Commentary: The GM-Nissan-Renault Alliance

[mgescuro]

Originally Posted by caling7

You're funny........ or just incredibly stubborn. I think you understand what I'm saying but just don't want to admit it.

Oh I understand what your'e saying.
You're saying that there are synergies to be had... down the road.
What I'm saying is that there are ZERO short-term gains/synergies to be had.. and the ability to realize long-term gains/synergies is a big question mark.

There's a chart showing market penetration in global market segments. GM leads in all but 1 -- Japan. Japan is an impenetrable market. Gains cannot be had there without a total acquisition of a Japanese car maker. So, I see no reason why Renaltu-Nissan would benefit GM in any way.

Originally Posted by caling7

No, R-N wouldn't have any influence on the IMMEDIATE future, but the synergies would come in about 4-6 years. Future. Future. Future. And no, Future is not limited to Epsilon II and the HF engines.

What I'm saying is that this isn't a given. It could happen. But GM's engineering and R&D is far more diverse and larger than R-N, that R-N really cannot contribute anything significant to what GM ALREADY HAS IN PLACE. I don't care if it's 5-10-15 years down the road.

Originally Posted by caling7

But I've also read many, many articles that detail how companies such as Toyota and Honda, and maybe even Nissan spend more as a percentage of their budgets on R/D, and also more in total per vehicle. Since GM has so many brands and models they have to spread their R/D budget a little thinner. And that's why foreing brands often come out with model changes a lot faster than GM and can refine them more, or add more content much of the time. Wouldn't GM benefit from the addition of R-N's R/D budget as well, a combination thereof, or the savings from their merger (the R/D budgets, not the companies)? Just a thought.

That's the old GM. 1 Epsilon platform... 4 different variants. None of which can be built in each other's plants. That's inefficient.
GM's R&D budget is massive. learning how to spending is more wisely, as they have, will be a benefit.
Again... they don't need R-N at all.

You're also failing to realize that GM has its own processes and culture. Learning to work with the French and yet another Japanese company will disrupt operations. That's a fact of human nature.

GM can't afford to have any disruptions to their turnaround.

So, I satnad by everythign I've said. No synergies.

[caling7]

Very well......... agree to disagree, I guess. At least we all agree that we don't want this merger/partnership to happen, even if it's for different reasons.

[Bravada]

You're also failing to realize that GM has its own processes and culture.

Actually from what we've been seeing, this could actually use a HUGE shakeup, or "creative destruction".

[mgescuro]

Originally Posted by Bravada

Actually from what we've been seeing, this could actually use a HUGE shakeup, or "creative destruction".

Change takes time.
You can't walk into a company, demand a change in corporate culture, and expect people to accept it.
You're gonna lose a TON of people.

Hell.. maybe GM's HQ will move to Nashville.

[Kheiron]

Originally Posted by mgescuro

Change takes time.
You can't walk into a company, demand a change in corporate culture, and expect people to accept it.
You're gonna lose a TON of people.

Hell.. maybe GM's HQ will move to Nashville.

now wouldn't that send shockwaves through the industry. Heck Detroit may lost its Motor World Capital title kind of like the state of Michigan lost the title for being the Boat capital of the nation to Fla., which had more boats registered in their state this year than MI. Its almost like we're trying to predict another "Black Tuesday" or something with this merger, which could have astonishing effects in either direction. Again, we don't know all the details and speculating is almost futile without knowing the facts and the content of the discussions as well as other "relevant" information.

The bottom line is we need to do whats fiscally responsible and in the best interests of making GM "The" premier world class company that sets the benchmark with every product it makes; short term, but also, more importantly, long term. What sets the company up for dominating the world market for the rest of this century.

[mgescuro]

Originally Posted by Kheiron

now wouldn't that send shockwaves through the industry. Heck Detroit may lost its Motor World Capital title kind of like the state of Michigan lost the title for being the Boat capital of the nation to Fla., which had more boats registered in their state this year than MI. Its almost like we're trying to predict another "Black Tuesday" or something with this merger, which could have astonishing effects in either direction. Again, we don't know all the details and speculating is almost futile without knowing the facts and the content of the discussions as well as other "relevant" information.

The bottom line is we need to do whats fiscally responsible and in the best interests of making GM "The" premier world class company that sets the benchmark with every product it makes; short term, but also, more importantly, long term. What sets the company up for dominating the world market for the rest of this century.

Fact is... GM's corporate culture is already changing. changing it again can only be detrimental to the process.
Moving the company from Detroit to say Nashville, you lose a ton of people. You lose the brain trust. People are what make GM what it is. Nissan lost what.. 60% of its staff moving to Nashville? Completely stupid. How much further behind is the company now that all these peopel are gone? They have to waste time, rebuilding processes, relocating people, building a new campus, etc etc etc. Saving money on the front end, but you lose so much more in the backend.

I don't believe this Alliance is "fiscally responsible" to GM. It's fiscally rewarding to one person only... Kerkorian.

[ChevroletRevived]

True. GM IS turning around, and the culture is changing. That was a very stupid move for Nissan to move the HQ to Nashville. This alliance is only adding length and weight to the ship we're trying to turnaround.

[Bravada]

Well, if moving to Nashville would mean losing people like Lori Queen or Mark LaNeve (and I believe there are many gals and guys similar to them on all levels of GM hierarchy), and in general losing some of the bloated white collar staff, that wouldn't be bad at all. The problem is that most of GM's executives are homegrown, and as such parts of the system. They won't destroy the system that prodded them were they are. They are entangled in internal relationships.

