Packard Forum Index » General

An interesting book is being released that says that General Motors was aggressively seeking a merger with the Ford Motor Company during the 2008 collapse.

"[In] July of 2008, the CEO of General Motors, Rick Wagoner, decided to approach Bill Ford and Alan Mulally, the Chairman and Chief Executive of Ford Motor Company, about a merger. The way I describe it in the book is, "this would have been the moment when the Big Three would really have become the Big One." [It was] completely out of character for GM to do this and turned down flat by Ford Motor Company,"

LINK

This is a shocking revelation. Especially since GM was once King of Detroit in car production.

How would a GM-Ford merger have played differently than a Packard-Studebaker merger?

I imagine Ford is the "Packard" in the equation, and GM playing the debt laden "Studebaker".

I think the difference NOW is that vast amounts of due diligence would be exercised. Swarms of accountants and lawyers would pore over every financial and legal angle.

In the end, I wonder if this wouldn't be considered an antitrust violation.

There are also big differences in economies of scale. PMCC and Studebaker were tiny compared to GM and Ford. Despite all the red ink, GM and Ford had FAR more resources than Packard and Studebaker had then. This makes it MUCH more possible, IMHO, that such a merger would actually work if not shot down by the gov't.

If I recall my automotive history correctly, back in the day Billy Durant wanted to buy Ford, but balked when Ford insisted on cash rather than stock.

GM and Ford combined still have about 45% of the North American market. I think it would not be reviewed kindly from an anti-trust angle.

Why would Ford want to do it? Let's invite cousin Jimmie to live with us - he eats a lot and doesn't work.

Oh, agreed! Ford would have nothing to gain from such a merger, except headaches...

sure wish Ford would have merged GM warranty. Ford warranty sucks. lowest in the indurstry 3/36...thats old school.


now its 5/60/100 or go home.

One big difference compared to P/S was that GM/Ford had complete model overlap with lots of potential synergies, although the cost savings would have taken years to realize and the negative hit on brand authenticity would have been significant. In 1954, Studebaker made mid-sized cars while Packard made full-sized cars. I always wondered about the grand plan to get them all on a common body shell. Maybe Rambler/Studebaker and Packard/Hudson sharing would have made more sense. In that scenario Packard would have needed to merge with AMC first because without AMC, Studebabker was a boat anchor to Packard. Wasn't Nance's need to be CEO the stumbling block?

The fact that GM even contemplated a merger speaks to the dire straights they knew they were in. All this happened a few months before Wall Street collapsed and the government hinted to Detroit that they might offer a helping hand. I have to wonder if GM's going first to Ford was an anticipated prerequisite for that money, to show they tried everything to save themselves. What an interesting situation though... the CEO with hat in hand went to see the CEO with hatchet in hand. There wasn't and isn't a (young) Henry Ford or Steve Jobs in either camp, just as there wasn't at Packard or Studebaker. Without that person how can any company, in the long run, survive?

Chevy and Ford together
...... I'm gouging my eyes out now!