WSJ: GM MAY SHARE LARGE SUVs WITH CHRYSLER

[Perian]

Link: wsj.com

GM, Chrysler Explore SUV Tie-Up

By GINA CHON - February 15, 2007 11:04 a.m.

DaimlerChrysler AG's Chrysler Group and General Motors Corp. are in talks to jointly develop a large sport utility vehicle like the Chevrolet Suburban, which Chrysler doesn't have in its current lineup.

The talks have been going on for six months and no conclusion has been reached yet, said a person familiar with the situation. If a deal is reached, it would save development costs for Chrysler, which had a $1.5 billion operating loss for 2006.

"Sometimes we can't do vehicles affordably so this would be a strategic partnership," the person said.

[Perian]

Before any of you go crazy with replies, think for a moment.

This could be a way to keep the GM GMT900 production lines moving.

A few thousand "Chrysler Suburbans" a year could put a lot of money in the Bank of GM.

Never work? Let's see what happens to the new Chrysler/VW minivan.

.

More importantly - I think this puts to rest the "GM is buying Chrysler" rumors of late...

[BurnOut]

NO WAY would GM give away what is currently one of their marquis products that they put so much time and money in to.

[jbartley]

this makes NO SENSE!

Why would GM want to risk diluting their market share to a competitor?


Note to Chrysler: GO PLAY WITH NISSAN!

[starlightmica]

This could be a way to keep the GM GMT900 production lines moving.

Assuming that demand holds up, yes. I can see how this fits with Chrysler closing their Newark, Delaware plant where the Durango and Aspen are being built it smaller and smaller quantities.

[Recxjake]

I'd be ok with them keeping their designs and using GM plants for extra $$

[dav305z]

Originally Posted by Perian

Before any of you go crazy with replies, think for a moment.

This could be a way to keep the GM GMT900 production lines moving.

A few thousand "Chrysler Suburbans" a year could put a lot of money in the Bank of GM.

Never work? Let's see what happens to the new Chrysler/VW minivan.

.

More importantly - I think this puts to rest the "GM is buying Chrysler" rumors of late...

You have a point, but I don't see how proliferating more models will move more metal. The large-SUV market is clearly shrinking, and any more models will just be robbing Peter to pay Paul.

Besides, if GM is really insistent on more versions, they have a billion of their own brands to water down. Pontiac G11 anyone?!

[ScottS]

Originally Posted by jbartley

this makes NO SENSE!

Why would GM want to risk diluting their market share to a competitor?

Well, if you think about it, either way, GM is selling a vehicle, and it's the bottom line that speaks volumes.

[mgescuro]

I think it makes sense. DCX and GM have been partners in the past, so I don't see why not.
Full sized SUVs are a dying breed. If GM can realize faster returns on the platform, the better.

We'll see.

What does GM get in return? Chrysler has nothing that GM needs.

[tgagneguam]

Originally Posted by Perian

Before any of you go crazy with replies, think for a moment.

This could be a way to keep the GM GMT900 production lines moving.

A few thousand "Chrysler Suburbans" a year could put a lot of money in the Bank of GM.

Never work? Let's see what happens to the new Chrysler/VW minivan.

.

More importantly - I think this puts to rest the GM is buying Chrysler rumors of late...

How would giving a key competitor access to a market presently dominated by GM by giving them a vehicle that they don't have be a winning situation for GM? I'm not convinced the number of vehicles moved by Chrysler would affect the production line in a manner that would generate the revenue/profits that this setup promises. If you're going to buy a Chrysler GMT-900, you might as well buy one of the Real McCoys: one of Chevrolet's, GMC's or Cadillac's versions.

As you can tell, I'm skeptical of this idea.

[member12]

Don't trash a good GM nameplate by letting Chrysler put a badge on it.


NOOOOOO! DON'T DO IT.


Expand the lambda production line in the future while cutting the T900 SUVs. What makes anyone think Chrysler can sell a GM truck any better than GM can sell one?

There is nothing in this whole thing for GM. Associating yourself with Chrysler is a horrible idea. Chrysler makes crappy products.

[JM9777]

Would Chrysler have to put sharp-edged hard shiny gray plastic all over the interior of their version?

I say don't do it GM....if they want to sell a large SUV, make them develop their own. I don't think GM is that desperate for cash.

[Perian]

[quote=dav305z]You have a point, but I don't see how proliferating more models will move more metal. The large-SUV market is clearly shrinking, and any more models will just be robbing Peter to pay Paul.
QUOTE]

Your point is crystal clear, but look at it this way:

I have friends who own Chevy product that would never step foot into a Ford dealer, and others who own Ford product that would never step into a Chevy dealer.

There must be a certain element of the population who will only buy DCX product - thus here is a chance for GM to rope in a prospective buyer that is out of its' reach.

.

.

[AndrewGS]

Not gonna happen.

[VibenPontiac]

Originally Posted by JM9777

Would Chrysler have to put sharp-edged hard shiny gray plastic all over the interior of their version?

I say don't do it GM....if they want to sell a large SUV, make them develop their own. I don't think GM is that desperate for cash.

GM does need lower costs though and with the SUV clearly seeing reduced demand the cost of developing the next generation of full sized SUVs could be prohibitive for GM to do alone. This could be a way to spread out the cost of developing the full size SUV.

Not sure its a good idea or not but I'll wait for further details to comment for an opinion on whether or not the idea makes complete sense or not though.

This is what the German magazine must have picked up on yesterday - someone heard about this partnership and connected it to the wrong dot.