GM selling stake in Fuji Heavy Industry

[andy82471]

http://www.marketwatch.com/news/yhoo/story...972E93065C67%7D

So much for Toyota not aquiring the competition to expand. Wonder what Subaru really has to offer anyway ?

[SingleStylish]

Where did you get that Toyota was buying it?

[nyscene911]

The first paragraph.

[Spike]

Here is the press release: DETROIT – General Motors Corp. (NYSE: GM) today announced the sale of its approximate 20 percent equity stake (about 157 million shares) in Fuji Heavy Industries (FHI). The alliance between GM and FHI will end and GM will refocus its efforts and resources in the Asia Pacific region’s high-growth markets and with its other strategic partners. Toyota Motor Corporation will purchase 68 million shares, or approximately 8.7 percent, of FHI shares outstanding, from GM for JPY 520 ($US4.60) per share, or about US$315 million in cash. GM intends to divest its remaining 11.4 percent interest by offering for sale its shares (89 million shares) into FHI’s 90 million share open-market buyback program announced earlier today, and through market sales if necessary. “We’ve had a good partnership; however both GM and FHI came to the conclusion that there were not enough collaborative projects to sustain the alliance and that each of our interests could be better served through a different approach,” said Troy Clarke, GM group vice president and president, GM Asia Pacific. “We have a great deal of respect for FHI and Toyota . We wish them well in their new relationship.” The divestiture of GM’s stake in FHI is expected to be completed in the fourth quarter. Since GM acquired a stake in FHI in 2000, the companies have been involved in various joint projects in product development, advanced technology, global purchasing and supply chain management, and product distribution. GM currently partners with FHI on one production vehicle, the Saab 9-2x, which will continue. Other joint arrangements with FHI will be dissolved over time. For example, GM and FHI’s previously announced Saab crossover vehicle development program will be cancelled. Also today, GM will file a Form 8-K at the Securities and Exchange Commission describing a restatement of its second quarter 2005 financial statements to reflect a reduction of between $700-$800 million in the carrying value of its FHI stock. The sale by GM of its interest in FHI, including cash proceeds received and any potential gain on sale, will be recorded in the fourth quarter. I do find it interesting that they are still continuing with the next 9-2x, however, Saab will not be getting the crossover.

[Clownzilla]

To Toyota of all people.....................Anyway, since they announced no Tribeca-SAAB crossover will be made, what will they use? The SRX was deemed too costly to make different enough for SAAB. Wonder if that new Opel crossover will be a possibility?

[Spike]

What about somethhing Lambda based?? Edited October 5, 2005 by Spike

[jd2b]

Good! Fuji was not willing to share its technology and was somewhat of a pain in GM's side. It is however upsetting that Toyota picked up more shares. The only technology that Fuji had that was worth while for GM was a quick AWD application, but with Theta, Lamda and the Epilson II Utes we are so close to having GM's own AWD system improved and use expanded that it is too late for Fuji to be of any help. Edited October 5, 2005 by jd2b

[Clownzilla]

Well, GM states that they want to look into other partnerships in the Asia-Pacific region. I hope they work more closly with Suzuki to develop some more small engine tech (Don't they own 50% of Suzuki?). I think that would be a better investment than working with Subaru. Subaru has given GM a low volume 92x, a future low volume 96x, and.............and............? Subaru can give GM MUCH more meaningful contreibutions.

[Clownzilla]

Subaru can give GM MUCH more meaningful contreibutions.

[post="24226"]<{POST_SNAPBACK}>[/post]

I mean Suzuki

[jd2b]

Well, GM states that they want to look into other partnerships in the Asia-Pacific region. I hope they work more closly with Suzuki to develop some more small engine tech (Don't they own 50% of Suzuki?). I think that would be a better investment than working with Subaru. Subaru has given GM a low volume 92x, a future low volume 96x, and.............and............? Subaru can give GM MUCH more meaningful contreibutions.

