The Big Three Are Not AloneNovember 30, 2008 - by Donny Shaw
Tomorrow is the deadline for GM, Chrysler and Ford to submit their revised plans to Congress explaining how, exactly, a $25 billion bailout is going to help them be financially viable going forward. We’ll be reporting on that as information is made available.
In the meantime, here’s some news out of Japan that should give the companies a boost going into their next round of negotiations with Congress:
> Toyota Motor Corp. and Nissan Motor Co. led the biggest drop Japan’s auto sales in 34 years as the country’s recession cut wages.
>Sales of cars, trucks and buses, excluding minicars, fell 27 percent to 215,783 vehicles in November, the Tokyo-based Japan Automobile Dealers Association said in a statement today. Toyota Motor Corp., Japan’s largest automaker, sold 106,342 vehicles excluding the Lexus brand, down 28 percent. Sales at Nissan Motor Co., the country’s third-biggest, fell 30 percent to 30,134.
>Honda’s sales dropped 22 percent to 29,448 vehicles last month. Mazda Motor Corp.’s fell 33 percent to 9,699 vehicles.
The point here is that auto sales are falling significantly throughout the entire market. The decline among these stronger, foreign brands are comparable to what the Detroit companies are expected to report this week (GM -28%, Ford -33%, Chrysler -42%), and the numbers should help convince Congress that the Big Three’s troubles are a result of the financial crisis, not poor management. If they can make that case, it should be a lot easier for skeptical lawmakers, who are concerned that the companies lack plans for improvement, to approve $25 billion to tide them over until the economy picks up.