Only hours after Daimler’s U-turn on Chrysler’s future came reports that it may already be chatting with General Motors, says Lex. Investors would probably be unwise to read too much into speculation of full-scale merger talks. Detroit’s Big Three have the shared problem of shrinking their capacity to keep up with falling volumes — that would be no easier after a deal. Arguably, Chrysler is in slightly better shape than its Detroit rivals. That could make it an attractive partner for a more far-reaching alliance. But among the main carmakers to have tried that, only Nissan and Renault can claim some success. Once their recent issues are resolved, Chrysler might make a neat addition to the pair. But while the chatter about link-ups is bound to continue, it will not be surprising if none materialise any time soon.
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