From Forbes:
Detroit – If you want to know what impact the banking crisis is having on the overall American economy, look no further than automakers, who say they are facing “horrific” sales this month because customers can’t get credit–or are afraid to buy amid the uncertainty.
“It can be nothing but a disaster for consumer confidence when you’re talking about bank failures,” frets Earl Hesterberg, chief executive of Houston-based Group One Automotive, a large, publicly traded dealer group. “People are worried about where their bank deposits and CDs are. We’ve seen traffic suffer accordingly.”
Carmakers were already facing a tough year, amid a difficult housing market, higher gas prices and escalating commodity costs. But Wall Street’s high-profile collapse, and the related tightening of credit for all businesses, has made a difficult situation even worse–and stirred concern about whether carmakers have enough cash to weather the downturn.
Retail car sales were down 34% through the first three weeks of September, compared with the same period a year ago, and analysts are now lowering their forecasts based on the added factor of credit gridlock. On Wednesday, J.D. Power & Associates lowered its September sales forecast to an annualized rate of 12.6 million units, down 400,000 vehicles from what it had been predicting only a couple of weeks ago. Read the rest of the sad story here.
A lot of industries are going to be ruined through no fault of their own. Even the deepest pockets aren’t going to be able to hold out for very long.
The auto makers support auto workers, dealers, salesmen, mechanics, paint companies, parts makers, steel manufacturers, tire manufacturers….and that’s just a small part of whom the House and Senate are trying to/have screwed over with their failure to fix Fannie Mae and Freddie Mac years ago.
Many of them are unionized. And most of them are going to vote for the very people that proclaim to be for the worker who are trying to make fuel for automobiles so expensive that people cannot afford to drive anything but smallish imports. The same party that claims to support the American worker but blocks deporting illegals that will work for a third of their wages.
Oh, well, don’t forget the coal miners. Obama and company want to eliminate their jobs entirely. Perhaps they can learn to erect windmills.