DETROIT - Even Robert Reich can't keep this ridiculous story straight. In a commentary on public radio's "Marketplace" Wednesday, the Clinton administration labor secretary opposed plans to give General Motors a loan guarantee to help it buy Chrysler from Cerberus. Yes, he's getting the $25-billion federal loan guarantees package for development of clean, fuel-efficient cars and trucks mixed up with the out-of-control stories that GM is about to buy Chrysler.
 

I need to make this clear. It's not happening. That is, it's not as far along as most news outlets, including The New York Times, The Wall Street Journal, Bloomberg, and Detroit's two local dailies are reporting. It may not be much more than some upper-middle-management type at GM looking at the numbers. As I wrote in my last post, GM has not, so far, explored the synergies between its lineup and Chrysler's, as it did two years ago when it considered buying the company from Daimler. In that post, I wrote that the only way GM would make buying Chrysler work would be to kill off everything but Jeep and perhaps the minivans (as has been suggested at other online sources) much as what Chrysler did when it obtained Jeep by buying American Motors in 1987.

Bloomberg on Thursday quotes sources as saying Cerberus may keep a portion of Chrysler Finance and/or take an equity stake in GM if GM buys Chrysler. And by the way, Bloomberg reports, Cerberus also is in talks with Nissan and Renault (not the same company, but have an alliance that includes shared boards) about a possible linkup with Chrysler.

So let me get this straight: GM is trying to wrap up a deal to buy Chrysler while Chrysler also is in talks with Nissan and Renault? One grain of truth in this story is the Nissan/Renault connection, in which Chrysler could be brought in as a third arm of the alliance and share more platforms. I'd say that's a bigger possibility than GM buying Chrysler.

Chrysler may be looking at sharing platforms with Fiat, as well. Yes, the same Fiat that GM had to pay $3 billion just to avoid a contractual obligation to buy the Italian automaker. Let's hope the geniuses who put that deal together a decade ago aren't in on "talks" with Chrysler.

The other grain of truth is this: Despite insisting it's in the car biz for the long haul, Cerberus clearly wants to shed itself of capital intensive, time-consuming Chrysler. An alliance with Nissan and Renault, or a factory-sharing deal with Fiat, wouldn't solve that problem. A sale to GM would, so why not hype it up? Off the record, of course.