If Chinese company buys Jeep, will Wrangler be affected?

[Vegas_Sirk]

I have no opinion one way or another about Chinese owning it over the French. What I do have an opinion on is that that FCA would be idiots in selling Jeep, because without Jeep and Ram the FCA portfolio is worthless and from a pure business stand point would be shooting their self in the foot. Both Dodge and Chrysler are not strong brands anymore and without Jeep & Rams support would most likely go under.

My point about Trump was simply that I think he would have a shit fit over it, and make an example out of the company even if it meant more investment dollars here as for him its more about appearance of "American Made"

Lastly here is a good read from the business side of why FCA dosen't need to sell: https://seekingalpha.com/article/41...ion-fiat-chrysler-thrives-staying-independent

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[jkrod]

Trump can't do shit about a private sector company. Yep makes no sense but Marchione is leaving in a year or two. No idea what his personal agenda and compensation package is??? that is the missing piece?? and yep Jeep and Ram is only thing in the company worth anything at all for future as they already offed ferrari. whoever or whatever just hope they're smart enough to not fuk up the platform too much

 

[Vegas_Sirk]

Trump can't do shit about a private sector company. Yep makes no sense but Marchione is leaving in a year or two. No idea what his personal agenda and compensation package is??? that is the missing piece?? and yep Jeep and Ram is only thing in the company worth anything at all for future as they already offed ferrari. whoever or whatever just hope they're smart enough to not fuk up the platform too much

You're right about Marchione. Thats the big wild card. He may be on his way out and the sale could result in a big pay day for him prior to retiring, and he could give two s less about long term viability.

However that article on Seeking Alpha is correct in that the transformation of the FCA over the last five years has finally got it in a good position and that they might be better off just seeking investment and not selling anything.

 

[Armycop]

I think cleaning house and new ownership at Jeep is needed. The Wrangler was doing well because it wasn't a rebadged Fiat platform. The rest of the vehicles in the Jeep lineup are really suffering with quality issues due to FCA equipment. All the recent FCA products to include the overpriced Alfa Romeo products are plagued with problems.

 

[jkrod]

I think cleaning house and new ownership at Jeep is needed. The Wrangler was doing well because it wasn't a rebadged Fiat platform. The rest of the vehicles in the Jeep lineup are really suffering with quality issues due to FCA equipment. All the recent FCA products to include the overpriced Alfa Romeo products are plagued with problems.

"was" doing well?!??!??! wranglers are probably the most solid and consistent vehicles in auto industry sales and profits besides ford f150s and chevy silverados..............the core of jeep, and FCA biz................yeah seem to be lots of fiat issues.............which makes it hard to understand why they want to sell?? theres lots of missing pieces to the puzzle

but if you look at one of my earlier posts it is baffling to me why a US auto company wouldn't want to buy Jeep??? don't do anything except feed it what it needs to grow...........doesnt compete with anything else in the market, wranglers anyway...........really weird!!

 

[Vegas_Sirk]

but if you look at one of my earlier posts it is baffling to me why a US auto company wouldn't want to buy Jeep??? don't do anything except feed it what it needs to grow...........doesnt compete with anything else in the market, wranglers anyway...........really weird!!

I agree but what US manufacturer would it be a good fit for? Ford and GMC both have competing lines. I think if they sold both RAM & Jeep in a package that it would be a good buy for VAG or BMW.

 

[jkrod]

I agree but what US manufacturer would it be a good fit for? Ford and GMC both have competing lines. I think if they sold both RAM & Jeep in a package that it would be a good buy for VAG or BMW.

no one has anything that "really" competes with a wrangler, and even the new "wrangler" truck............nothing on the market any way shape or form...........baffling to me and also why no one has ever tried to make anything that would

 

[AVENTUS]

Wrangler sales and quality perception will go in the toilet. Less sales to USA public. Whether or not that's true won't matter, they will take a hit on perceived quality.

Will FCA vehicles sell better in china if that happens ? I would assume so.

A GM merger would be better sales wise, at least domestically.

 

[AVENTUS]

no one has anything that "really" competes with a wrangler, and even the new "wrangler" truck............nothing on the market any way shape or form...........baffling to me and also why no one has ever tried to make anything that would

I have a feeling GM is either going to bring back the hummer line with a competitor to the JLU, or launch a GMC competitor.

 

[The Great Grape Ape]

no one has anything that "really" competes with a wrangler, and even the new "wrangler" truck...

They are not selling Wrangler, they would be selling JEEP and both Ford and GM have existing products across the spectrum except for Wrangler, so they likely wouldn't add sales to the combined units but lose sales to people who thought the one brand was tainted by the other.
Also splitting efforts hasn't proven effective in the past as seen by GMs various nameplates in the past, and all of the Big3 discontinuing nameplates, etter for someone not already in the market to buy access for their additonal products.

A GM merger would be better sales wise, at least domestically.

