Both companies have no choice but to adjust to the market demand. It is not a choice. If market demand for trucks and SUVs is lower than their production, then sooner or later production comes down. Hence the combination would allow them to both adjust production (down) and still remain a large company with a lot of resources. From that perspective merger makes sense.
However, the demand may continue to decline and even the combined company may keep shrinking. In that case merger simply buys them some time, postpones the inevitable shrink. Inevtiably they'll have to adjust to the market, not the other way around. The days of GM/F/C driving the market and controlling demand are gone. They need to accept this simple fact.
That means making drastic changes in designs, product types, manyfacturing setup, etc. The typical danger for larger old companies is calcification of the corporate knowlegde, thinking and actions. As GM and Ford hold onto trucks and SUVs, it would appear that the core problem is that they are dominated by engineers and executives who refuse to change and want to keep their current designs and practices at any cost. Even today there are mainframe computers around the world still working away in their 70s/80s view. Even today IBM sells mainframes trying to poertray them as relevant. However, mainframes are now a small niche, irrelevant.
GM/Ford risk becoming a small niche and irrelevant so long as the "old guard" is in charge. Concordantly the main benefit of the merger would be potential to dislodge the old guard and let some young hands take over. Of course, this could happen without the merger, but is less likely and more difficult. The merger reorg offers an easier means to replace bunch of old executives and engineers who refuse to change.
To have any chance of remaining relevant they have to:
1) reduce engine sizes to reduce fuel consumption
2) reduce vehicle sizes to reduce fuel consumption
3) develop hybrid tek
(for real and not as a token gesture)
Note that they need not discard all of their bigger machines. They do need to alter product mix towards smaller machines, leaving trucks and SUVs as a smaller niche.
The merger would present some opporutnities. They will still need people with ba115 to make the necessary changes.