[post="24226"]<{POST_SNAPBACK}>[/post]

And the worse part is that Subaru was unwilling to share is best WRX technology for the 9-2X with GM, granted not many companies would want to share their top products but in Subaru's case only their top technology is of any use to GM. Quite frankly they would have more to gain from GM then the other way around.

[SingleStylish]

Suzuki is owned by FHI. Sorry, missed that first paragraph since it was so littered with stock symbols.

[SoCalCTS]

GM owned 20% of Subaru and got very little out of the deal. Toyota will own only 8.5% and probably won't get much more out of Subaru than GM got. The only real plus for Toyota is access to Subaru's Indiana manufacturing plant.

[haypops]

The only real plus for Toyota is access to Subaru's Indiana manufacturing plant.

[post="24240"]<{POST_SNAPBACK}>[/post]

I hadn't thought of that one; interesting.

A big plus for GM would be if the Wall Street Analysts like it and raise their bond rating. Also may help a little with UAW negotiations (as in see we really need th e money).

[Shantanu]

If you put your money into something, that money is tied up. GM's Subaru stake was a useless investment. Roger Smith thought that he could get robots to make cars for GM in the 1980's. Along those same lines, Rick Wagoner went buck wild in the 1990's and bought up a whole bunch of stakes in automakers like Fiat, Subaru, Isuzu, etc. thinking that GM could have other companies build cars for it, so that it's CEO's could play golf all day. Needless to say, it did not work. Subaru's technology was incompatible with GM's. Something having to do with wierd engine arrangements. After several years of nothing, they collaborated on one project, the Saab 9-2X, which was a mega flop. Basically GM needs to free up some cash and use that money to invest in GM's own divisions. That will be the only way GM can redeem itself.

[Newbiewar]

Basically GM needs to free up some cash and use that money to invest in GM's own divisions.  That will be the only way GM can redeem itself.

[post="24283"]<{POST_SNAPBACK}>[/post]

nice....

so true


CAMARO!

[Newbiewar]

Suzuki is owned by FHI.  Sorry, missed that first paragraph since it was so littered with stock symbols.

[post="24235"]<{POST_SNAPBACK}>[/post]

you mean suburu right?

[regfootball]

maybe its cheaper for daewoo to do what fuji was doing.

[SimonDavid]

I agree with Clownzilla - they should concentrate on Suzuki - I think up their stake to 51% and merge it with Daewoo I think in terms of volume Suzuki is actually number 3 in alot of Asian markets - including Japan - because they are so strong in the small cars that dominate there. With Daewoo's low-cost manufacturing capacity it would be a kller combination.

[Newbiewar]

I agree with Clownzilla - they should concentrate on Suzuki - I think up their stake to 51% and merge it with Daewoo

I think in terms of volume Suzuki is actually number 3 in alot of Asian markets - including Japan - because they are so strong in the small cars that dominate there.  With Daewoo's low-cost manufacturing capacity it would be a kller combination.

[post="24360"]<{POST_SNAPBACK}>[/post]

i'm assuming, Suzuki, is behind Toyota, and Nissan...

but how much stock doest GM have in Suzuki? and if its 51% or around that amount, why dont they just buy it all?

i guess money is in short supply...

what advantages does Suzuki give to GM?

[Clownzilla]

i'm assuming, Suzuki, is behind Toyota, and Nissan...

but how much stock doest GM have in Suzuki? and if its 51% or around that amount, why dont they just buy it all?

i guess money is in short supply...

what advantages does Suzuki give to GM?

[post="24390"]<{POST_SNAPBACK}>[/post]

I'm pretty sure that GM has 49% or 50% of Suzuki, 51% is considered a majority in stock ownership. At that point, they could do a lot more than they could do at 50%. The whole company would be nice but Suzuki might not want to sell to GM, plus it might take money that GM dosen't have. Suzuki would be great because they are VERY dominent in the Japanese compact, subcompact, and micro car markets. They know how to make compacts, subcompacts, microcars, and small engines. True, many won't be legal in the USA but they could adjust some for the USA and/or use their small engine knowhow for the USA market. Plus this would create MASSIVE inroads to the USA market for GM. Here's an idea (some will be angry for me saying this), if the only thing keeping GM from buying Suzuki were money, how about selling off Opel, Vauxhall, Holden, SAAB (in any combination) to make enough money for the purchase. Would any of these GM brands be worth the sacrafice? Just a question.................

