DETROIT, General Motors, Renault and Nissan have only begun talking about a possible alliance, but the prospect of such a deal has touched a raw political nerve in the Motor City.þþMembers of Congress from both parties, Michigan’s governor and the head of the United Automobile Workers union have all questioned whether the deal would be good for a state troubled by high unemployment, plant closings and the erosion of its mainstay auto companies.þþRepresentative John D. Dingell, the longtime Democratic congressman whose district includes parts of Dearborn (where Ford is based) and other automaking cities in southeastern Michigan, recalled: “My daddy used to say if it sounds too good to be true, it probably is. As of this time, I’m applying this useful lesson of caution.”þþMr. Dingell, whose wife, Deborah, is a senior official in G.M.’s Washington office, said shareholders and employees of the company had told him they were fearful of an alliance. “Most of them think it’s a bad deal — a bad deal for the company, a bad deal for the state and a bad deal for them,” he said.þþAcross the aisle, Representative Joe Knollenberg, a Republican who represents Bloomfield Hills, Mich., the home of G.M.’s chief executive, Rick Wagoner, and other industry leaders, voiced similar concerns. þþG.M. “should go very slow” in its discussions with Nissan and Renault, Mr. Knollenberg said, especially because the potential remains for a strike at Delphi, G.M.’s big parts supplier, which sought bankruptcy protection last fall.þþHe questioned whether a proposed deal, an idea floated by G.M.’s biggest shareholder, Kirk Kerkorian, was in the automaker’s best interests. “The role of Kerkorian is one that bothers me, and I think it bothers a lot of people,” he said. “He is not necessarily supporting keeping G.M. alive and well.”þþPresident Bush, though he has not commented directly on the proposed alliance, left little doubt at a news conference on July 7 about where he stood on the idea of Renault and Nissan investing in G.M. Asked about foreign companies investing in technology producers, Mr. Bush replied, according to a White House transcript:þþ“On the broader scale, I have no problem with foreign capital buying U.S. companies; nor do I have a problem with U.S. companies buying foreign companies. That’s what free trade is all about. þþ“A lot of the jobs in America exist because of foreign companies investing in our country.”þþMany of the doubts about the potential of such a cross-continental alliance, political leaders in Michigan say, are fueled by lingering bitterness over the 1998 merger of Chrysler and Daimler-Benz. þþInitially promoted as a “merger of equals,” the deal was essentially a German takeover of Chrysler, then the No. 3 American auto company. This spring, Chrysler slipped to fourth place, behind Toyota, which has been planning to expand its presence in North America by adding factories.þþ“The Chrysler thing has left everybody here with a very bad taste in their mouth,” Mr. Dingell said.þþGov. Jennifer M. Granholm has joined those who have raised questions about an automotive alliance. Soon after Mr. Kerkorian sent letters on June 30 to the three companies suggesting that they explore an alliance, the governor told The Detroit News, “Our history has been what is good for G.M. is good for Michigan,” and then added: þþ“This is serious business. This is our major employer. Show me this is good for Michigan. Show me this won’t send jobs to France or Japan. Show me how this helps us and I’ll be on board.”þþThe governor’s spokeswoman, Elizabeth Boyd, said this week that she planned to closely monitor negotiations to ensure that a deal would not be detrimental to Michigan. þþMs. Boyd said Governor Granholm’s concerns did not conflict with her determined lobbying of Toyota and other Japanese companies, whom she visited in Japan this spring, her second visit there in less than a year. “We welcome foreign investment,” Ms. Boyd said.þþRichard M. DeVos, the probable Republican challenger to Governor Granholm, also wants to ensure that the talks do not lead to more job losses, his campaign spokesman, John Truscott, said. Mr. DeVos, whose father founded Amway, is concerned that G.M. might effectively be run far from Detroit if Renault and Nissan were to eventually control the company. “When you lose control of the headquarters, you lose the heart and soul of the company,” Mr. Truscott said this week.þþRarely mentioned in discussions of the alliance is that Nissan has a technical center and design studio in affluent Oakland County, Mich., an area northwest of Detroit that has a large population of Japanese-born residents. Nissan says its technical center employs 474 people and represents an $80 million investment.þþThe county, where G.M. has car and truck factories as well as a truck development center, is staking much of its future on high-technology installations like Nissan’s, said Doug Smith, the Oakland County director of economic development. þþ“If anything, I would think that you’re going to see the investment here even greater because this is where both Nissan and G.M. are,” Mr. Smith said. “I think we’d see growth, not retraction, if the two companies join together.”þþA partnership, though, would increase the uncertainty felt by members of the United Automobile Workers, who face the loss of 60,000 jobs at G.M. and Ford over the next few years, said Gary Chaison, a professor of industrial relations at Clark University in Worcester, Mass. þþThis week, the U.A.W. president, Ron Gettelfinger, said the proposed alliance “raises very serious concerns” for his union, which he said was a major stakeholder in G.M.’s future. þþA sore point for the U.A.W. has been the active role of Carlos Ghosn, the Nissan chief, in defeating an organizing drive in 2001 at Nissan’s plant in Smyrna, Tenn., one of several union drives there that have failed over the years. In a campaign denounced by union leaders as one of “fear and intimidation,” Mr. Ghosn sent workers a videotape urging them to continue the relationship they had with the company.þþ“Ghosn’s view of the U.A.W. is essentially as a drag on the company,” Mr. Chaison said.þþFor his part, Mr. Gettelfinger said this week he was “not confident” that the alliance would come about.þþ
Source: NY Times
