If their objective is to be the world’s shortest giant, 2009 was a good year for Ford:
Ford Motor Co. posted a 33% rise in December U.S. light-vehicle sales, ending a stellar year for the auto maker compared with its rivals. Ford recorded its first full-year market-share gain since 1995.
Meanwhile, Chrysler Group LLC posted a 3.7% decline compared with a year earlier and said its full-year sales were the worst the auto maker had seen in 47 years.
The largest U.S. auto maker—General Motors Co.—posted a 5.7% decline, but said its process to sell down Pontiac and Saturn inventory was ahead of schedule and reported a 2.2% increase for the four brands GM will keep after its streamlining.
Toyota’s sales rose a similar amount, Honda’s rose 24%, and Nissan’s 17%.
Does anyone else sense causality in the fact that the two auto companies that taxpayer money went to bail out were the two major auto companies that posted declines? Maybe the secret of a rebound for Chrysler and GM is for the federal government not to bail them out.
I’ve said it before and I’ll say it again: if we’re bound and determined to buy companies wouldn’t we be smarter to buy companies in growth industries rather than in an industry that’s as enormously over-built worldwide as the auto industry is?
“Does anyone else sense causality in the fact that the two auto companies that taxpayer money went to bail out were the two major auto companies that posted declines?”
The two that were having trouble got bailed out. The company that was doing better to begin with did not. Your causality is backwards. The bailouts, initiated under Bush, came at a time when markets were still pretty jumpy. At this point, I would not bail them out again.
Steve
Sorry, steve, I think you’ve got it wrong. As well as being a result of problems the bailouts have actually caused additional problems. First, they’ve enabled GM in particular to avoid the major reorganization that was necessary. GM has needed this for decades and it’s been able to put it off a year or so longer due to the bailouts. And the bailouts have shaken consumer confidence in the companies.
BTW, I don’t really give a damn whose policy it was. The bailouts, as I wrote at the time, were a bad policy a year ago and they’re an even worse policy now. As I also wrote back then one of the problems is that politicians won’t be able to resist doubling down and we can see evidence of that in the additional money given to GMAC recently.
I think a lot of people are thinking of GM as really being CM (Congressional Motors)…and no one like Congress.
All I know is my next car will be (for the first time in about 20 years) a Ford. Is it a rational response to the bailouts? Maybe not. But at least I can be sure that Ford primary interest is in suiting their products to the demands of their customers. GM, seemingly, hasn’t been about that for years.