Ford Put Brakes on GM Merger Talks

Company vows to survive, may sell Mazda stake for cash
By Wesley Oliver,  Newser Staff
Posted Oct 11, 2008 5:34 PM CDT
Ford Motor Co. Chief Executive Alan Mulally has rejected talk of the company declaring bankruptcy. "It makes absolutely no sense to us," Mulally said.   (AP Photo/Paul Sancya)
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(Newser) – Ford rejected merger overtures from GM earlier this year and decided to ride out its financial issues alone, the Wall Street Journal reports. The GM-Ford talks were “very loose and preliminary, more exploratory in nature than anything else,” a source said. Both companies have denied bankruptcy rumors, but credit rating agencies and analysts have raised concerns about their high rate of spending.

“These are not normal times,” an analyst told the New York Times. “The biggest problem is cash and whether these companies will have enough to survive this downturn.” Still, Ford’s CEO says declaring bankruptcy “makes absolutely no sense;” the company would prefer to sell its stake in Mazda for quick cash. GM has turned to Chrysler for a possible merger, but sources say they are waiting for market turmoil to subside first.