The post-apocalyptic analysis of December’s sales results continues, as pundits and producers attempt to make sense of the crater that’s replaced the U.S. new car market. Obviously, the situation will have the greatest impact on the Chrysler and GM. The domestic automakers have just finished their first suckle on Uncle Sugar’s taxpayer teat, with GM auguring-in for its second go mid-month. And both companies face a congressional grilling when they return for more money in March. So, what to do? What to do? For answers to that question, for the manufacturers’ spin, we turn to their unofficial mouthpiece, The Detroit News. “Auto sales skid: Recovery rests on stimulus” starts with good news! “After barely making it through the worst year for auto sales since 1992, Detroit’s Big Three expect consumer demand to remain very weak in the first half of 2009 but begin to recover in the second half.” I’d like to point out that a general “sales” recovery does not necessarily mean Chrysler or GM’s recovery. But that would kind of ruin the flow, if you know what I mean. To wit…
“Auto executives on Monday said they were pinning their hopes on President-elect Barack Obama’s plan to introduce a massive stimulus package to revive the flagging economy and encourage consumers to start spending.”
Meanwhile, how’s GM doing with that grieving process? Not so well…
“‘We have a lot of challenges out there with the economy,’ said Mike DiGiovanni, GM’s executive director of global market analysis. ‘We are in a recession.’ But, he added, ‘we are optimistic as the Obama administration comes in given that it’s the first new administration in eight years and is likely to be a honeymoon period. There is going to be lot of excitement generated across the country because of the change. People like that.'”
So, do they believe this shit? It’s just spin, right?
“Looking at 2009, Mark LaNeve, GM’s vice president of sales for North America, said: ‘We’re optimistic that it’ll be a year that’ll gradually improve.’
The automaker expects to benefit from the launch next year of six important models, including the Buick LaCrosse sedan, the new Camaro and a new Chevrolet Equinox crossover.”
LaNeve. I mean, he has to say stuff like that, right? Nope.
“But [Ed: note the but] Japan’s automakers also are finding themselves in unfamiliar territory in this downturn. With the recent drop in gas prices, demand for their small cars has fallen along with truck sales. Toyota and Honda Motor Co. have cut production and said they are now losing money.
‘We have no illusions about the coming year,’ [Toyota NA Prez Jim] Lentz said. ‘It may get worse before it gets better.'”
Why are they going to all this trouble? Just print enough money to give everyone a million dollars then nobody will need to work.
I read in today’s local paper that, under President-elect Obama’s proposed plan, couples will receive a $1,000 tax break. But it won’t be received in the form of a $1,000 check – it will come through reduced payroll taxes, meaning that taxpayers will see smaller deductions throughout the year.
Whether that will stimulate the economy remains to be seen, but that is not going to spur us to buy a new vehicle. But then, neither would a check for $1,000. And even if we were going to buy a new vehicle, it wouldn’t be a GM or Chrysler product.
So, from our corner, both companies are still out of luck.
The Democratic promise: “A chicken in every pot and a Buick in every garage.”
Of course, the chicken has doubled in price because farm subsidies have eliminated market competition. On the other hand, the Buick has halved in price because the focus has shifted from making profit and is now on selling cars to inflate the numbers in order to make a case for more federal funding.
I hope the majority of us are starting to see how an intrusive government makes the world so backward.
I just hope that the Canadian government at some point stops “matching” the “investments” and “loans” made by the US government for this bunch of loosers. But it’s not going to happen…
BTW Robert, is this “Bailout Watch 320” 2.0? What happened to the original post with that number and the proposed boycott? I think I missed something in the last couple of days…
bluecon:
Why $1M? Most of us can get by fine on $100k.
Ooh, ooh … press release:
“RetardedSparks cuts government spending 90% on first day in office!”
Subaru is still doing pretty damn well, all things considered.
How come nobody mentions it?
…aaaaaand now there’s a post about it.
It’s going to take a few years for the economy to recover any way you look at it…this seems all to familar to when Clinton took office from the Reagan/Bush years – economy in the toilet, and that took years to straighten out.
The time it will take for the economy to recover will be the death of the Detroit three anyway you try to spin it. Let them file bankruptcy and start over – no more bailouts (none should have been given in the first place IMHO).
Orian: Methinks you assign way too much credit/blame on specific administrations for economic conditions. Nonetheless, I believe the Reagan administration inherited a gargantuan crater of an economy from Mr. Carter in 1981. It would seem difficult to criticize the economy’s performance on his watch.
That said, the domestics either reorganize under Chapter 11 protections, liquidate under Chapter 7, or survive on a perpetual allowance from Uncle Sam. There are no other possible outcomes. Bridge loans (bailouts) will not alter this reality.
Man,
do we hate an intrusive government.
Love, Ken Lay and Bernie Madoff
If Barack Obama is The One, does that make George Bush The Zero, or The Negative One?