A badly battered Detroit was doing its best to put on a bright smile for the nation’s premier auto show which opens today in the wake of one of the worst years in Motown’s history.
Hometown giants General Motors and Chrysler were forced to seek billions in government loans and finally bankruptcy protection in the wake of a collapse in auto sales amid a broad economic crisis.
And while Ford managed to both stay afloat and increase its share of the shrunken market, the Detroit Three were dethroned by Asian automakers last year as the biggest sellers in the US market.
“It was a year that nobody wants to repeat,” said Rebecca Lindland, an analyst at IHS Global Insight. “The one silver lining is that only two of our major car companies had to declare bankruptcy because, seriously, just looking at how the sales fell, it’s a miracle that more didn’t have to.”
Auto sales were down dramatically worldwide and in the US they fell 21.2 percent to 10.43 million vehicles last year, Autodata figures showed last week.
That was the lowest level since the 1983 recession and drastically below the between 15 million and 17 million vehicle range posted in each of the previous 15 years.
The collapse came as Detroit was smarting from years of mass layoffs and plant closures as GM, Ford and Chrysler restructured their operations in the wake of a decades-long loss of market share to Asian rivals that accelerated dramatically when high gasoline prices undermined truck and sport utility vehicle sales.
The Detroit Three — which held a 60 percent share of the US market as recently as 2004 and a 70 percent stake a decade ago — ended 2009 with a 44.2 percent stake. Asian automakers captured a 47.4 percent share last year, up from 44.6 percent in 2008, Autodata said.
Part of the loss comes from the fact that the Detroit Three are offering customers fewer options and focusing on “core” products.
GM is in the midst of shedding half its brands, Ford will have done the same after it completes the sale of Volvo, and Chrysler has dramatically cut back its offerings under the management of Italy’s Fiat.
All three automakers insist that the painful cuts have positioned them for long-term profitability and a congressional delegation will be visiting the show to see how those plans have translated into products.
“For the domestic brands, the objective is to really showcase that they are here to stay,” said Jeff Schuster, director of forecasting at JD Power.
There is no doubt that this year will be a challenging year. While most forecasters are forecasting a moderate rise in US auto sales, they are expected to remain at significantly depressed levels and could be badly hit should the economy take another bad turn.
“For 2010, I’m leaving my seatbelt on, because I think that volatility is still an element of the new norm,” Ken Czubay, Ford vice president for US marketing sales and service said in a conference call discussing Ford’s December sales results last week.
Yet the fact that the Detroit Three managed to survive the recent turmoil to mount displays highlighting their new focus on stylish and fuel-efficient vehicles has granted new hope to the Motor City.
“The mood is incredibly, diametrically, 180 degrees different than what it was a year ago,” said Doug Fox, chair of the North American International Auto Show.
“There’s some stability in the market. That has really heartened a lot of people that maybe we have hit the bottom,” he said.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS