We will not see 17 million sales again for a while, a good while. Just for a reminder, when sales fell to 12.3 million back in 1991, they didn’t march into boom time recovery for eight years, until 1999.
Let’s see, eight years from now would be 2016.
How bad will it get? Well, Detroit’s auto makers won’t have to worry about getting rid of dealers. They are all dying.
The trouble is that it’s not always the 150 cars-a-year dealer in Emptytown, ND, that go down. Sometimes it’s the big stores with the heavy investments that disappear, the suburban 1,000 cars-a-year dealers.
Mike Jackson, CEO of, the largest dealer group in the U.S., predicts retailer numbers – 20,770 at the start of the year – will drop by 1,000 over the next year. He adds the number shuttered could be in the thousands before the downturn is over.
The collapse seems to have brought on some kind of madness. The worst example is, which announced it is developing several different electric cars. Chrysler clearly is short of product money for new cars and engines. But instead of developing something practical, something that could sell, such as a sharp-looking high-mileage compact in the spirit of the Dodge Valiant, Duster or Neon, Chrysler is talking about stuffing batteries into some of its present vehicles.
Whatneeds, if it remains independent and is not absorbed by another auto maker, is to focus on offering a 4-cyl. engine that can push a sexy compact near 50 mpg (4.7 L/100 km), or a small turbodiesel that could deliver up to 70 mpg (3.3 L/100 km) in a small car.
Across town, betting heavily on the Chevrolet Volt makeslook like a gambler at the roulette wheel: He’s been losing all night so he pushes all his last chips on double zero.
Even if the Volt is a huge success, volume sales are years away. We all want the Volt to succeed, but what GM needs is a great compact it can sell today.
Let’s hope the upcoming Chevy Cruze is that car.
In the U.S., electric cars still are the stuff dreams are made of, not high-volume, short-term profit makers. Someday our children may drive them, but they are not the ticket to getting GM or Chrysler turned around.
seems to have its act together with cars like the new Fiesta, but we will have to see how quickly the new cars come out and how good they look.
Our government is willing to loan money to U.S. auto makers to help them with new fuel-saving technology. That’s wonderful, but money and technology alone won’t do the trick.
What Detroit needs now more than anything is a lineup of sophisticated and affordable small cars built to European standards that are better than U.S. car buyers have ever seen.
They are in the pipeline. The question remains whether they will be good enough and here soon enough to save the day.
Jerry Flint is a columnist for, and former senior editor of, Forbes magazine.