[Clownzilla]

Plus this would create MASSIVE inroads to the USA market for GM.

[post="24402"]<{POST_SNAPBACK}>[/post]

The sentence should read Japanese, not USA

[SingleStylish]

Those who believe GM got absolutely nothing out of this and that the only vehicle it begot was the lowly 9-2X... sorry to disappoint you but GM got this: 1. Diesel technology and engines and a lot of help on the ground up design of the Duramax; 2. Heavy Duty Fuji trucks for the W class GMC and Chevy lines; 3. Colorado and Canyon; 4. Sheet metal stamping technology that reduces the amount of time and material needed to produce one mold; 5. Expansion and products into areas of Asia GM never sold to; Those who think this was a waiste of money just don't see the facts. GM spent good money to get good intelligence. Without this think tank GM would have never had a competent disiel program. They essential took the knowledge and technology and now build their own... smart on GM's part... NOW what do you think Toyota wants??? I am guessing or betting on a light duty diesel engine... for what you say??? Hmm... maybe a plant in Texas...

[Robert Hall]

Those who believe GM got absolutely nothing out of this and that the only vehicle it begot was the lowly 9-2X... sorry to disappoint you but GM got this:

1.  Diesel technology and engines and a lot of help on the ground up design of the Duramax;

2.  Heavy Duty Fuji trucks for the W class GMC and Chevy lines;

3.  Colorado and Canyon;

4.  Sheet metal stamping technology that reduces the amount of time and material needed to produce one mold;

5.  Expansion and products into areas of Asia GM never sold to;

Those who think this was a waiste of money just don't see the facts.  GM spent good money to get good intelligence.  Without this think tank GM would have never had a competent disiel program.  They essential took the knowledge and technology and now build their own... smart on GM's part...

NOW what do you think Toyota wants???  I am guessing or betting on a light duty diesel engine... for what you say???  Hmm... maybe a plant in Texas...

[post="24419"]<{POST_SNAPBACK}>[/post]

Hmmm...aren't 1-3 Isuzu and not Fuji/Subaru JVs?

Isuzu is not part of the Fuji/Subaru alliance..

Point 5 is being achieved with GM Daewoo... Edited October 5, 2005 by moltar

[SingleStylish]

Isuzu is a part of FHI likewise the Isuzu heavy duty trucks are Fuji trucks. I don't think GM divesting itself of FHI is bad especially given your latter point about GMDAT but, I don't think that the investment was a dumb move either. This invesment played out much to GM's advantage more that the Fiat debacle did.

[Robert Hall]

Isuzu is a part of FHI likewise the Isuzu heavy duty trucks are Fuji trucks.

I don't think GM divesting itself of FHI is bad especially given your latter point about GMDAT but, I don't think that the investment was a dumb move either.  This invesment played out much to GM's advantage more that the Fiat debacle did.

[post="24428"]<{POST_SNAPBACK}>[/post]

Interesting...first I've heard of a relationship between Isuzu and FHI...I thought they were competitors. There is no mention of any such relationship on the FHI or Isuzu corporate websites that I can find.. Edited October 5, 2005 by moltar

[Ghost Dog]

Isuzu is not Related to Fuji Heavy.

[sciguy_0504]

How was money was spent on current Saab-Subaru collaborations? Hopefully less than the amount GM got for selling its stake.

[Robert Hall]

I wonder what they will do for the next-gen 9-2x... base it on the HHR or Suzuki's Grand Vitara? Something with Daewoo maybe?

[jrockb4]

I wonder how much cash they can ultimately get for their share? Subaru is hot right now though still a nuiche boutique maker. GM could sure use a big infusion of cash.

[ehaase]

$700 million won't begin to solve GM's problems, but I never saw the purpose of this investment to begin with.

