Sources say GM and Daimler Chrysler are in talks
16 February 2007

General Motors is rumoured to be in negotiations to buy Chrysler.

Sources in both Germany and the US say that high-level talks are taking place between bigwigs from both Chrysler's parent company DaimlerChrysler and GM.

Chrysler has had a seriously tough week – on Wednesday it announced that it was cutting 13,000 jobs from its 83,000-strong North American workforce by 2009.

Acquiring Chrysler would be an unexpected move for GM, which itself is struggling.

DaimlerChrysler boss Dieter Zetsche said earlier this week that he was considering all options for stuggling Chrysler, including selling it.

However, recent reports suggest that DaimlerChrysler may in fact be attempting to turn around its struggling American arm. It is said to have employed analyst JP Morgan to help.

Separating Daimler and Chrysler would not be cheap; as with GM and Ford, Chrysler is saddled with billions of dollars of pensions and healthcare responsibilities for workers. Any potential buyer would surely want these paid.

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