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The color of the “motor vehicles and parts” line is too close to the color of the border?
Where were the strike years?
I’d guess oversupply has been a chronic problem for some decades.
And I guess recessions doesn’t come out of the blue, but in a steady pace of ups and downs. The credit crunch should have been taken into account long before it happened.
Whats up with that big dip around 1999-2000 (fllowed by the sharp rebound)? Those were good economic times.
What’s Wrong With This Picture?
Um… it starts in 1948? One starting in 1928 would be more relevant.
This is very ugly. In the industry, anything below 80% capacity utilization is considered bad. This is horrendous. What are these, U.S. or worldwide data? Last I heard, worldwide utilization was a bit above 50%.
What is wrong? That the capacity is here, A lot has to go. Keeping it on life support is suicide.
How was it possible for the industry to exceed 100% of capacity in some years?
@KixStart: summer 1998 for the big GM strike, that roughly corresponds to a dip in the middle of nowhere
@Srynerson: Overtime. 100% utilization is probably calculated as 40 or 80 hours per week uptime (one or two shifts), but a plant is theoretically available 168 hours every week.
Nothing looks wrong with it. It shows that we are presently in a recession that mimics that of 1981-93. We are at a bit lower utilization rate because there is likely more capacity now.
Actually I think that the color blue is all wrong for this chart. And the text has to be in Times New Roman, not Arial. Oh, sorry, though I was producing another crucial PowerPoint slide for my Commander.
“How was it possible for the industry to exceed 100% of capacity in some years?”
Probably overtime, skipping equipment maintenance, skipping holidays and that sort of thing. Typically the capacity number is for whatever is defined as normal operations. In boom times a factory can be pushed beyond nominal capacity. Many plants don’t normally operate on weekends, for example. But when the business is there and double time pay is offered, fire it up!
Thank you, dkulmacz and John Horner. I was incorrectly assuming “100% capacity” would be defined as the maximum volume of vehicles it was physically possible run off the line.
dolorean23 :
June 18th, 2009 at 5:11 pm
Actually I think that the color blue is all wrong for this chart. And the text has to be in Times New Roman, not Arial. Oh, sorry, though I was producing another crucial PowerPoint slide for my Commander.
TIMES NEW ROMAN! My God man! What are you thinking? It must be in Arial 11pt font though Arial, 12, is acceptable.
It looks like there is a slow downward trend. And capacity utilization has never been this low in the post-war era.
@Bertel Schmitt:
Colour me confused. Given that anything below 80% is considered bad, and that blue squiggle seems to be below the 80% mark about half the time (even ignoring the last few years)… Isn’t the logical conclusion that the auto industry as a whole was never in a “good” condition? Ever?
There doesn’t seem to be many five-year intervals where the total utilized capacity is above 80% more than it’s below it.
That there are no pie and bar graphs in a proper PowerPoint presentation in a conferance room at the Holiday Inn.
If you scrape out half of today’s auto production capacity, you’d approximate the level that the rest of industry is experiencing today.
Dealer culling looks like peanuts compared to the culling that needs to happen at the factory level.
And 200-600 day inventory on so many models means GM and C ought not to restart until the end of 2009. Or later.