Chrysler Update: GM Gets Some Serious Competition

[Perian]

Link: http://autonews.com/apps/pbcs.dll/se...55E7AFFAD348F1

Magna hoardes cash with eye toward Chrysler

Fourth quarter net income plummets; dividend cut by half.

Magna International Inc. is hoarding cash as it considers a bid to buy the Chrysler group. Magna founder and Chairman Frank Stronach met twice last week with the leadership of the Canadian Auto Workers union to discuss Chrysler, CAW President Buzz Hargrove said today.

Hargrove declined to disclose details of the talks. But Hargrove said Stronach is a strong-willed executive who usually achieves the goals he sets.

More at link.

[Perian]

Note:

Magna is a Chrysler component supplier.

They get about 25% of their business from Chrysler.

.

[sigma]

And its reasonable to assume they don't want that business going to Dephi. Still I'm not sure how they can compete with GM on this offer though. It will make things interesting, that's for sure.

[BurnOut]

Originally Posted by Perian

Note:

Magna is a Chrysler component supplier.

They get about 25% of their business from Chrysler.

.

Geez... that's pretty crazy.

[PhishPhood]

Baby Bell buying out AT&T?

Weird stuff.

Your 14 y.o. son comes home from a weekend at his cousin's house and says "Mom & Dad, Uncle Jimmy is lending me the money to buy this house from you. After I buy it you've got 2 weeks to find your own place."

[HoosierRon]

From Magna's annual report:

YEAR ENDED DECEMBER 31, 2006
We posted sales of $24.2 billion for 2006, an increase of 6% over 2005. This higher sales level was achieved as a result of increases in our North American, European and Rest of World production sales, our complete vehicle assembly sales, and our tooling, engineering and other sales.
During 2006, North American and European average dollar content per vehicle increased 6% and 14% respectively, over 2005. During 2006, North American and European vehicle production declined 2% and 3% respectively, compared to 2005.

Complete vehicle assembly sales increased 7% to $4.4 billion for 2006 compared to $4.1 billion for 2005 and complete vehicle assembly volumes increased 8% to approximately 248,000 units.

Our operating income was $792 million for 2006 compared to $942 million for 2005, and we earned net income for 2006 of $528 million compared to $639 million for 2005. Diluted earnings per share were $4.78 for 2006 compared to $5.90 for 2005.

...

We are the most diversified automotive supplier in the world. We design, develop and manufacture automotive systems, assemblies, modules and components, and engineer and assemble complete vehicles, primarily for sale to original equipment manufacturers of cars and light trucks in North America, Europe, Asia, South America and Africa. Our capabilities include the design, engineering, testing and manufacture of automotive interior systems, seating systems, closure systems; metal body and structural systems; vision and engineered glass systems; plastic body, lighting and exterior trim systems, various powertrain and drivetrain systems; retractable hard top and soft top roof systems; as well as complete vehicle engineering and assembly.

We have approximately 83,000 employees in 229 manufacturing operations and 62 product development and engineering centres in 23 countries.

http://phx.corporate-ir.net/phoenix....537&highlight=

[neshapop]

I posted this story from CBC yesterday...

[likearock00]

Let them have it!! GM is in no position to deal with Chrysler right now...

[nadepalma]

Yeah, we heard they were thinking about making a move, but nothing about them hoarding cash until this (at least I didn't hear of anything til now).

[likearock00]

Originally Posted by neshapop

I posted this story from CBC yesterday...

Doesn't matter until you-

[neshapop]

Originally Posted by likearock00

Doesn't matter until you-

Whatever. I read somewhere that Magna had some design studio and had an appetite to become a carmaker.
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[Ambalanche]

Originally Posted by likearock00

Let them have it!! GM is in no position to deal with Chrysler right now...

No doubt!! Please Magna, Buy Chrysler!! I just hope GM isn't stupid enough to get in some kind of bidding war!

[gardnet1]

Magna specializes in small production lots, such as PT cruiser/Jeep Liberty production in Europe. They acquired similar competitor steyr about 2-3 years ago.

[FunkyPig]

This would be good also, as once more there would be three American car co.'s.

[HoosierRon]

Look, the Magna Magnum: