I've never heard of 24/7 Wall St. before, and there's a good reason for that, because this article is terrible, littered with inaccuracies and misunderstandings.
"
T-Mobile, the U.S. wireless provider, is owned by telecom giant
Deutsche Telekom (
DTEGY.PK -
News). It is the No.4 cellular company in an American market that only supports two really successful firms -- AT&T Wireless and Verizon Wireless. Even the third-largest company in the market --
Sprint-Nextel (NYSE:
S -
News) -- has 50 million customers. T-Mobile had 34 million customers at the end of last year. T-Mobile only had a profit of $306 million in 2009. That was down from $483 million in 2008."
"A merger with Sprint-Nextel has been mentioned several times."
Sprint is actually losing money ($760 million in the 2nd quarter), so a $306 million profit for T-Mobile looks great by comparison. If anything, Sprint is the endangered company. They are still recovering from a disastrous merger with Nextel. Sprint certainly isn't going to attempt to take on another struggling company right now.
What would be more likely is Deutsche Telekom absorbing Sprint.
"Another alternative would be a merger with Virgin Mobile."
Virgin Mobile in the US is already wholly owned by Sprint. They license the name from Branson.
"Maybe Deutsche Telekom will just change the firm's name."
Why? T-Mobile doesn't have an image or branding problem. They have a technology problem.
Interestingly, this is the exact opposite of Sprint. Sprint, right now, has the best 4G coverage in the country, but the Sprint brand has been tarnished after years of mis-steps.
But the T-Mobile part of this article looks downright scholarly when compared to the Kia part:
"
Kia Motors Corp. is one of the two car brands of Hyundai of South Korea. It has always been a marginal brand."
Kia has increased market share for many years now. They are in expansion mode, opening plants in the US. Kia is one of the top ten best-selling car brands in the US- they are not in any way "marginal".
"Its stable mate, Hyundai USA, has a reputation for high quality cars like the Sonata and Genesis. Kia sells "low rent" cars and SUV nameplates like the Sorento and Rio."
Is this article from 10 years ago? Have they not heard of the Forte and Soul?
"As
GM and
Ford (NYSE:
F -
News) have already discovered, it is expensive to maintain multiple brands and storied car names, including Pontiac, Saturn and Mercury, are disappearing."
That's because none of those brands actually stood for something. There was no reason to get a Mercury instead of a Ford, because they were the exact same car. Hyundai is positioning its Hyundai and Kia brands very differently- Hyundai is being positioned as luxury-and-quality-on-a-budget. Kia is being positioned as fun and youth-friendly. You don't see Ford getting rid of Lincoln, GM getting rid of Cadillac, Toyota getting rid of Scion. That's because all of these brands have a successful niche. Pontiac and Saturn didn't.
"Most Kia cars sell for $14,000 to $25,000. Hyundai has several cars in the same price range. Hyundai's Sonata has quickly become one of the best-selling cars in America, and its Genesis flagship model competes with mid-sized BMWs and Mercedes. The parent company will take a page from several other global car companies and dump its weakest brand."
Hyundai's "weakest" brand is better than some companies "strongest" brand. It'll stick around.
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