[Guest YellowJacket894]

So, I'm guessing that the 9-2X won't be around for too much longer, right?

[Spike]

WSJ says that the current 9-2x will be around until the current WRX gets replaced.... Edited October 6, 2005 by Spike

[Cadillacfan]

In related news, Toyota acquired all domestic and overseas GM brands, GMAC, overseas acquisitions, and vehicles except for the Sunfire. GM was allowed to keep that car. 98.4% of the jobs were sent overseas. Toyota’s CEO Fujio Cho said that he did not want to put all those Americans out of work. They were just in the way of Toyota spreading it's love across the land. THE END!! ^_^

[Northstar]

It's unfortunate that the 9-6X got cancelled, but I guess that's one more reason to sell/kill Saab now. IMO, in times like these, GM doesn't need brands like Saab that just add to the red ink. By the end of the decade, GM could very well consist of: Chevy Cadillac Saturn GMC is redundant, Buick's sales are dwindling and their RWD cars got "delayed" until at least 2010, Pontiac has the Solstice, GTO, and what else that's not redundant (and the Sky makes the Solstice redundant), Saab bleeds red ink, Hummer probably makes money so it might stand a chance, and GM seems committed to Saturn (which is why it made the list of three brands that would survive). I don't mean to get off topic, but this seems to be the current state of affairs.

[Guest Josh]

I have a feeling this sale is going to "bank" on the bail-out of Delphi. Something I hope does not happen. General Motors needs to let Delphi spin out of control on their own, not assume any debt, nor sell any assets due to mis-management.

[daves87rs]

It's unfortunate that the 9-6X got cancelled, but I guess that's one more reason to sell/kill Saab now. IMO, in times like these, GM doesn't need brands like Saab that just add to the red ink.

By the end of the decade, GM could very well consist of:
Chevy
Cadillac
Saturn

GMC is redundant, Buick's sales are dwindling and their RWD cars got "delayed" until at least 2010, Pontiac has the Solstice, GTO, and what else that's not redundant (and the Sky makes the Solstice redundant), Saab bleeds red ink, Hummer probably makes money so it might stand a chance, and GM seems committed to Saturn (which is why it made the list of three brands that would survive).

I don't mean to get off topic, but this seems to be the current state of affairs.

[post="24631"]<{POST_SNAPBACK}>[/post]

If you look at the current Saabs...and what they are doing to them-it pretty
easy to say Saab is on its way out of the GM line-up...probably within the next
few years. Rumor has it that they are only propping it now with its current sellers
is to make it look good to sell. 9-7x, anyone? Mark my words-Saab is gone. :(

Hummer is will stick around until GM gets bored with it.

I don't think the other division are in trouble yet....you are just seeing them
shrinking and adjusting to the new market. There is no point to have a full
car line for each division. Those days are over.

If Gm does well in the next 5-10 years...more models could come back.


Getting back on topic though..look for this to be the start of more sell offs...

That I know. :(

[daves87rs]

I have a feeling this sale is going to "bank" on the bail-out of Delphi. Something I hope does not happen. General Motors needs to let Delphi spin out of control on their own, not assume any debt, nor sell any assets due to mis-management.

[post="24635"]<{POST_SNAPBACK}>[/post]

I pretty sure it will not. You think GM's stock is bad now? Watch it drop like a
rock if they bail out Delphi.

They simply can't afford to. Just don't be suprised if GM starts to look overseas..

Don't want to say much more than that... :unsure:

[daves87rs]

WSJ says that the current 9-2x will be around until the current WRX gets replaced....

[post="24545"]<{POST_SNAPBACK}>[/post]

They simply could get rid of this waste of money, and nobody would even care...

I say it gets canned sooner than that...

[Guest Josh]

I pretty sure it will not. You think GM's stock is bad now? Watch it drop like a
rock if they bail out Delphi.

They simply can't afford to. Just don't be suprised if GM starts to look overseas..

