Items Tagged With DCX

Cerberus Buys Chrysler
Written By: Taeho Lim
2007-05-17 19:01:48
A few days ago, I reported that Canadian auto parts maker Magna International took a definitive step toward buying Chrysler by selling $1.54 billion worth of voting shares to Russian Machines. Well, it turns out that New York-based Cerberus Capital Management emerged from the woodwork and won the bidding war with a $7.4 billion commitment to Daimler and Chrysler. Cerberus will pay $6.05 billion to privatize Chrysler and dole out another $1.35 billion to Daimler (DCX - 86.68). The deal easily eclipses the $4.7 billion offered by Magna (MGA - 80.89) and marks the first time a private equity firm has ever taken over a member of the Big 3.

Could Rising Gas Prices Lead to the Rise of the Microcar?
Written By: Taeho Lim
2007-05-01 06:39:11
Imagine if your favorite burger joint increased the price of your favorite half pound ground sirloin each day by a few cents. You'd probably shrug it off and keep going because you can't eat anything else without feeling unfulfilled. But after awhile, the emptiness in your wallet cancels out the satisfaction you feel in your stomach. The same goes for the automotive industry. Gas prices have risen 33% over the last 11 weeks to $2.87 per gallon as of late April 2007, prompting concerns that prices could hit $4 within the next few months. In response, GM (GM) and DaimlerChrysler (DCX) plan to introduce smaller models known as microcars as a more fuel-efficient alternative for drivers seeking shelter from the rising petroleum tide.

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Ford and Navistar Square Off
Written By: Taeho Lim
2007-05-10 15:27:36

Just as Ford (F) started to make some headway in its extensive rebuilding program, the Dearborn automaker incurred a noteworthy legal headache from an important engine supplier. Illinois-based holding company Navistar (NAVZ.PK) filed a $2 billion suit against Ford alleging breach of contract by the automaker for trying to develop its own diesel engine despite an agreement to buy Navistar's Power Stroke powertrain through 2012. Navistar's claim comes in response to Ford's January lawsuit contending that Navistar hadn't paid warranty costs.

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From Russia with Love
Written By: Taeho Lim
2007-05-14 17:49:50

Photo: pingnews, Creative Commons, Flickr

With Chrysler Group losing $1.5 billion in 2006, DaimlerChrysler (DCX - 82.00) spent the last several months shopping its dangling domestic appendage to anyone willing to take the flagging subsidiary off its hands. While several firms have answered the bell, Canadian auto parts maker Magna International (MGA - 83.92) stepped to the forefront after selling off $1.54 billion worth of its voting shares to Oleg Deripaska and his holding company Russian Machines. Analysts tell us that the transaction opens the door for Magna's expansion into the burgeoning Russian auto market and sets the stage for a $4.7 billion offer to buy 50% of Chrysler. If the deal goes through, Daimler will retain 10% of Chrysler while Magna and Canadian investment firm Onyx will pick up the rest.

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The Automotive Big Three: What Really Went Wrong?
Written By: Mark Bershatsky
2007-04-14 22:26:19
It is no mystery that America's Big 3 automakers are in critical condition right now, they have clearly entered uncharted waters. Foreign automakers, particularly from Japan, have weighed down on the Big 3's former stronghold on the global auto industry and are now posing serious threats to become the new leaders. Since 2005, net losses have totaled in the tens of billions for Ford (F), GM (GM), and DaimlerChrysler (DCX), while Toyota (TM) has crept up to being the world's #2 automaker and should soon overtake GM as the largest. The city of Detroit, once a proud blue collar city built on sweat and steel, has also felt the ill effects of the restructuring of its three largest employers.

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