Update: China’s #3 Dongfeng Definitely Casts Eyes On GM

Now, there are fresh and more concrete indications about a possible Chinese move on GM. Hu Xindong, Secretary to the Chairman of China’s third largest auto maker Dongfeng, said they have been contacted by financial groups which have close relationships with GM. Topic of the discussions: A possible takeover. This according to China’s National Business Daily via Gasgoo. …

Meanwhile, Shanghai Automotive Industry Corp (SAIC) has concluded their own negotiations, and officially said they are not considering buying GM. That because of “GM’s huge costs of compensating workers and other follow-up expenditures,” as Wang Liusheng, an auto analyst at China Merchants Securities did put it.

Subtext: Taking over GM nuts and all would have been nuts in Chinese eyes. The Chinese are interested in the assets, but they balk at the liabilities, especially the ones with a UAW attached. Any other outside investor who owns some sanity would look at it the same way.

The pistonheads at TTAC have been predicting the demise of GM for about four years now, and see little of value coming out of the Cash-Starved Three’s revised plan:

General Motors Death Watch 222: The Truth Will Out

Bullshit. Without specifics GM’s public plan is a sham. It’s a PR exercise designed to convince Congress that GM has “gone back to the drawing board” while hiding the truth of the company’s prospects (such as they are) from those of us who earn a living dissecting these “promised land” statements. There will be nothing in the public report that will prove that GM has the capacity to restructure in such a way to become profitable.

As always, the devil is in the details. Yes, brands will be dropped. But the termination will occur as already planned: over time, not immediately. And those brands chopped will be part of an existing sales channel; dealers will lose a franchise, not their dealership. More specifically, Pontiac will die— leaving most dealers with Buick and GMC. Saab and Hummer go away, leaving Cadillac to stand on its own. Saturn will be “re-energized” somehow, not killed. Add that up and it’s a whole lot of nothing. Literally.