Unions Cheer Private Equity Takeover of Chrysler

What’s with this new-found love affair between the auto unions and private

equity? The main auto unions in the US, Germany and Canada all can’t seem to

say enough good things about the $7.4 billion deal wherein Cerberus

is buying Chrysler. The deal seems to be that the unions will embrace the

offer in return for assurances that there won’t be any job cuts, which seems

to be a reasonably sensible quid pro quo, Cerberus’s history of slashing and

outsourcing jobs notwithstanding.

Cerberus will now control not only Chrysler but also Delphi and GMAC, which

is a little ironic. First the Big Three start selling off their suppliers and

their financing arms, only to see Cerberus bring not only those former subsidiaries

but now also a carmaker itself back under one roof. Maybe the spinoffs were

more desperate than they were sensible.

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