Automotive industry continues a slow death

The Intellectual Redneck ^ | February 28, 2009 | The Intellectual Redneck

[Askwhy5times]

Automotive industry continues a slow death. J.D. Power and Associates Reports that U.S. Light-Vehicle Retail Sales in February are down by nearly 38% from one year ago. GM and Chrysler LLC are receiving TARP money from a government bailout. The suppliers for the US auto companies are not getting any assistance. Many are facing a tight cash flow that could force them into bankruptcy. They have high priced materials (like steel) in their supply chains. Many have significant inventories of goods. While car sales have declined 38%, demand for auto parts for some vehicles have declined even more. Almost every vehicle is now over the desired 60 day dealer inventory window. Very low sales and high priced materials in the supply chain may force many auto suppliers bankrupt. This could lead to a domino effect of prolonged auto manufacturing plant shutdowns. The Obama Administration needs to stimulate car sales this year. Unfortunately, there is nothing in the works that will accomplish that goal. Here is an AP video highlighting the difficulties of one auto parts supplier.

[Askwhy5times]

GM and Chrysler will both likely go bankrupt this year. The question is- will they take their suppliers with them or will the suppliers lead the way?

[alexander_busek]

GM and Chrysler will both likely go bankrupt this year.

If GM and Chrysler go bankrupt (thus taking their suppliers with them,) would Ford be far behind? Would that not in essence mean the end of the American auto industry? I doubt that the powers that be would allow that to happen.

Regards,

[screaminsunshine]

Maybe they should cut production and lay off EE’s til it picks back up.

[Bernard]

Going into Chapter 11 means that the company has a chance to get rid of bad deals, although the unions would fight that. Chapter 7 would be a complete dissolution of the company, and maybe somebody would buy some of the brand-names.

If the companies go into BK, and the unions continue to fight for wages and benefits. that will be a true demonstration of how to beat a dead horse.

And the American auto industry is not in as much trouble as the brand names headquartered in Detroit.

[Askwhy5times]

“Maybe they should cut production and lay off EE’s til it picks back up.”

They have. However, labor costs are often less than 10% of an auto parts price. The supplies have been forced to heavily automate to stay competitive. They still have to pay the bills even if they have no sales.

[screaminsunshine]

Then they are done for. They should just close til biz picks up.

[Son House]

American industry continues a slow death

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Soon to follow, thanks President Einstein

[Son House]

Next will be the tool manufacturers, a small sample;

American Measuring Tool Manufacturers Association

2008 AMTMA Member List

http://www.amtma.com/html/members.html

MAHR FEDERAL, INC., MARK - 10 CORPORATION, NORTH AMERICAN TOOL CORP., NIKON INSTRUMENTS, INC., OSBORN PRODUCTS, INC., PENNOYER-DODGE COMPANY, R.L. SCHMITT CO., INC., S-T INDUSTRIES, INC., SIZE CONTROL, A DIVISION OF KENNAMETAL IPG, THREAD CHECK, INC., THREADS, A DIVISION OF KENNAMETAL IPG, ULRICH METROLOGY, INC, VAN KEUREN, A DIVISION OF KENNAMETAL IPG,

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VAN KEUREN, A DIVISION OF KENNAMETAL IPG

DESCRIPTION OF PRODUCTS & SERVICES: Thread & gear wires, precision cylindrical plugs and rings, thread plugs and rings, optical flats and monochromatic lights. Calibration service.

VERMONT GAGE, DIV. VERMONT PRECISION TOOLS, INC.

DESCRIPTION OF PRODUCTS & SERVICES: Pin gages, Co-No/Go plug gages, plain ring gages, Thread plug and ring gage. Available in steel, chrome and carbide.

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Democrats and their President will have a lot of stupidity to account for as companies all across the board fail

[Venturer]

Democrats and their President will have a lot of stupidity to account for as companies all across the board fail

They will simply blame it on George Bush and thir sycophants will say “ That’s right”.

[2harddrive]

Soon, the Big 3 US automakers will be Ford, Honda, and Toyota!

[tsomer]

GM and Chrysler may not make it.

They need to get out from under their middle of the road status among drivers.

They need to spin off a subsidiary company to make expensive, exclusive range , snob appealing cars.

They still make Steinways in New York.

[PGalt]

They’re (government/industry/union/judges/propagandists) are already floating the new lexicon, “managed bankruptcy” (managed economy/life anyone?) where they offload much of the legacy costs on EVERY U.S. taxpayer. Some of hard-working retirees (with no voice) are in effect told to eat a crap sandwich and die. Then the government/industry/union/judges/propagandists/fascists/collectivists can emerge from this with happy faces, take some pictures, talk to each other, kiss some babies and do some greasy gladhanding before they move forward to their next scam.