Ford and General Motors - parent of the Opel, Saab and Chevrolet marques - have confirmed they talked this summer about a deal between the two largest US car makers, while both were shutting factories, cutting tens of thousands of jobs and discussing possible outside partnerships.
People familiar with the talks said there was "one discussion" and it did not lead anywhere. "There is nothing going on," one insider said.
The talks, which were reported in the trade magazine Automotive News, emerged as Ford surprised Chinese rival Shanghai Automotive Industry Corp (SAIC) by exercising its right to buy the defunct Rover brand name from Germany's BMW.
Ford had the right to match the €24 million SAIC agreed to pay for the marque as a result of the US car giant's €3 billion acquisition of Land Rover six years ago. Ford said this week that it had retained Sir John Bond, former chairman of HSBC Holdings, as a part-time consultant to executive chairman Bill Ford.
Sir John, who is a Ford director and chairman of UK-based Vodafone, will advise him on "financial and other matters". He will be paid $25,000 a day, to a maximum of $262,500 a year.
Ford also recently hired Kenneth Leet, a former Goldman Sachs investment banker, to advise on asset sales and other strategic issues. Sir John will remain on Ford's board but has resigned from the compensation and governance committees.
The Ford/GM negotiations were part of attempts by both car makers to look for radical solutions to the crisis besetting the Detroit motor industry. According to people familiar with the talks, Fritz Henderson, chief financial officer of GM, discussed a possible alliance or co-operation with Don Leclair, his counterpart at Ford.
It is not clear who initiated the contact, but Ford was in the midst of a strategic review that it said included examining "all options".
GM is pursuing separate discussions with Renault and Nissan about a three-way partnership, but does not expect to decide until the middle of next month whether a deal makes sense.
Ford and GM both declined to comment.
The purchase of the Rover name appears expensive compared to the £10 sale of the company and a licence for the name to four British businessmen six years ago.
MG Rover, as it became, collapsed last year and the assets plus the MG name were sold to Nanjing Automobile of China, while the Rover brand returned to BMW. SAIC is understood to hope it can lease the name from Ford.
- Financial Times service