In November of last year (see my 2008 Predictions), I wrote the following:
Long Shot Prediction: Either Chrysler will be broken up and sold off (and thus cease to exist) to raise capital for Cerberus or Ford will declare bankruptcy.
Believe me, I take no delight in taking credit for yet another accurate prediction. It’s this very kind of thing I was warning of when I wrote Five Short Blasts. But it seems that the demise of Chrysler is now only days away. The link above is an article reporting on “merger” talks Chrysler is having with Renault and GM. What’s not reported in this article are details that are covered by the local media here in the Detroit area:
- GM is pushing to close this deal by the end of the month. So too is JP Morgan Chase, one of GM’s financial backers.
- This really won’t be a merger. Cerberus wants to dump Chrysler at any cost. GM wants the Jeep brand and will maybe keep a couple of other models, like their mini-vans. Other than that, GM plans to completely shut down Chrysler and eliminate all those jobs. Basically, they see it as an opportunity to eliminate a competitor and enhance their own sales in the process.
So we’re looking at the loss of at least 100,000 jobs and the elimination of what was once one of the biggest, proudest, premier companies in our nation’s history. It’s the end of the line for an iconic brand and a long line of historic vehicles that were often on the forefront of automotive innovation. The day that the merger happens will be a sad, sad day for American manufacturing and the American economy – one more big step in America’s downward spiral.
I was hoping this day would never come, that they could hold off just long enough for our nation to wake up from its globalization delusion. But it appears that, if that day ever comes, it will be too late for Chrysler and, unfortunately, it may come too late for Ford and GM as well. In the words of Don McLean, “bye, bye Miss American Pie.”