Is a General Motors/Ford Merger in the Works?
Is a General Motors/Ford Merger in the Works?
Wall Street thinks that it makes sense for GM and the Blue Oval to join forces, blasphemous as it may seem.
Since the birth of the automobile, Ford and General Motors have remained bitter enemies. Well, for the most part, anyway. While we brand loyalists continue to poke fun at the other side, the truth is, GM and Ford have actually worked together on some things in recent years. Including, most recently, development of a 10-speed automatic transmission. But to think that the two automotive giants could actually merge into one company? Total blasphemy, right?
Well, maybe not. At least over on Wall Street, pundits believe that a General Motors and Ford merger makes a lot of sense. This rather unthinkable scenario emerged recently over at MSN, followed by some lengthy and in-depth reasoning. Truth is, though we like to paint a rosy picture, both automakers have struggled financially in recent years. And on the other side of Detroit, Fiat Chrysler is looking to join forces with yet another manufacturer — this time Renault.
Car sales are on the decline here in the U.S. as well as China, the two largest markets in the world. Only GM has a decent foothold in China, but faces a slew of competition there. Ford is behind the game in the emerging market of all-electric and hybrid vehicles, while GM is well-positioned there. Thus, a merger makes a ton of sense, at least in the financial world. The only real problem such a deal might face come from U.S. regulators, who might have a problem with one company owning 30% of the market.
Still, it’s important to remember that this kind of speculation is just that – wild speculation. There are no indications that General Motors and Ford are going to join forces. You won’t be buying a C8 Corvette with a Blue Oval badge on the back. But if nothing else, the fact that it’s even possible is just further evidence that the world of automotive manufacturing ain’t what it used to be.
