10-02-2008, 08:44 PM
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#2
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Senior Member
Join Date: Aug 2007
Location: Okolona, Ky.
Posts: 5,911
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Granny says, "Now dey know what dey done to us...
Global auto slowdown may compound carmaker woes
Thu Oct 2, 2008 - Automakers have all but written off a recovery in the U.S. market, the largest in the world, until 2010.
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Now for the really bad news: The U.S. economic malaise has spread to other key markets, including Europe, killing hope international demand could help offset deep losses in North America. That prospect lands heaviest on the U.S.-based automakers General Motors Corp and Ford Motor Co, which have relied in on strength overseas to make up for market share losses and financial straits at home.
The doom and gloom in the U.S. market was reflected in September auto sales, which fell below 1 million for the first time since 1993 amid the severe credit crunch that has rocked U.S. consumer confidence, especially in the last 10 days of the month. With the ripples from the U.S. credit crisis now putting pressure on the world economy, U.S. automakers may be forced to cut costs in Europe and emerging markets such as Russia and China that are slowing, analysts and industry executives said.
"One of the safe spots for GM and Ford was their ability to make money overseas to help offset some of the problems here at home," said Erich Merkle, an analyst with Crowe Horwath. "As we go through this year and next, they are not going to be able to count on that." Merkle forecast that U.S. automakers may cut production in overseas markets to align costs with lower demand and may have to scale back growth plans in emerging markets such as Russia.
More Global auto slowdown may compound carmaker woes | Special Coverage | Reuters
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Auto sales wobble in June, GM plunges
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