At one time Tracinda owned a big chunk of GM but sold it after the company rejected his bid to combine GM-Renualt-Nissan. Then Tracinda offered $4.5 billion for Chrysler. All of this automotive refrigerator raiding comes after his firs foray into the Pentastar-ed brand back in the 90's. That move forced Chrysler into the waiting arms of Daimler-Benz, where it was snuggled at arms length until finally being jettisoned into the unknowing grasp of Cerberus. This all goes to show that when Kirk starts buying up shares of American automakers he likes to make a bundle of money have a say, but what is he saying about Ford? Is this a wise investment? Is Ford the automaker of last resort? Is he mad? Is he a genius? Is he both?

It's irrelevant to discuss the business merits of shuttering Pacifica. Chrysler owned the building, which sits just north of San Diego. Around 20 designers worked there, cranking out high-concept stuff that was mainly intended to provide a snapshot of future trends, rather than produce anything destined for immediate real-world production. Back of the envelope calculations suggest that Chrysler will probably save a few million by bringing advance design back to Detroit (and who knows how much they'll get for the real estate, perhaps the true plum in all this).

The larger question, of course, is "Can Chrysler really afford to have no designers on the ground in carland?" Pretty everyone else, save Nissan, does. Numerous automotive trends, short-term and long-term, are shaped in Cali, home to everything from SEMA customization to hot rods to daily commutes to tuners to homebrewed racing leagues. The state's economy is huge—larger than Italy's. It's the biggest automotive market in the known universe, the asphalt arena in which all the carmakers compete. It leads the nation in environmental legislation, making its a test ground as well as a legislative front line for green technologies.

Beyond that, Californians effing love their cars.

And Chrysler, according to statements emanating from the corporate hive, doesn't need to be there anymore.

Chrysler—seemingly in the worst shape of the Big Three, although who can be sure, given the Stygian nature of Cerberus Capital Management—needs exotic design like humans need the Sun. Take it away, and it's game over.

Forget that all the futurecar startups—the Aptivas and Teslas and manifold electric micros—are also located in Cali.

One assumes that some of the Pacifica team will head back to the Mitten-Shaped State, but that would be what we have come to call around here some sad ham.

So who cares if the move makes peripheral financial sense? It a boneheaded cultural move. Chrysler staged a comeback in the public imagination precisely because it led with design, For a while anyway. Only portions of that may have originated at Pacifica, but nevertheless, simply maintaining an advanced shop signaled a commitment to the discipline—and esoteric, specialized one, to be sure, but as anyone who has any understanding of the car biz and history will tell you, an utterly necessary one.

Here's how Chrysler spun it:

"We don't need a California presence to have design leadership," said Chrysler spokeswoman Dianna Gutierrez. "It's more about having a grasp on the global pulse."

I say, caca. Chrysler certainly does, now more than ever. What this looks like, alarmingly, is an early effort to circle the wagons. Chrysler insists this won't affect new product. We'll see. But the thing you want to think about isn't what Chrysler is going to be putting in front of consumers in the next few years—assuming it's still around. No, what you want to think about is what Chrysler will be selling a decade from now.

A grimmer analysis? How about balance-sheet acrobatics, to harvest some value where it's available—namely in lucrative West Cost properties? (Even that's a sort-of-kind-of, given where real estate has been headed in the Golden State recently.) Hello, Tracinda?

That could be Chrysler's new West Coast vision of the future. [San Diego Union-Tribune]

Sweet Peet weighs in on Kerkorian's overture to the union in his attempt to buy out Chrysler and ends up making a very salient point:

"Kerkorian is a hustler with a capital 'H' and that's about as far as his interest in the well-being of a reconstructed Chrysler Group goes. He and York are in it for the short-term play, and your first clue should have been the words, 'Long term, patient investing has been Tracinda's approach...'"

A kinder, gentler, Captain Kirk? Don't bet on it. [Autoextremist]

Related:
Chrysler Group Sales Speculation: An Inconvenient Sale? [Internal]

Kerkorian Offers $4.5 Billion for Chrysler [NYT]

From: Cowser, Kimberly Sent: Wednesday, April 04, 2007 3:09 PM To: Cowser, Kimberly Subject: Bill Vlasic, author of TAKEN FOR A RIDE: How Daimler-Benz Drove Off With Chrysler, is avaliable to comment on negotiations surrounding Daimler-Chrysler's potential sale

Bill Vlasic, author of TAKEN FOR A RIDE: How Daimler-Benz Drove Off With Chrysler —the national bestseller that revealed the behind-the-scenes drama of the 1998 Daimler-Chrysler merger—is available to comment on Daimler-Chrysler's confirmation today that they are in negotiations with a number of parties about the sale of its money-losing Chrysler division.

As this story continues to unfold, I hope you'll keep Bill Vlasic in mind as an expert source. Bill currently covers the automotive industry for the Detroit News and is the author of TAKEN FOR A RIDE: How Daimler-Benz Drove Off With Chrysler, which reveals the behind-the-scenes drama of the 1998 Daimler-Chrysler merger.

I have pasted more information about Bill Vlasic and TAKEN FOR A RIDE below. Additionally, attached please find his article from today's Detroit News. Please let me know if you'd like to see a copy of the book or wish to get in touch with Bill.

Best,

Kimberly Cowser
HarperCollins Publishers

We decided to call one of GM's masters of PR to ask about these rumors of a General Motors / Chrysler combination, but instead of providing a strong denial to the rumors begun early this morning, our sources at the General are doing nothing but claim "no comment." Not a "that's utterly preposterous" or even a "that's absurd" (although we did get a "I wonder where they're getting that?") Nope — nothing other than "no comment." Despite what we've now heard that talks center around requiring the Chrysler Group to find a way to cut employee health care costs out of any potential deal. So does this mean a prolonged negotiation with the UAW on self-health-management? Perhaps. We'll see what happens, but at this point we've got no denial from GM on the rumors and no paper issued. But if it ends up not being GM talking about an acquisition deal, then whom? Chery? Tracinda? What do you think? – Ray Wert

Photo By: Bill Pugliano / Getty Images News

Related:
All Your Automakers Are Belong To GM: General Motors Looking At Acquiring Chrysler Group? [internal]

Kerkorian will sell 14 million more shares of GM stock [Freep]

Related:
Black Friday Comes Early For Kerkorian: Corporate Raider Cuts GM Holdings [internal]

Tracinda back in black on GM stake [Detroit News]

Related:
More on GM-Renault-Nissan [internal]