Automakers are facing what is only the second down market since the end of the Great Recession and the record sales that followed. How far down demand will go this time is a matter of debate, with analysts and planners warning that could depend on how the Trump administration handles disputes with China and other trade partners.
Ford echoed that approach in a statement, citing "long-standing practice of matching production with consumer demand" for its decision to curb operations at its Oakville, Ontario plant next month. The factory produces four SUVs -- the Ford Flex, Ford Edge, Lincoln MKT and Lincoln Nautilus models. About 200 workers will be idled, and Ford cautioned further cuts could follow.
Across the industry, the biggest cuts have focused on the passenger car side of the market. GM, for one, announced last November plans to close three North American assembly plants, while dropping an array of sedans including the Chevrolet Cruze and Impala, as well as the Cadillac CT6. The automaker's plant in Lordstown, Ohio has already been shuttered but one in Detroit is now scheduled to operate through at least early 2019.
Complicating matters, "While people are talking about fabulous SUV sales, the market is getting saturated with them and inventories are building while incentives are growing," said Michelle Krebs, executive analyst with Autotrader.com. But "this is an industry that remembers quite vividly what happened a decade ago," said Stephanie Brinley, principal analyst with IHS Markit. Leading into the Great Recession, they kept ratcheting up the givebacks "to keep their plants running and production up. But they found there was a point where that eroded profitability to a point that couldn't be sustained."
Drop the interest rates, & people will buy more cars. It’s not rocket science.
The economy is slowing primarily because of Trump’s stupid trade war with China! If it continues it may cause a global recession! Trump is a moron!
PMOIndia FinMinIndia Why is auto sector a priority-why cannot this be a big opportunity to move to electric vehicles & cycles-this will be reset road crazy development,better airquality,save forest trees &save previous forex to the country- we must let some death of this sector
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Source: Reuters - 🏆 2. / 97 Read more »