May 24th, 2010 | 
Author: Auto Industry Turmoil – How Long Will It Last?
This year has been tough on the auto industry worldwide for the most part due to rising fuel prices. The North American automobile industry has been especially hit.
The biggest buzz seems to have sprung form the Meryl Lynch report and the idea that they couldn’t rule out bankruptcy for the world’s largest automobile manufacturer General Motors. At the same time the company’s stocks fell to a 54year low. And all of it ocurred at a time when GM reported uninspiring sales figures i.e. 265937 in June this year.
In order to avoid bankruptcy GM would need to raise 15 billion in cash as has been said. While the company hasn’t responded to the report but it thinks that it’s got enough cash for 2008 and that it would take the required measures if needed.
However it’s not just GM that took the hit Toyota’s sales also came down by over 21 while Ford’s figures showed a drop of 28.1. For the most part the mechanism seems to be the same that is lower demand for gasguzzlers owing to high fuel prices.
Meanwhile in Canada the trend has been replicated with the auto sales plummeting by 5.7 percent from last year to reach 159500 vehicles in June. The drop is significantly higher than the 0.5 percent fall in May.
So How Long is it going to last?
Predictions were made earlier as well wherein it was said that things could begin to look up for North America by 2009. However given the present trends some experts feel that for the North American auto industry revenues could decline in 2008 and 2009. And that we could see increasing losses as the yearend approaches.
To learn more about challenges before the auto industry worldwide and for other insights kindly visit my blog Automobile Hotspot.
About the writer: I am a journalist with 7 years of experience. Though as a professional I’ve reported on myriad topics my favorites remain to be the medical industry and the automobile industry. I blog at Automobile Hotspot.
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