Like a rhythmic wave, Fiat-Chrysler Autos CEO, Sergio Marchionne, has once again stirred up chatter over an FCA-General Motors merger.
The latest comments come from CNBC, as he rebutted claims made in a new Standard & Poor report over the possibility of an FCA-GM merger.
The report utterly dismissed the idea of a merger happening, adding there were “significant integration and execution risks.”
Marchionne said he has not read the latest report, but had strong words on the dismissal of his continued merger proposals.
“With all due respect to Standard & Poor’s, it doesn’t understand anything,” he said at the sidelines of an event in Washington D.C.
Through his continued comments, GM CEO, Mary Barra, has made it crystal clear her company has zero interest in an FCA merger, noting GM’s scale is more than enough to go it alone. Industry analysts also continue to call the merger a bad deal in every aspect.
Comments
Someone please put a ductape on Sergio so he can shut up already
Silence is golden but duct tape is silver.
Sergio must be some kind of nut. GM would gain nothing from merging while FCA would gain a lot.
One has to wonder would Sergio Machionne want to merge with General Motors if the company didn’t have over $25Billion in cash reserves; but any merger between GM and FCA would create an over capacity in Europe which means needing to kill off most of Fiat, then the new company would need to kill off most of Chrysler Dodge before firing FCA’s board of directors including Sergio Machionne (although if FCA spins off Ferrari before then there’s absolutely nothing within FCA worth having).
They’re only making 10% of Ferrari public, FCA will retain 80%.
I guess Mergio feels that everybody is wrong and he is the only one right. Yes he has valid points of the industry needing consolidated, but not with GM. He has to get it through his thick Neapolitan skull that it will never happen with GM in terms of his merger. Even Carlos Ghoson who masterminded Nissan-Renault deal says this is a bad idea. Along with all of GM management, most investors, most industry analysts and now Standard Poor. I mean what will it take for him to get a hint.
Now I know what a scrotum would sound like if it could speak.
As I said before, Marchionne should look in China for a partner to merge FCA with.
As much as I like the ‘Mergio’ nickname, and the ‘scrotum talking’ line – can I borrow those? – a couple of things get lost in the discussion:
1). The Agnelli holding company that’s sitting on a ton of cash and wants to see their FCA investment pay off. Mergio is vice-chairman of the holding company. And …
2). S&P. After giving their blessings to the companies that lead, in no small part, to the financial mess that teed-up 2009, and later downgraded the U.S. Credit rating because of a $2 Trillion math error (on their part), I’d take their input with a grain of salt. (Just Google S&P financial mishaps). They’re not the über authority they once seemed to be.
Not saying this is merger-tron is gonna happen. But I wouldn’t underestimate the Italians, or overestimate S&P.
Even Agnelli money is not enough to pull it off. According to the Analyst it would take several investment groups to pull it off. If they did get help it could be done but as of now he is not getting the help needed to pull it off or he would have already done it. That could always change but as of now it is not happening for him.
As of now these folks if they were to invest they would rather put their money in with GM than with FCA merging. The many funds have all up rated GM of late and it should only improve post ignition issues. That was the real cloud as no one knew the cost and now they pretty much know the cost and this has returned them back to being a good risk for making higher profits from here forward.
Right now Fiat is so over capacity in Europe and under volume in most of their divisions accept for Jeep and the Trucks that they have a lot of problems right now. The Ferrari money is not going to go all that far to fix much. They will struggle to bring new product to the market and will lack much in the Hybrid and EV area when states in the future will require a specific percentage of the cars sold to be of this nature.
Delayed programs and under performing product is really hurting and not much of a way out here. VW had wanted to buy in but Sergio would have been out. He did not want that deal but with the new trouble for VW they are not in a place to buy them out now.
The longer this goes on the stronger place GM will be in and the weaker FCA will be. If he was going to do this he should have done it when he first spoke out as his position is only going to get weaker.
Jeep can only save his bacon for so long. He put all his eggs in the Alfa basket and that will be his undoing. They will never make the 400,000 unit goal he stated they needed.
Does anyone know a good shoe cobbler and/or suit tailor in Sicily that can help Mr. Marchionne get to the bottom of the debate?