Over the last few months, many newspapers and journals have been shifting their focus to America's auto industry. There have been studies relating to costs, benefits, profits, etc. for each American car company (Ford, General Motors, and Chrysler). At the peak of the recession, General Motors and Chrysler were really down in the dumps and accepted government money, but Ford was always relatively strong and rejected any aid from the government. All of this raises the question, is the US auto industry dead?
Personally, I believe that the answer is NO. I have seen immense improvement in Ford (who wasn't even that bad to begin with) and especially GM. For one, according to the Wall Street Journal, Ford has lowered the cost of many of its vehicles, which has led to more cars being bought. Ford clearly understands that in such a recession people don't want to spend so much unnecessary money on a car. Consequently (and also according to the Wall Street Journal), Ford's annual profit for the year 2009 was $2.7 billion, compared to a LOSS of $14.7 billion the previous year. Wow! Ford's great techniques have really helped them! Additionally, GM has really improved, especially due to the fact that just last week they finally sold Saab to Spyker (a Dutch sportsmaker). According to the Financial Times, this trade resulted in GM obtaining $74 million up front, as well as $326 million in preferred shares. This money can really help General Motors. Also, many people refer to Buicks as "old people cars." Well, Buick was aware of this and, in order to gain more customers, has recently changed the design of many of its cars. For instance, they have made the new Lacrosse and Lucerne as European-looking sports sedans. Now, which is more appealing to the average American family, an "old person's car" or a European-looking sports sedan? I'd go with the sedan. This change in design has additionally helped GM, Buick specifically, gain more publicity.
What do you think?
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I definitley agree that the U.S. auto industry is not dead. The numbers you listed are strong evidence of that. The flawed Toyota models distributed in the U.S. are also really helping American car makers. Toyota recalled 2.3 million vehicles built with faulty accelorators. This caused a 16% drop in Toyota's sales last month which in turn boosted the success of U.S. car makers. Last month, Ford saw a 24% increase in its sales, outselling Toyota for the first time in a while. GM also saw improvment, increasing its sales by 14%. Honda, perhaps the second most reputable Japanese car maker, made of a point of not following its American rivals in targeting Toyota customers. This may have been to noble, patriotic move, but Honda saw a 5% drop in sales this month. S&P analysts are predicting that Ford will see even larger gain because of Toyota's cripling product recall. I'd say the American car industry is showing serious potential for future successful.
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