Interesting times, indeed

Chrysler is hoping to cement a deal with Fiat to avoid complete liquidation-and it appears that the US Government is prepared to allow the deal to happen. Fiat gets immediate entrance into the US auto market and Chrysler gets new small cars-one of the many product weaknesses at Chrysler.

Fiat is one of the two primary partners for Opel in Europe. It'll be rather ironic if Fiat, a company not known for its reliable cars (Fiat proper, not Ferrari/Maserati), winds up with both Chrysler and Opel. It's good news for GM-the other company struggling to tread water.

Fiat is in a great position here...they have the opportunity of picking up the pieces of Chrysler with US Government money to back the cost structure up for a bit, existing production lines and a (too large) dealer network. If they also pick up Opel, they'll gain a stronger market share of European car markets and additional technology and production. It's almost a win-win for Fiat.

Chrysler announced the closure of 789 dealerships across the country in an effort to cut costs and drive vehicle prices higher. On one hand, it was needed. Living in DuPage County in Illinois, there are way too many car dealerships. On one street, a person can drive less than ten miles and see the same car dealerships at least twice (if not three times, as is the case with Chrysler/Dodge dealerships). The number of dealerships should have contracted with the market share when it started to shrink ten years ago but it didn't...and that coupled with some of the worst new cars on the road, Chrysler started to crumble.

GM is headed for a structured bankruptcy in the next week. Bondholders rejected the latest deal...and once again, the US Government is going to flush more money down the GM toilet. I think it's ridiculous that companies get this big and fail-forcing those of us who've avoided these toxic companies for this very reason to bail them out through taxes. And it'll happen again.

The auto unions should die with these bankruptcies. There are many arguments for and against unions-but their main purpose evolved out of necessity over a decade ago. Toyota, Honda, Nissan, Subaru, BMW-they've all avoided unions in the US and they're not crying for help. Sure, Ford is married to the same union as GM/Chrysler but they've been able to leverage the situation to their advantage.

The topic of labor unions is a sensitive one. It's like discussing politics, abortion and religion all at the same time. It's typically one of the four things I don't discuss with people I might need to interact with again in the future. People get so fucking uptight about it...like I'm taking food out of their personal mouth during a famine. I'm sure I'll post something about it in the coming days.

It's been a drought here on this blog for a while...I can't just open the floodgates and drown everyone.