EDIT: I didn't mean "moving to Nashville" as "merging with Nissan". I meant "some big shakeup that would really mean the end of the old GM world".

[def]

[quote=jbernie]I think GM is in a position where it doesn't need a merger or alliance of this nature. Defiunately GM could benifit from the ultra efficent euro diesels but that is about all.


After spending the last year in europe, ive decided that the "ultra efficent euro diesels" are not that great, most of the ones ive seen over a year or two old spew huge clouds of black smoke and the BMW 5 diesel had almost nothing for power. the only fuel efficent diesels are the one with no power

[DanCBJMS1988]

When I contemplate the GM/Renault-Nissan thing more and more, BL screams in my head. Yes, in its MGR incarnation, it was the last volume-car manufacturer the UK had, and it blew it; but still:

*Does BL have any rememborable models after the merger bar the Mini on the BMC side of the ol' BMC-Leyland merger way back when? Maybe the Landcrab, but that was already on the books beforehand. Maybe the Maxi, but it was an Issigonis design and was already on its way before. Maybe the horrendous trio of Metro, Maestro, and Montego, which destroyed the Austin brand and provided a springboard for the revitalization of the MG brand. Maybe the Marina/ITAL, but how many of them do you see on British roads today? Honestly, I can't think of one rememorable BMC model, whereas on the Leyland side I can think of a few - the Range Rover, the Rover SD1, the Honda-Leylands (such as the Triumph Acclaim), etc., even the Rover 75.

*Did BMC and Leyland complement each other? Absloutely not. However, Sir George Harriman had such a blind faith in Sir Alec that it was part of the reason why BMC lost money. I don't know about Leyland's financial situation pre-merger, but I do know that their Leyland CV range was pretty profitable, as well as the Rovers and Triumphs.

*Does BL have any possible media exposure? Yes, but increasingly it was negative. Basil Fawlty and Hyacinth Bucket both had BL products as their car of choice, and that pales to 007's Aston Martins (and future Ford Mondeo), or the Buick Riviera in Due South or Dominic Da Vinci's Jeep Cherokee. You could see what difference what a product associates with can make. Or how about the PR generated because of Red Robbo? Was it good or bad? The jury's out in my book.

In a way, you could say that just like how Renault destroyed AMC except for Jeep (in a Yank's eyes), in a way you could also say that Honda destroyed BL. Look at what was on sale on the Rover stable around the time of MGR's demise. The only good model was the 75/MG ZT, but that dates from BMW's era in 1998. All the others were outdated Hondas in British clothing. So, in a way, you could say that the stupid crew that authorized Honda making models for BL acted like Sir George Harriman and his bind faith in Sir Alec. Do GM want to turn out like BL? No. Think of what each has in terms of their stable.

*Entry-level. Renault-Nissan has Dacia, a single-model Romanian automaker (which will grow if the Steppe concept is authorised). But GM has Chevrolet, which sells rebadged Daewoos worldwide. In Latin America, Chevy is also a mainstream manufacturer, selling Opels (no matter if new or an old design). In addition, here, Chevy is also one of the biggest names in trucks (I see more Chevy light-duty and medium-duty vehicles then other vehicles. Go figure). Also, in Mexico, Pontiac is somewhat relegated to this job whilst Chevy sells Opels alongside US models, and all because Ford does the same thing in Mexico.

*Mainstream. Renault-Nissan has Nissan, and in S. Korea we have Samsung. But GM has "excitement"-oriented Pontiac, as well as Buick (which is a "premium" version of mainstream) and Saturn (which with its dealer experience and recent decisions to become a North American Opel have raised it to the upper-crust of mainstream); in Europe and also in most of the world Opel/Vauxhall is the main weapon. Nissan tries to cover all bases, but rather clumsily. The JDM President is only an upper-trim Cima (known here as the Infiniti Q45), and even then in Japan it's outgunned by the older JDM Toyota Century. The 350Z/Fairlady will never set some people's hearts on fire like what a 300SL Gullwing or a BMW 2002 or a Mustang or a Lambo or a Camaro or a Corvette or a GTO can do. The Nissan Altima and Primera don't look half as appealing as an Opel Vectra/Saturn AURA or a Buick LaCrosse/Allure (no matter the complaining). Go figure.

*Premium/Executive/Luxury. Renault-Nissan has Renault. Louis Schweitzer was even quoted once in Car magazine for wanting to give Renault a premium image. But Renault doesn't have the prestige of fellow Euro brands Mercedes-Benz, Jaguar, Aston Martin, BMW, Audi, Bugatti, and the like. And Renault has a bad rep in the US. GM has Cadillac (which, complain all you want, is a viable competitor), Saab (which is GM's attempt at using Swedishness to win people over, like what Volvo is to Ford), and the premium truck brands GMC and HUMMER. C'mon, does a Twingo scream premium? Not! Even Renault's Vel Satis is faring badly, while the triumvirate of GM's premium brands are soaring. Buick can also be counted here, somewhat, since Buick is at the upper end of the mainstream scale, and Buick banks on its quality. And I even hear that even VW's budget brand Skoda has better dealers in the UK than Renault.

Don't even forget Holden, which fufills all three in one - entry level (Barina, Viva), mainstream (Tigra, Astra, Vectra/Epica, Commodore, et. al.), and premium (Statesman/Caprice) in one - an Australian jack-of-all-trades in the GM stable.

So you tell me. Does R-N add anything to GM? No. All it will do it recreate the BL/MGR situation all over again.