Nissan ends talks with Chrysler

The Detroit News reports that talks between the Renault-Nissan alliance and Cerberus Capital Management have ended. While future discussions have not been ruled out, sources say Cerberus would prefer to come to an arrangement with General Motors.

Neither automaker would comment, but those with knowledge of the negotiations say Cerberus believes a GM-Chrysler deal would be financially more advantageous as well as a better outcome for the U.S. auto industry. Renault-Nissan had proposed a taking 20 percent stake in Chrysler but it is said the two sides could not come to an agreement on a fair value for the Auburn Hills-based automaker. Carlos Ghosn, Renault-Nissan’s CEO, had ruled out large cash payments because of current economic conditions and the state of the automobile industry.

A GM-Chrysler merger had been viewed as almost a done deal until the Bush Administration ruled out government participation late this week. GM had been seeking as much as $10 billion in direct federal investment to finance the takeover which one consultant said could cost as many as 200,000 jobs and drive numerous companies out of business. GM officials reportedly are still trying to work with various government agencies, hoping to make a deal before a new administration and Congress are sworn in next January.

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