General Motors Corporation chief executive Rick Wagoner says that mergers and consolidation in the domestic auto industry were unlikely - despite the harsh competition and soaring health costs that have driven the US auto industry into the red, according to an interview published Thursday in The Wall Street Journal and reported by dpa. Wagoner, who was at the Geneva auto show, said that the US auto industry has enough factory capacity to produce more vehicles than it sells for at least 10 years. It was expensive, he said, to reduce capacity. "It's hard to take capacity out. It's expensive. There are frequent union issues. There are government regulators," he was quoted as saying. "The auto industry has high barriers to entry and high barriers to exit." To keep their heads above water, the Big Three auto makers - GM, Ford and Chrysler - have slated plant closures over the coming months and years, and the layoffs of tens of thousands of workers. Union employees have made massive concessions on health care insurance and retirement pay. All three companies have sold cars at massive discounts to keep their factories busy. Wagoner declined to comment on reports that GM was considering a merger with Daimler-Chrysler. The soaring costs of health insurance and health care, Wagoner said, has created a "huge competitiveness issue" for the US economy. But he was doubtful that government would effectively come to the rescue. "From where we are today, for the US to embrace a national health care system, if our business strategy was waiting for that, that's high risk," he was quoted as saying.
