GM Still Not Interested in FCA Merger, CEO Says

General Motors is big enough without buying Fiat Chrysler Automobiles, CEO Mary Barra said Tuesday.

“We already have scale and we are leveraging that scale,” Barra said in a news conference before GM’s shareholders’ meeting in Detroit. “When you look at the last several years, we have been merging with ourselves.”

She confirmed that Fiat Chrysler CEO Sergio Marchionne sent her an email earlier this year in which he presented the case for the two automakers combining resources. Marchionne has repeatedly said that some automakers won’t be able to invest enough to keep pace with rapidly changing technology without merging with others.

Barra said she shared Marchionne’s email with other GM executives and the company’s board of directors. They decided not to pursue the matter now.

“The best thing we can do is to be totally focused on the GM shareholder and to execute our plan,” Barra said.

The questions came after a Wall Street Journal report Tuesday that Marchionne is asking hedge funds with GM shares to pressure Barra. Harry Wilson, the former advisor to the Obama Auto Task Force, led an effort to get GM to buy back $5 billion of its own shares to boost the stock price. Wilson declined to comment Tuesday on Marchionne’s latest efforts.

There’s history between these two companies, and Barra has learned from it.

In 2005, Marchionne, then newly named CEO of Fiat, extracted nearly $2 billion from GM. At the time, GM owned 10 percent of the Italian automaker with an option to buy the remaining 90 percent. It chose not to do that, but paid Fiat $1.99 billion to end the relationship.

Over the course of that ill-fated partnership, GM spent $4 billion. It still isn’t making a profit in Europe.

So where else will Marchionne go?

Ford CEO Mark Fields, PSA/Peugeot-Citroen CEO Carlos Tavares and Toyota North American CEO Jim Lentz have all said their companies are not interested in dealing with FCA.

He said he would consider unconventional partnerships or mergers across industries with companies such as Apple or Google, but neither tech company has expressed any interest in Fiat Chrysler.

“Fiat Chrysler is like a 1970s car company with a 21st Century CEO,” said Erik Gordon, professor of law and business at the University of Michigan.

Any of the Silicon Valley upstarts are assuming that their primary powertrain will be powered by batteries, an area in which Fiat Chrysler remains well behind its North American competition.

Google is seeking to develop fully automated vehicles that drive themselves without a steering wheel. So assembly, engine and stamping plants with billions of dollars of equipment tied up in gas-powered engines are not something they would need.

“I think Marchionne actually is on a mission to secure the future of the company,” Gordon said. “Behind that bravado is a very smart guy worried about the future of Fiat Chrysler as it now exists.”