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Marchionne ready to get tough with GM over merger

FCA CEO Sergio Marchionne absolutely refuses to let go of his dream of a merger with General Motors. With official discussions not happening, Marchionne now hints that a hostile takeover attempt of The General could be under consideration as a future strategy. In a massive interview with Automotive News, the boss explains why a tie-up with GM might be such a windfall for both automakers. By Marchionne's numbers, a merged GM-FCA would produce $30 billion a year in global earnings and 17 million vehicles annually. He claims these huge figures are based on analyzing plants around the world to find growth opportunities. So far, GM is refusing to sit down and look at the numbers, let alone even begin to negotiate. For now, Marchionne just wants to talk, but he's not against aggressive action, if necessary. He uses a bizarre metaphor in the interview to explain his feelings. "There are varying degrees of hugs. I can hug you nicely, I can hug you tightly, I can hug you like a bear, I can really hug you. Everything starts with physical contact," he said to Automotive News. "An attack on GM, properly structured, properly financed, it cannot be refused," he said in the interview. Marchionne is looking for partners, too. The UAW's significant stake in GM could be a strong ally, and he's reportedly recruiting activist investors for more help. Selling Magneti Marelli and spinning off Ferrari would put even more cash in the war chest. Both sides also have banks at their aid. While Marchionne received positive replies from some of his "Plan B" partners, he apparently lost interest in working with them. "Are they the people I wanted to get the response from? The answer is probably not. There are people who are interested in doing deals," he said in the interview. News Source: Automotive News - sub. req.Image Credit: Paul Sancya / AP Photo Earnings/Financials Chrysler Fiat GM Sergio Marchionne FCA merger

Chrysler dealers terminated in bankruptcy still stuck in court

Part of the deal for the federal bailouts of Chrysler and General Motors was that both organizations were required to trim their vast array of dealerships. This move did not sit well with the people that would be losing out on franchises, though, and in Chrysler's case, 148 of the shuttered dealers have fought for money they feel they are entitled to.
These dealers believe that they should be compensated by the federal government, as Chrysler wouldn't have trimmed its sales centers had it not been ordered to by Uncle Sam. Now, thanks to the ruling of three judges on the US Court of Appeals for the Federal Circuit, the dealers will get a chance to argue their point.
According to Automotive News, the dealers argue that the mandatory shuttering of dealers was unconstitutional, because the federal government was taking property without compensation. If the dealers are victorious, not only would the government be out millions of dollars, but a precedent could be set that would allow similarly closed GM dealerships to cash in.

Preserving automotive history costs big bucks

$1.8 million is spent each year to maintain GM's fleet of 600 production and concept cars.
When at least two of the Detroit Three were on the verge of death a few years back, one of the tough questions that was asked of Ford, General Motors and Chrysler execs - outside of why execs were still taking private planes to meetings - was why each company maintained huge archives of old production and concept vehicles. GM, for example, had an 1,100-vehicle collection when talk of a federal bailout began.