Auto Industry in 2009

Auto IndustryOngoing economic recession – unprecedented in our lifetimes – has hit every industry hard. Even the newspaper industry is shrinking. But Auto industry was the hardest hit among all. Analysts are alive to the situation and are continuously giving opinions and points of view; some encouraging and some not very encouraging.

Auto industry has seen exponential growth since 1769. Fuel gas-powered internal combustion engines first appeared in 1806, while 1885 marked the introduction of gasoline-fuelled internal combustion engines. Automotive history is generally divided into a number of eras based on the major design and technology shifts. All along the industry has seen matching demand. That was one of the basic factors for the growth in the industry. But the near future seems grim.
The outlook for 2009 followed a traumatic year for the auto industry. U.S sales fell 13.2 million in 2008, down 18 percent from 16.1 million in 2007, with much of the losses piling up late in the year because of the financial crisis and credit crunch. In December, U.S. sales tumbled 36 percent.

The Society of Automotive Analysts conference predicted a few encouraging signs that would indicate a short-term turnaround. One analyst noted that U.S. auto sales would fall about 13 percent to 11.5 million units in 2009, hurt by high unemployment, low consumer confidence and mounting consumer debt and another say that U.S. auto sales would decline to 11.4 million units in 2009, followed by some growth to 13.4 million units in 2010 and 14.7 million units in 2011.

But people still have to drive vehicle. The Industry eventually will have to come out of this situation. When? Only time will tell.

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