General Motors top executive said Thursday he does not expect GM to become a private company, but said the dynamics of the auto industry are changing rapidly and would not dismiss the idea completely.
“I dont think you can rule out anything now because the amounts of money being tossed around are so big,” GM's chief executive Rick Wagoner told reporters after a speech in Detroit.
“I dont see a mad rush to private ownership in the auto sector. However, I do expect there to be further consolidation in the auto business. But I dont know who and I dont know when,” he said.
“Certainly the recent efforts havent been all that successful,” said Wagoner, who rejected a proposal last year to explore a potential merger or alliance with French-Japanese car-maker Nissan/Renault.
Wagoner also said GM may end up working more closely with Chrysler on the financing side of the auto business in the future.
Cerberus, the New York-based private equity firm, is buying an 80.1 percent stake in Chrysler and already owns 51 percent of GMAC, the finance company that up until earlier this year was wholly owned by GM.
“We have a relationship by virtue of our 51/49 percent ownership of GMAC. Our relationship has been positive,” Wagoner said.
“I would expect them (Cerberus) to work very well with Chrysler. I would expect them to be a good partner for Chrysler,” the GM chief said, adding “certainly there are potential synergies and a lot of different ways to think about it.”
And he hinted that GM could forge closer ties with the firms in the future.
“Nothing specific has been presented to us and we havent developed any ideas but Im sure that will happen over time. But there are opportunities there, we just havent gotten into the details yet,” he said.
Wagoner also said he expected to collaborate with Chrysler on promoting the use of biofuels and the development of new technology such as hybrids that could help reduce the U.S. dependence on imported oil.
“Its astounding to see the way the industry is growing” in emerging markets such as China, India, South America and Russia, Wagoner stressed.
Wagoner has said one of his key goals is to expand GMs reach in India. “Were very committed to getting into these developing markets,” he said.
