Word: chrysler
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Dates: during 1980-1989
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...Chrysler-Renault agreement was the highlight of a surprisingly wild week of merger activity, which came at a time when many Wall Streeters had been expecting a slowdown in takeover bids because of tax reform and the insider- trading scandal (see following story). Chrysler, which began considering the AMC purchase last summer, estimates that it missed out on $100 million worth of potential tax write-offs on the deal on Jan. 1 because the advantages were eliminated by the reform legislation. Nonetheless, Iacocca was determined to buy AMC. Said he: "((The merger will)) strengthen both of us in what...
...proposed acquisition will not shake up the rankings in the $230 billion- a-year U.S. auto industry. For increasingly robust Chrysler (1986 profits of $1.4 billion on sales of $22.6 billion), the deal would merely add AMC's piddling .7% car market share to the bigger firm's 10.3%. That would still leave the merged company far behind No. 2 Ford (18%) and GM (39.6%). But the purchase will help Chrysler solve a pressing problem: its factories do not have the capacity to produce enough cars to meet demand. Chrysler had started easing that production crunch by contracting...
More important, perhaps, the purchase of AMC's Jeep line helps Chrysler, which has led the way with such innovations as the minivan, leap into a market segment where it is not represented: the fast-growing sport-utility line. Some 732,000 sport-utility vehicles, including such models as the Jeep Cherokee, Ford Bronco II and Chevy S-10 Blazer, were sold last year, offering a new kind of competition to the suburban station wagon. That total could reach 1 million...
Along with AMC's assets will come some sizable debits. Product-liability suits claiming damages of more than $1.7 billion have been filed against AMC for turnover accidents in Jeeps. Those injured claim that, among other things, the vehicle's roll bar offered inadequate protection. Under the proposed agreement, Chrysler will assume liability for any damages assessed up to an undisclosed ceiling, and Renault will help with any payments above that...
...with AMC in 1979. The timing of the retreat is peculiar. AMC is about to introduce a new midsize sedan, the Premier, in October. The car, expected to sell for around $12,000, will still be built at the Canadian plant that Renault has now agreed to sell to Chrysler. This month Renault has begun exporting to the U.S. a new $10,000 compact, the Medallion, which Chrysler would continue to market. In addition, a new $30,000 Renault sports car, the Alpine, is due to appear in the fall, and that too will be sold by Chrysler. Said...