Chrysler and GM CEOs say they would be open to merger

General Motors Corp and Chrysler LLC said they would be open to a merger if the federal government required it as a condition for emergency financing. The statement came as GM Chief Executive Rick Wagoner and Chrysler Chief Executive Bob Nardelli were testifying before the Senate Banking Committee and would appear to revive the chances for a merger that consultants and analysts have said would slash tens of thousands of U.S. auto jobs.

Nardelli said Chrysler’s analysis showed that a merger could shave $8 billion and $10 billion from the operating costs of the combined operations and Wagoner agreed a merger presented an opportunity for “significant cost savings.” He added GM was “willing to look at it and consider it very seriously.”

Senator Robert Bennett, R-Utah, said a Chrysler-GM merger would be worth considering.

“Everything I’ve seen suggests to me a merger between GM and Chrysler is a good idea,” he told the hearing. He went on to say, “It’s a marriage that makes sense. All the work has been done. So it could be done. Papers could be signed very quickly.”

Senator Robert Corker (R-Tennessee), who was openly critical of Chrysler and its owner, Cerberus Capital Management, during the hearings, also supported the idea of merging the two automakers.

However, Senator Jon Tester (D-Montana) said he wanted assurance that government aid would not be used for a merger. Previous merger negotiations between Chrysler and GM had called for as much as $10 billion in government financing. The GM board turned down the merger and the talks were shelved when the administration made it clear such funding would not be forthcoming. Nardelli said he would agree to that if it were a condition of the assistance.