Looking for a real fixer-upper, or just a little payback
 | Edward Lapham is the executive editor of Automotive News. He writes commentaries for Automotive News online every business day. His commentaries also can be found here. |
You can forget about General Motors, Hyundai, and even Renault/Nissan.
That's because the most likely candidate to buy the Chrysler group is a private equity firm.
Private equity capital could do a lot to shore up GM and Ford Motor, too. But that's a column for another day.
Face it: The private equity crowd has deep enough pockets to make it happen. It is estimated that there is more than $100 billion of untapped private equity capital in the United States and the equivalent of another $50 billion in Europe.
And because several of the most active private investment firms have former auto execs as partners, they also have the savvy to understand what needs to be done and how to do it. Right?
What a thought: The next great generation of leadership in Detroit could well be execs who bailed out or were elbowed out of automaker executive suites.
For investors, having a guide who understands the terrain is crucial. Kirk Kerkorian understood that. When Kerkorian went the publicly traded route at GM, Jerry York was his eyes and ears.
Now former Detroit 3 execs such as Jacques Nasser and David Thursfield of Ford, Roy Roberts and Dick Donnelly of GM and Tom Stallkamp of Chrysler are shopping for bargains.
Many of these ex-Detroiters already are getting experience in the buyout game by guiding acquisitions in the supplier community. That's a little like playing Triple-A ball.
Before you know it, they'll be ready for another run at the big leagues.
For a struggling automaker, that could be heaven or that could be hell.
If a departed exec comes back with a realistic business plan, a vision to guide management and enough cash to see it through, it can't get any better than that.
But if he comes back with another agenda …
Well, just remember: Payback is a bitch.
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You can forget about General Motors, Hyundai, and even Renault/Nissan.
That's because the most likely candidate to buy the Chrysler group is a private equity firm.
Private equity capital could do a lot to shore up GM and Ford Motor, too. But that's a column for another day.
Face it: The private equity crowd has deep enough pockets to make it happen. It is estimated that there is more than $100 billion of untapped private equity capital in the United States and the equivalent of another $50 billion in Europe.
And because several of the most active private investment firms have former auto execs as partners, they also have the savvy to understand what needs to be done and how to do it. Right?
What a thought: The next great generation of leadership in Detroit could well be execs who bailed out or were elbowed out of automaker executive suites.
For investors, having a guide who understands the terrain is crucial. Kirk Kerkorian understood that. When Kerkorian went the publicly traded route at GM, Jerry York was his eyes and ears.
Now former Detroit 3 execs such as Jacques Nasser and David Thursfield of Ford, Roy Roberts and Dick Donnelly of GM and Tom Stallkamp of Chrysler are shopping for bargains.
Many of these ex-Detroiters already are getting experience in the buyout game by guiding acquisitions in the supplier community. That's a little like playing Triple-A ball.
Before you know it, they'll be ready for another run at the big leagues.
For a struggling automaker, that could be heaven or that could be hell.
If a departed exec comes back with a realistic business plan, a vision to guide management and enough cash to see it through, it can't get any better than that.
But if he comes back with another agenda …
Well, just remember: Payback is a bitch.
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