Don't want to say much more than that... :unsure:

[post="24638"]<{POST_SNAPBACK}>[/post]

They can't produce vehicles overseas any faster than they are. So, I'm not worried about that at all.

[daves87rs]

They can't produce vehicles overseas any faster than they are. So, I'm not worried about that at all.

[post="24649"]<{POST_SNAPBACK}>[/post]

Sorry Josh-I meant the parts, not the cars themselves...

[VenSeattle]

Eh... I'm not concerned about Buick/Pontiac/GMC disappearing anytime soon... GM can not afford to pay off all those dealerships for closing their doors. I think BPG will be able to sustain 1,000,000 annual sales with what they're getting in the near future. I'm sure that's enough to keep them profitable between the three of them. Even if it's not, that's too much market share to just walk away from in the next 5 years. I seriously think GM would declare Bankruptcy and re-org before they lose another 1,000,000 annual sales. I can see GM selling Saab to Subaru. I think that would be best for GM, SAAB & even for Subaru.

[SimonDavid]

1) In answer to Clownzilla, GM's current stake in Suzuki is 20%. So yes they probably don't have the cash to buy it out now, unless they can arrange some kind of share swap. But I thing Wagonner should have raised that stake to 51% years ago instead of messing around with Subaru - GM paid 2 billion in cash for the FHI stake. 2) I doubt that GM are going to close down SAAB. They are in the process of integrating SAAB into Opel - SAABs will be built in Opel factories on Opel platforms (think Golf/A3), so soon it will be physically very difficult to separate it from GM anyway. GM needs a premium brand in Europe - premium is starting to dominate the market here. The 3 series outsells the Ford Mondeo 3 to 1 3) The reason GM is under pressure to bail out Delphi is because under the terms of Delphi's spin off a few years ago GM is still liable for Delphi's pension liabilities if Delphi files for chapter 11 before 2007. So I think it will be a relatively short term bailout. For a company run by accountants GM has done some silly deals.....

[Shantanu]

I always wondered why GM never allied themselves with a "winner" like Toyota, Honda, or BMW. Subaru is a company that's going nowhere. Sure, they have a following in hilly parts of the snowbelt, the riceboy movement in LA, and amongst lesbians, but all of those are niche groups. There's no mainstream Subaru appeal. And now their best salesman Crocodile Dundee is getting old, and other automakers have encroached on their turf of making AWD cars. Also, I've seen hemorrhoids that look more attractive than Subaru's new lineup of vehicles. :puke:

[Clownzilla]

I always wondered why GM never allied themselves with a "winner" like Toyota, Honda, or BMW.

Subaru is a company that's going nowhere.  Sure, they have a following in hilly parts of the snowbelt, the riceboy movement in LA, and amongst lesbians, but all of those are niche groups.  There's no mainstream Subaru appeal.  And now their best salesman Crocodile Dundee is getting old, and other automakers have encroached on their turf of making AWD cars.

Also, I've seen hemorrhoids that look more attractive than Subaru's new lineup of vehicles. :puke:

[post="24723"]<{POST_SNAPBACK}>[/post]

I can't agree that Subaru is going nowhere, they are getting more customers. The fact is though, I can't ever see them even close to being as big as other players in the market.
Subaru is a niche car, and are doing very well for a niche car. They are not (nor I don't think ever will be) a high volume, mass market car. That said, I think GM does need to get with a winner. Subaru is a stable company, but not the "winner" that GM needs.

[VenSeattle]

My problem with Subaru's current direction is that they're moving too far up-market... well, attempting to. They haven't succeeded yet. That's why I think SAAB would be a good brand for them. Let Subaru serve as a mainstream division while they use their premium ideas to rebuild SAAB as a luxury brand above Subaru. Even selling them on the same showroom floor wouldn't be a problem for many areas.

[Clownzilla]

My problem with Subaru's current direction is that they're moving too far up-market... well, attempting to. They haven't succeeded yet.

That's why I think SAAB would be a good brand for them. Let Subaru serve as a mainstream division while they use their premium ideas to rebuild SAAB as a luxury brand above Subaru. Even selling them on the same showroom floor wouldn't be a problem for many areas.

