who is fixing the organization while keeping in mind the welfare of the many hundreds of thousands of people who have ties to GM, as well as improving GM's product lineup, and its overseas presence. I prefer that to Carlos Ghosn blunt, wreckless cost cutting (like moving Nissan's U.S. offices from LA to Tennesse purely to save on rent, which made 2/3 of the workers leave the company).


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## Paddington (Mar 30, 2006)

boricuba said:


> This move made by GM is very calculated. GM wants to still consolidated itself as the mayor car producer in the world. GM is very scare of Toyota which is growing to overtake GM car production soon. GM has mayor problems in the North american division where sales slip almost 30%. North America is GM biggest market and lucrative so it is very important for GM to Innovate. In the Rest of the world GM is in fact doing pretty good and above expectation they own stakes in many foreign car makers and own Subaru, Saab, Opel, Scania, Isuzu, Stakes in Mitsubishi etc.. GM is most interesting in Nissan which is own by Renault. Nissan U.S sales have grown 20% is one of the most succesful foreing car makers in the U.S because of great design and Innovation and Luxury line like Infinity which is second to toyotas Lexus. GM will go ahead with alliance with reanault in a couple of years when north america division is profitable again they will merge and own renault group including nissan.


Umm... The deal was not proposed by GM. The company's management learned about it the same time the general public did. Kirk Kerkorian has been holding secret meetings with Carlos Ghosn over the past few months hatching a plan to sieze control of GM, which is something Kerkorian tried - but failed to do - in the 1990's with Chrysler. He's a corporate raider who likes to go in for the kill.


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## Cloudship (Jun 8, 2005)

GM supposedly has known about this for some time, but has been sitting on it. This is a prompt to action. I won't say that GM is totally uninterested, but I do think they are hesitant.

Just a couple of observations - first, GM is hardly the working man's champion - they have closed more plants in the US than anyone else, and it's the foreign companies that are actually opnening up and hiring US workers. Also, GM is not doing badly in North America. Where they are hurting is Europe (supposedly turning the corner there) but more importantly Asia, where they have very little presence. 

Also, GM no loner has any stake in Subaru/Isuzu (Fuji). That is now with Ford. But they do own Daewoo.


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## Paddington (Mar 30, 2006)

Cloudship said:


> GM supposedly has known about this for some time, but has been sitting on it. This is a prompt to action. I won't say that GM is totally uninterested, but I do think they are hesitant.
> 
> Just a couple of observations - first, GM is hardly the working man's champion - they have closed more plants in the US than anyone else, and it's the foreign companies that are actually opnening up and hiring US workers. Also, GM is not doing badly in North America. Where they are hurting is Europe (supposedly turning the corner there) but more importantly Asia, where they have very little presence.
> 
> Also, GM no loner has any stake in Subaru/Isuzu (Fuji). That is now with Ford. But they do own Daewoo.


Jesus, almost every single statement you've made is incorrect. I don't know where to begin. :bash: 



> GM supposedly has known about this for some time, but has been sitting on it.


No proof of that. In fact the evidence suggests they were quite shocked when Kerkorian sneakily leaked one of his letters to the press.



> Just a couple of observations - first, GM is hardly the working man's champion - they have closed more plants in the US than anyone else


You do realize that any GM factory worker who is laid off gets put on the jobs bank program, for which they collect about $65,000 a year with full benefits and pension for not doing any work. It's a major drain on the company. Other than Ford and Chrysler who abide by the same UAW agreements, no other company in America gives that kind of deal to laid off workers. And most of the plant closings in the last 5 years have been on account of attrition, with people retiring and the remaining workers moving to different plants or going on the jobs bank. Effectively, no GM factory worker has been laid off in decades, because they continue to collect full salary on the jobs bank.



> Also, GM is not doing badly in North America.


Their problems with profit are almost entirely due to the billions they are losing in North America.



> Where they are hurting is Europe (supposedly turning the corner there)


GM Europe isn't making huge bucks, but it's no longer losing massive amounts of money either.



> but more importantly Asia, where they have very little presence.


Yeah right, you know nothing. This is GM's most successful and most profitable division right now, thanks to booming sales in China, a mighty turnaround of GM-Daewoo in Korea, and a strong showing by Holden in Australia. Really, you know *nothing* about GM.



> Also, GM no loner has any stake in Subaru/Isuzu (Fuji). That is now with Ford.


GM dumped their stakes in Subaru and Isuzu, but neither of those companies have tie ups with Ford. :bash: 

Seriously, your data is so bad it's not even funny. And I'm not even an automotive analyst, just a guy who reads car magazines and the occasional financial statement.


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## samsonyuen (Sep 23, 2003)

GM's Subaru stake has been sold to Toyota, but not Isuzu.


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## samsonyuen (Sep 23, 2003)

From: http://www.nytimes.com/2006/07/13/business/13cnd-auto.html?_r=1&oref=slogin&pagewanted=print
____________________


> July 13, 2006
> Chief of Nissan and Renault Details G.M. Proposal
> 
> By MICHELINE MAYNARD
> ...


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## samsonyuen (Sep 23, 2003)

From: http://uk.biz.yahoo.com/16072006/323/toyota-eyes-alliance-gm-report.html
____________________________________


> Sunday July 16, 04:45 AM
> Toyota eyes alliance with GM: report
> 
> CHICAGO (AFP) - Japanese auto giant Toyota Motor (Stuttgart: 853510 - news) is considering proposing an alliance with General Motors (NYSE: GMW - news) to prevent its US rival from forming a three-way tie-up with Renault (Paris: FR0000131906 - news) and Nissan, BusinessWeek magazine has reported.
> ...


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## AltinD (Jul 15, 2004)

And so the war over crap begins ...


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## samsonyuen (Sep 23, 2003)

From: http://www.forbes.com/business/manufacturing/2006/07/17/gm-nissan-toyota-cx_po_0717gm.html
____________________________


> Toyota Leaving GM To Nissan
> Parmy Olson, 07.17.06, 11:20 AM ET
> 
> Toyota Motor today denied published reports that it would seek to break up the budding romance between General Motors and the Nissan- Renault alliance, saying it was not considering a takeover of the leading U.S. automaker.
> ...


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## samsonyuen (Sep 23, 2003)

From: http://money.cnn.com/2006/07/17/news/international/gm_toyota/
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> Report: Toyota denies possible GM alliance
> Is the Japanese automaker looking at possibly hooking up with GM, or isn't it?
> July 17 2006: 9:15 AM EDT
> 
> ...


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