GM Selling a Truck Business to Navistar

[SoCalCTS]

New York Times Story

December 20, 2007

G.M. Selling a Truck Business to Navistar

By NICK BUNKLEY

DETROIT — General Motors said Thursday that it had agreed to sell its medium-duty truck business to Navistar International, an Illinois-based maker of trucks and diesel engines.

The companies did not disclose terms of the deal, which they expect to close on in 2008. Analysts have estimated the unit, which includes the GMC TopKick and Chevrolet Kodiak, to be worth about $500 million with annual revenue of $2 billion.

G.M. has been shedding assets outside of its core operations to increase liquidity and focus on its turnaround. In the last year, it has sold controlling stakes in its finance arm, the General Motors Acceptance Corporation, and its Allison Transmission unit.

Navistar, which was formerly known as International Harvester, plans to move production of the TopKick and Kodiak to one of its own factories, although it did not say where. G.M. will retain ownership of the Flint, Mich., plant that currently builds them.

The trucks will continue to be sold at G.M. dealers.

“Navistar’s expertise in building International brand commercial trucks and its track record in the medium-duty segment makes them an excellent choice to acquire and continue growing the business,” said Troy Clarke, the president of G.M.’s North American operations. “We intend to work closely with Navistar to make this transition seamless to our dealers and customers.”

Navistar has been vocal about its interest in G.M.’s medium-duty unit, which built 59,000 vehicles last year, earning 12 percent of the market.

“We are proud to incorporate the G.M. truck brands into our portfolio, and will utilize the scale to build on the success of both the International and G.M. product lines and their respective distribution networks,” said Navistar’s chairman and chief executive, Daniel C. Ustian.

G.M. recently said it was shutting down medium-duty production for five weeks, starting this weekend, because of lower demand. About 500 hourly workers will be on a layoff during that period.

[daves87rs]

This could get interesting....

[Robert Hall]

One factoid I discovered is that there is an Isuzu-badged version of the Topkick/Kodak called the H-series.

[AxelTheRed]

Saw that coming from a mile away.

My question is: is GM going to give Flint another product since that plant runs two production lines, or are they just going to shut the f@#king thing down like everything else in Flint?

But judging by GM's recent track record, that factory will be closed as quickly as possible, sadly enough.

[thegriffon]

That's OK. Navistar should seek a merger with Isuzu anyway (and Iveco while they're at it).

[Duncan]

What'd be really cool is if International were to get creative and maybe build a new Scout on the H3 platform...use the Atlas five, the 5.3 V8 and their own upcoming small diesel for power.

Imagine it with mini-big-rig styling, and that sweeping waterfall grille...

[Shantanu]

GM's cutting off their arms and legs. This is crazy.

[Camino LS6]

What'd be really cool is if International were to get creative and maybe build a new Scout on the H3 platform...use the Atlas five, the 5.3 V8 and their own upcoming small diesel for power.

Imagine it with mini-big-rig styling, and that sweeping waterfall grille...

I'd love to see a new Scout.

[haypops]

GM's cutting off their arms and legs. This is crazy.

Maybe, maybe not. GM either sold or came to some sort of working agreement with International to cede their motor home business to IH under the workhorse brand. IH uses GM engines and transmissions. In the process GM went from an also ran to supplying the drivelines for a superior-to-Ford product. Perhaps IH will grow the medium business also.

[Duncan]

Maybe, maybe not. GM either sold or came to some sort of working agreement with International to cede their motor home business to IH under the workhorse brand. IH uses GM engines and transmissions. In the process GM went from an also ran to supplying the drivelines for a superior-to-Ford product. Perhaps IH will grow the medium business also.

International already owns a good chunk of the medium-duty business with their DuraStar (4000-series) line. GM's efforts cover (mostly) the lower end of that market and are sold at a totally different collection of dealers, so it's a decent fit.

Also, I'm sure International wouldn't mind getting an "in" with Isuzu through GM...