[post="24874"]<{POST_SNAPBACK}>[/post]

As much as I hate to see it go, I think you are on the right track. SAAB would thrive more being owned by Subaru. The dealership I work at has sold SAAB for 2 years, we are in a pretty good sized city (with good sized surrounding cities) and we sell around three per month. We have other GM makes for volume, but I would hate to be a stand alone SAAB dealer, yet there are quite a few of them. I think Subaru can give SAAB the product and attention that they need. I always hoped that GM would let SAAB be the BMW-Mercedes fighter (for the snoobs that buy non-domestic cars only), but GM needs to pump Cadillac up (which is doing well already, keep rolling), and with limited cash, SAAB is getting f%@#$*! In all, SAAB is a better fit for Subaru.

[TKR]

Europe is a problem for GM. Opel has moved upmarket - too far upmarket and is now a competitor for (you guessed it) SAAB. Opel cannot move down now because Chevrolet is doing well with the GMDAT product (which is going to get much better over the next few years) Is the US market big enough to sustain SAAB, especially now that Cadillac has once again become the brand of choice for many people - I don't think so unless SAAB is treated as a niche premium product that will appeal to those who love SAAB's (you know who you are....). You do have to wonder how GM managed to get itself into this? Someone mentioned selling Holden to buy the rest of Suzuki - you have got to be kidding me. As for Isuzu, well until GM find another place to design and build mid size pickups they need Isuzu. The biggest problem with Isuzu is that they thought they could continue make cars. They need to concentrate on commercial vehicles and diesel engines (which are usually almost bulletproof).

[Sixty8panther]

WTF? OF all the Japanese brands GM was afiliated wiht Subaru was by far the coolest. :angry: They should have gotten rid of Suzuki, Isuzu & Daewoo instead. his is like selling park place in Monopoly but keeping belmont. Stupid.

[Flybrian]

WTF? OF all the Japanese brands GM was afiliated wiht Subaru was by far the coolest. :angry: They should have gotten rid of Suzuki, Isuzu & Daewoo instead.

his is like selling park place in Monopoly but keeping belmont. Stupid.

[post="26553"]<{POST_SNAPBACK}>[/post]

You're looking at it from an Subaru enthusiast's prespective, which means nothing.

Isuzu garned medium-duty trucks and diesel engine technology, plus a presence in difficult Asian markets.

Daewoo is providing small car technology, know-how, and platforms. The Aveo is a damn nice car for a subcompact. Also, a presence in the Asian and European markets.

I'm sure somone can elaborate on Suzuki's contributions, though I suspect they're similar to Daewoo's.

Subaru provided very little or perhaps more accurately, GM collaborated on very little, especially in regards to AWD technology. If you ask me, GM only screwed up by not exploiting AWD more. But to imply that Isuzu, Daewoo (which is Korean, btw), and Suzuki are less-valuble because they aren't as "cool" shows a lack of understanding about what benefits GM.

[CaddyXLR-V]

You're looking at it from an Subaru enthusiast's prespective, which means nothing.

Isuzu garned medium-duty trucks and diesel engine technology, plus a presence in difficult Asian markets.

Daewoo is providing small car technology, know-how, and platforms. The Aveo is a damn nice car for a subcompact. Also, a presence in the Asian and European markets.

I'm sure somone can elaborate on Suzuki's contributions, though I suspect they're similar to Daewoo's.

Subaru provided very little or perhaps more accurately, GM collaborated on very little, especially in regards to AWD technology. If you ask me, GM only screwed up by not exploiting AWD more. But to imply that Isuzu, Daewoo (which is Korean, btw), and Suzuki are less-valuble because they aren't as "cool" shows a lack of understanding about what benefits GM.

[post="26770"]<{POST_SNAPBACK}>[/post]

I agree, GM is making alot more off of Daewoo than they ever could from Subaru. Isuzu is responsible for the Duramax. Subaru didnt want to share its technology.