Carmakers spend billions to differentiate components "not discernible to consumers," says Sergio Marchionne. Does every carmaker really need its own 1.3 liter 4-cylinder engine? Its own axles? There are strongly-held beliefs on both sides.
Automotive News surveyed dealers on pricing trends and what greater parts sharing by automakers might mean at the retail level. Here's what they said:
Mergers always flop, right? Not so. We look at the handful of mergers/long-term collaborations that were successful, and ask: why did they work?
Analyst Arndt Ellinghorst says Fiat Chrysler CEO Sergio Marchionne is "running a company which is probably the most challenged within the global industry." So is Marchionne's "Confessions of a Capital Junkie" just a fancy way of putting FCA up for sale? Marchionne says no. Neither is it "an excuse for FCA's current ranking in the automotive food chain," he says.
Still, why do so many people have such grave doubts about an automaker that keeps setting sales records in the United States?
Sergio Marchionne is right. The problem is real. Automakers can't go on consuming capital the way they have.
They can't hope to meet the demands of consumers, regulators and investors without taking a hard look at how they spend their money.
On this much, the minds of the auto industry agree. But it's Marchionne's talk of mergers and takeovers -- even hostile ones -- that makes the industry cringe, and not without reason. Automotive history is rich with stories of deals gone sour, cultures clashing, "synergies" unrealized and employees embittered.
And besides, most automakers have concluded, there are better ways -- or at least other ways -- to conserve, consolidate and collaborate without the need to smash two companies into one.