General Motors Corp. (NYSE: GM) may be selling its commercial truck division to Japan's Isuzu Motors. The rumor mill is churning this one up quite well this morning, but would it make sense for GM? Sure -- it already has a solid relationship with Isuzu and the Japanese automaker already is the #2 commercial truck vendor in Japan anyway. It would give GM some solid cash while making Isuzu the largest commercial truck manufacturer in its home country.
It would be kind of a reversal for GM if this deal does go through, as the American automaker has given help to Isuzu many times in the past when the Japanese automaker fell on hard times. Now that GM is on the ropes (but no KO yet), the tides have turned quite a bit. Instead of owning 49% of Isuzu, Isuzu may be buying almost all of a major GM division.
GM may even retain some ownership of its commercial truck division but sell the majority of it to Isuzu. There was a deal in progress late in 2007, but an agreement never materialized due to economic changes that began to affect credit markets. We all know where the American economy (and global markets) have been in the last week. Isuzu still has not confirmed reports that it has received an offer, so we'll be waiting.
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Reader Comments (Page 1 of 1)
9-19-2008 @ 2:55PM
Kent said...
Good move by GM-Izuzu. The automotive industries are undergoing a restructuring process for the better. The U.S. may not become the major manufacturing leader in the world as they once were as they dissipate their assets, but we'll still be the leading market. Win-win all around. Advanced economies I believe will eventually relinquish their manufacturing to emerging countries which all falls naturally into place with the post-industrialzed stage of our economic development. Japan is already trending in that direction as we are.