Is nobody immune from the economic crisis? It’s abundantly clear now that it’s not just banks that are in trouble – automotive businesses are now falling like flies in these credit-straitened times.
Everyone from dealer groups such as Inchcape to car companies like Volvo are axing staff, while manufacturers including Nissan, Honda, Toyota, Bentley and Ford are idling factories, cutting shifts and generally trimming production to meet collapsing demand from markets around the world.You can’t even rely on booming sales in China any more.
That market has enjoyed double-digit growth for years, but analysts are now downgrading forecasts as demand flattens.
It’s now inevitable that the industrial road map of this industry will be redrawn in the coming months.
The world’s biggest carmaker, GM, is contemplating a merger with Chrysler. America’s Big Three could soon become two, and rumours abound of other carmakers on the endangered list.
Dinosaurs like Hummer and Viper are being sold in the great American fire sale.
There’s no room for passengers in the new world order and I’ve been predicting for some time that we’ll see casualties in this tough economic headwind.
We recently caught up with Carlos Ghosn, the talismanic leader of Renault-Nissan, to ask him for his thoughts on the crisis gripping the automotive sector.
He called the current economic plight the worst since 1929 and admitted it was the single biggest headache on the minds of executives in boardrooms across the world.
Ghosn admits he’s having a hard time predicting what the market will look like next month, let alone next year.
Right now, the very biggest businesses in this sector are focused on survival.
But the question on everyone’s lips is: who won’t make it through to the other side?