Ford, GM Alliance: Fallacious Or Not?

Automotive News has reported on Monday that two auto giants are discussing a merger or alliance. The two giants named in the report were Ford Motor Company and General Motors Corporation. Said report has cited several sources connected with the supposed discussion about merger or alliance. Nonetheless, it said nothing about whether said discussion will further come into existence. On the other hand, both automakers made a brief comment on the matter.

Brian Akre, GM spokesman said "As we've often said, GM officials routinely discuss issues of mutual interest with other automakers. As a policy, we do not confirm or comment publicly on those private discussions, which in many cases never lead anywhere." Tom Hoyt, Ford spokesman, dismissed the query by saying that the automaker does not comment on speculation. Moreover, Ford and GM refused to confirm the report of such merger or alliance.

Both Ford and GM are coping up with their shrinking market and dismal sales from the past reports. This has paved way for some speculations that the two shall restructure their operations and might entertain merger or alliance with other vehicle manufacturing company. Nevertheless, Automotive News noted that there is a slim chance that anything will come of the situation.

Recently, Ford has announced its slashing of $5 billion in costs. It also added that one-third of its work force in North America might also be found unproductive. Ford has also suspended dividends and promised to do a revamp in its lineups which are seen as weak by auto analysts. Nonetheless, the automaker is making remarkable efforts to boost the marketability of its new Explorer. All-new 2007 Ford Explorer body parts are meticulously manufactured to create a more powerful and stylish SUV.

General Motor Company, on one hand, is also in the midst of restructuring its lineup to recover from the $10.6 billion loss in the previous year. GM is also planning to close 12 plants. Further, it has also accepted early retirements and buyout offers. Rick Wagoner, CEO of GM, is also on the hot seat to show improvements in sales.