Sales numbers would increase by addition, but would the units grow faster or slower than they would've separately.
Buying an existing competitor in you own market works best if you are consolidating in order to increase price or reduce costs. As both are fairly inflexible due to externalities, then it's an inefficient way to simoly increase numbers, especially if those numbers might contract if the acquired comoany is just seen as an extension of the buyer's brand/image.

Better for GM to acquire/ merge with a comoany that gives them access to markets they don't currently have access to.

 

[jkrod]

They are not selling Wrangler, they would be selling JEEP and both Ford and GM have existing products across the spectrum except for Wrangler, so they likely wouldn't add sales to the combined units but lose sales to people who thought the one brand was tainted by the other.
Also splitting efforts hasn't proven effective in the past as seen by GMs various nameplates in the past, and all of the Big3 discontinuing nameplates, etter for someone not already in the market to buy access for their additonal products.



Sales numbers would increase by addition, but would the units grow faster or slower than they would've separately.
Buying an existing competitor in you own market works best if you are consolidating in order to increase price or reduce costs. As both are fairly inflexible due to externalities, then it's an inefficient way to simoly increase numbers, especially if those numbers might contract if the acquired comoany is just seen as an extension of the buyer's brand/image.

Better for GM to acquire/ merge with a comoany that gives them access to markets they don't currently have access to.

Im not going to debate speculation but you're not seeing the whole picture. Ive been on both sides of M&A in mid to large cap companies and JEEP is prime pickings

 

[The Great Grape Ape]

Im not going to debate speculation but you're not seeing the whole picture. Ive been on both sides of M&A in mid to large cap companies and JEEP is prime pickings

I am seeing the whole picture, which is why I say Jeep and not just Wrangler as you did.

Consolidation may work in other industries, but it hasn't proven effective in recent times in the auto industry for large players, which is why after years of doing so the major players divested of much of their acquisitions. Instead expansion into new markets (either geographically or new classes/categories) has proven to be the most effective method of growth and profits.

There is too much overlap in GM & Jeep to make that as beneficial for them as it is for a party who has no existing vehicles in Jeep's primary markets that grants them established access to those markets and large potential for growth for their vehicles not already in those markets. From an M&A perspective that should be obvious to you which one has greater potential for 'synergies'.

 

[jkrod]

I am seeing the whole picture, which is why I say Jeep and not just Wrangler as you did.

Consolidation may work in other industries, but it hasn't proven effective in recent times in the auto industry for large players, which is why after years of doing so the major players divested of much of their acquisitions. Instead expansion into new markets (either geographically or new classes/categories) has proven to be the most effective method of growth and profits.

There is too much overlap in GM & Jeep to make that as beneficial for them as it is for a party who has no existing vehicles in Jeep's primary markets that grants them established access to those markets and large potential for growth for their vehicles not already in those markets. From an M&A perspective that should be obvious to you which one has greater potential for 'synergies'.

you really don't have a true grasp of marketing.........jeep and wrangler are interchangeable, the other models sell because of wrangler, the GC and new renegade are prime examples, just watch the commercials..............if done right it is not cannabalism.............GM has nothing that translates to a jeep........any of their suv's are not perceived to be "off road"..........all the jeep models are..........its not like a "malibu" that just changed the badge to buick, pontiac, or saturn............I get what you're saying and you're right just to a certain point..............IMO Ford would benefit greatly from buying jeep or a really good one wool be Honda, which Im sure wouldnt ever happen , but that would be incredible

 

[The Great Grape Ape]

I understand marketing, you obviously don't understand economics.

Jeep as a Brand would be great to acquire if it didn't come with all the production facilities, workers and everything else, and if you weren't paying a large premium for it. The cost of that badge is now much higher than when Fiat acquired it, the only way it works is if FCA were to give it away which is even less likely than them (GM/Ford) acquiring it in the first place.

Also, most of Jeep's vehicles already leverage the brand in the same space as GM and Ford, so while Jeep may still thrive it doesn't elevate their new stablemates' other brands by association, you don't just slap a Jeep logo on a Traverse or Escape, and make it more marketable. Again if fragmentation was good, then GM and Ford wouldn't have dumped all their Subsidiaries that did and have done better as independants.

The overlap and duplication in the existing market and production is large, and that is not good for any kind of ROI on a merger, it's far better for a foreign company without existing marketshare or facilities to buy Jeep to gain access to the market/production and have far great opportunities at expansion.

Also, simply put, had it made sense for Ford or GM to buy it, then they already would've done so, as Sergio went to them first a long time ago.

 

[Vegas_Sirk]

I agree with Ape on this. As GM's only hole in the market place is a Wrangler competitor. They already have a Scrambler competitor in the Canyon/ Colorado, and Cherokee, Grand Cherokee competitors as well. Thats why I said it would make better sense for BMW or VAG (VW Audi Group) to buy Jeep and Ram as a package since they are not currently in the truck market and are are in luxury up scale markets. In fact BMW would be ideal for it even more so then VAG as both JEEP and RAM have good brand equity like BMW that they could play off. Also BMWs platforms could underpin the Grand Cherokee and Cherokee one day by sharing it with the X line up (X1, X3, X5)

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