Magazine article Economic Trends

The U.S. Auto Industry

Magazine article Economic Trends

The U.S. Auto Industry

Article excerpt

02.23.09

[GRAPHIC OMITTED]

[GRAPHIC OMITTED]

Much has been made about the difficulties the auto industry has faced this year. Ford, GM, and Chrysler have struggled for some time, but last fall their situations dramatically worsened. After the auto manufacturers pleaded their cases in December, Congress agreed to extend loans to Chrysler and GM in order to help keep the two companies alive.

One big reason they needed the funds, the automakers argued, was the economic downturn and its effect on their sales. With sales data for 2008 available, we can see to some degree what the auto companies were talking about. Total light vehicle sales declined 18.0 percent in 2008, as sales for both cars and light trucks (which include SUVs) declined over the year. That now makes three consecutive years in which light vehicle sales have declined, after declines of roughly 2.5 percent in both 2006 and 2007.

Sales at Ford, GM, and Chrysler (the big three) have been declining steadily since 2000. These three automakers were especially hurt in 2008 when sales declined nearly 25 percent. The three major Japanese automakers have also been affected by the current economic downturn. Their sales declined a combined 12.3 percent in 2008, breaking a trend of steady sales growth.

As sales have declined, Ford, GM, and Chrysler have cut their U.S.-based production in an attempt to adjust to the decreased demand for their vehicles. Production data for 2008 has not yet been released, but it's a pretty safe bet to assume that production declined during the year, as in recent years. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.