19 September 2006

Could the "BIG TWO" Become the "BIG ONE"?

Ford and GM...MERGING? Is it possible? Many think it's on the horizon, considering the battering the U.S. carmakers have been taking for the past several decades.

This same merger ALMOST happened way back in 1908, and although the merger THEN was between Ford, Olds, Buick, and Maxwell, the bosses all AGREED to it, yet the deal never came about. Seems there was a "clash of personalities". A year later, William Durant (then head of Buick) sealed a "new" merger, and the result was GENERAL MOTORS. Ford remained it's OWN company.

So...can "lightning" strike twice (in the relatively same place)?

Consider the fact that all THREE of the major U.S carmakers have a LOT of foreign influence already entrenched in their companies. They all share technology with Japanese carmakers, and now the Koreans as well. A majority of parts come from either Mexico or Canada, and still others from China (as does most everything we use these days).

A merger between GM and FORD would give them a 40 percent market share...not too bad for an AMERICAN outfit, but still lower than I would have imagined. They would most likely do away with brands not selling well, such as MERCURY, BUICK, and PONTIAC, concentrating on FEWER brands and better selling models, much like their Asian counterparts.

SO...is there a "downside" to this, should it happen?

Hell, YES!

The UAW will have a very heavy hand in all of this, and would most likely cause a MAJOR stink over closed plants, lost jobs, further cutbacks, and the like. That would CRIPPLE the industry, period!

But it's not like these automakers DIDN'T see "it" coming (they just refused to acknowledge that "it" was ever there). And what is..."IT" anyway?

"IT" is the advent of the foreign market, which began to hit it's stride in the late 60s, when the VW beetle was growing in popularity. Then came the Japanese cars, which at first were really junk, but the Asians LEARNED from that, built much better cars, and are now today winning all the kudos of everyone else in the industry. Talk about a "quick study", eh? The Europeans mainly catered to a richer segment of the population, overall, so they really didn't figure into the equation. Also, other car companies bought out most of the English and French firms. One exception was Daimler Benz...who bought out CHRYSLER...turn about is fair play I suppose.

WIll we, the consumer make out with a merger between GM and Ford? Maybe, but remember, it's NEVER about "us"....it's about ...THE BOTTOM LINE.

Yet if that bottom line entails better craftsmanship and styling ( not a cookie-cutter lookalike vehicle), more efficient technologies, and safer vehicles...well, that might just be worth it.

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