The WSJ reports from unnamed sources "familiar with the matter" that GM was in talks with Cerberus to trade the rest of GM's stake in GMAC with Cerberus for the car (not finance) part of Chrysler.
This seems like a bizarre idea to me. GM would be picking up a big portfolio of non-competitive products (Sebring, Caliber, etc.) and redundant products (Ram). GM would also get lots of deflated real estate, such as the sprawling Auburn Hills headquarters, not to mention the plants, such as Belividere, which make the weak products. GM would also wind up with more UAW workers, and more UAW pension obligations. And GM would wind up with Chrysler's dealer network, compounding the problem of having too many dealers making too little money.
But GM's management would have some business reason to want Chrysler, what would those reasons be? Here's my theory.
1) Minivans. GM got killed in the minivan segment, and this would put them back in the game.
2) Truck dominance. GM could kill off the separate Ram platform and sell a Ram based on the Silverado, taking the truck sales crown from Ford once and for all.
3) Jeep. Even though Jeep has been watered down somewhat by Chrysler's attempt to grow Jeep into small crossovers (Compass), it is still a strong brand.
But all of these strengths are in the light truck and SUV sector, precisely where GM is already too heavy. With the coming tightening of CAFE rules, what business case would there be for GM to acquire more trucks and SUVs?
The idea just doesn't make much sense to me, as the armchair CEO.