By Jennifer Yousfi
Automakers are expected to post the worst results in the past nine years as even foreign giants Toyota Motor Corp. (TM), Nissan Motor Co. Ltd. (NSANY) and Honda Motor Co. Ltd. (HMC) are all expected to have declining sales year-over-year for the month of December. And the outlook for 2008 isn't much better.
"When the consumer gets squeezed, he gets squeezed in all areas and that will include car and truck sales," Pete Hastings, a fixed-income analyst at Memphis, Tennessee-based Morgan Keegan & Co. told Bloomberg News. "It's going to be a brutal year for autos, we're headed into a recession."
Detroit's big three fared even worst. The big loser was Ford Motor Co. (F), where December sales declined by 9.2%, capped off a bad year. Sales declined 12% for 2007.
"We are restructuring our business to be profitable at lower demand and changed mix and accelerating the development of new products people want to buy," Jim Farley, Ford's group vice president, Marketing and Communications said. "We have more work to do to reach our ultimate goal – profitable growth for all. But we have made progress in a short amount of time in several key areas."
Ford is looking to sell its Jaguar and Land Rover units and recently
General Motors Corp. (GM) sales are expected to drop 5.6% for December, causing the Dow Jones Industrial Average component's share price to reach its lowest point in the past year and a half ahead of the official sales release.
Chrysler LLC sales are expected to drop 7.9% for December. The privately held automaker, bought by private equity firm Cerberus Capital Management, LP in 2007, cut over 1,000 jobs at its St. Louis-based factory yesterday (Thursday) and expects to lay off another 8,000 to 10,000 hourly workers before March.
"Given the current economic challenges and the uncertainty associated with the upcoming presidential election, we do not anticipate that 2008 will be any more robust for the car business," Jesse Toprak, Edmunds.com analyst, told MarketWatch.
News and Related Story Links:
Auto makers expected to detail rough year for sales
- Bloomberg News:
Ford Motor's December U.S. Auto Sales Declined 9.2%