Menu

• Home
• Automotive Blog
• Video Car Reviews
• Latest Auto News
• Best Gas Prices
• Saving Fuel Tips
• Green Car Technology
• 150 MPG Extreme Hybrid
• Contact Us

...Continued

Auto Industry Crisis Rolls Out Globally

---

---

As the American automotive industry screeches nearly to a halt, difficulties with car manufacturers all over the world bowl over like dominoes. The answer to the question, “How will they get back up?” looms far in the distance.

"There's nowhere to hide in the automotive sector globally at this point," said auto analyst Gregg Lemos Stein of Standard & Poor's credit rating service. Government bailout is auto makers’ general first choice in weathering the storm in several countries.

In late 2008, the auto industry giants Ford, Chrysler and General Motors (GM) sought government bailouts to avoid bankruptcy, leaving current and future taxpayers to pick up the tab.

One day after U.S. President George W. Bush announced a $17.4 billion auto-aid plan, Canadian leadership committed to about $4 billion in loans to GM Canada and Chrysler Canada on conditions of significant restructuring by March 2009. European and Asian carmakers have also begged their governments for help as auto sales plunged by double digits across the globe.

Japan has slammed the brakes on output with vehicle production shrinking more than 20 percent in November. This suggests to analysts that the Japanese auto industry will continue curtailing similar to its top American competitors.

In Seoul, South Korea, the Ssangyong Motor Company and its Chinese majority shareholder announced it is seeking financial help from the South Korean government on Dec. 29. ‘The Hindu’ news service of India reported on Dec. 29 that Indian automobile sales declined about 18 percent in November, the worst ever in its history.

Also on Dec. 29, Ford announced Turkey’s automotive sector began deteriorating significantly and projects a 35 percent shrinkage in 2009. “The Turkish automotive sector sells 80 percent of its production to foreign countries, meaning that it is almost entirely integrated with global markets," said Ali Ilkbahar, Ford Otosan board member, emphasizing that the faster global markets recover, the more easily the sector will weather the storm.

Global Insight analyst Rebecca Lindland said, "We're not at rock bottom yet. We're still getting really bad news." She also warned that global auto sales will not recover until at least 2010.

Sources
Google News (AFP): “Potential collapse of US automakers caps turbulent year,” 12/28/08
China View News: “Ford official: Turkey’s automotive sector to shrink by 35%,” 12/29/08
The Hindu: “Extra excise on large cars may go; separate package on cards,” 12/29/08
The Detroit News: “Japan’s carmakers slashing production,” Christine Tierney, 12/29/08
New York Times: “Ssangyong Motor seeks aid from South Korea,” Choe Sang-Hun & Bettina Wassner, 12/29/08

What do GM's struggles mean to you and your family? Post your thoughts on our AUTOMOTIVE BLOG

 
                                                                 

---

---