- Location
- Never Far From Nowhere
As many of you are well aware, Chrysler is as good as dead. Cerberus has been looking to divest themselves of the failing company for at least a year now. The proposed merger with GM is toast now that the Fed's have said they won't back GM and GM doesn't have the capital to go it alone (seeing as they are heading for Chapter 11 anyway). So what does this mean for the most important part of Chrysler, Jeep?
I see Chrysler entering Chapter 7 (liquidation) as early as next week but no later than mid-December. Once they enter C7 every part of the company will be up for grabs. Jeep is by far their most valuable brand, with the Wrangler being Jeeps most important product. Several companies have expressed interest in purchasing Jeep from Chrysler in the past year, Tata, Mahindra & Mahindra and Renault/Nissan.
My personal preference is that Mahindra & Mahindra (M&M) purchase Jeep. My reason being that M&M only builds SUV's and used to be the manufacturer of Jeeps in India. Additionally, with India's rising status and economic power, Jeep might be well suited by being owned by an Indian company. And finally, with Tata's purchase of Land Rover, a M&M owned Jeep might lead to some brand rivalry which could produce better products from each.
That being said, M&M has no market presence in the US. This is a problem with the coming higher CAFE standards. Jeep doesn't have the MPG's to stand on its own in the US market. So tying it to M&M might be a bad deal. Thus Renault/Nissan (R/N) might be the better option. Nissan already has a strong market presence in the US, and reasonable fuel ratings for its vehicles. If R/N were to purchase Jeep, its fuel ratings would be rolled in with Nissan. And if Renault decided to reenter the US market, then all the better. Additionally, R/N has manufacturing and dealer capacity on three continents already, by adding Jeep to that mix it would bolster its capacity even more.
An R/N owned Jeep probably makes the most sense, but we will have to see how the cards fall. Regardless, the death of Chrysler means big changes in the US auto market. My only hope is that Jeep makes it out relatively unscathed.
What does everyone else think?
I see Chrysler entering Chapter 7 (liquidation) as early as next week but no later than mid-December. Once they enter C7 every part of the company will be up for grabs. Jeep is by far their most valuable brand, with the Wrangler being Jeeps most important product. Several companies have expressed interest in purchasing Jeep from Chrysler in the past year, Tata, Mahindra & Mahindra and Renault/Nissan.
My personal preference is that Mahindra & Mahindra (M&M) purchase Jeep. My reason being that M&M only builds SUV's and used to be the manufacturer of Jeeps in India. Additionally, with India's rising status and economic power, Jeep might be well suited by being owned by an Indian company. And finally, with Tata's purchase of Land Rover, a M&M owned Jeep might lead to some brand rivalry which could produce better products from each.
That being said, M&M has no market presence in the US. This is a problem with the coming higher CAFE standards. Jeep doesn't have the MPG's to stand on its own in the US market. So tying it to M&M might be a bad deal. Thus Renault/Nissan (R/N) might be the better option. Nissan already has a strong market presence in the US, and reasonable fuel ratings for its vehicles. If R/N were to purchase Jeep, its fuel ratings would be rolled in with Nissan. And if Renault decided to reenter the US market, then all the better. Additionally, R/N has manufacturing and dealer capacity on three continents already, by adding Jeep to that mix it would bolster its capacity even more.
An R/N owned Jeep probably makes the most sense, but we will have to see how the cards fall. Regardless, the death of Chrysler means big changes in the US auto market. My only hope is that Jeep makes it out relatively unscathed.
What does everyone else think?
