Automakers fear bleak 2009 as demand plunges
Written on October 24, 2008
Daimler (DAIGn.DE: Quote, Profile, Research, Stock Buzz), Hyundai Motor (005380.KS: Quote, Profile, Research, Stock Buzz) and Fiat (FIA.MI: Quote, Profile, Research, Stock Buzz) added to the gloom facing the autos sector with bleak forecasts for next year, as the global financial crisis took its toll.
The news from Europe and Asia came as Daimler’s U.S. affiliate, Chrysler, cut a shift at a Toledo plant and brought forward the closure of its Newark (Delaware) operation.
Germany’s Daimler, maker of Mercedes-Benz luxury cars and heavy trucks, lowered its expectations for the year, adding that all of its forecasts had a high degree of uncertainty to them.
Italy’s Fiat said global demand for its products could drop 10-20 percent and its profit tumble by as much as 65 percent in a “worst-case” scenario cash advance now.
At Hyundai, South Korea’s top car maker, a senior official expected demand in emerging markets to fall next year. [nN22405189]
Global car makers face a sharp drop in sales as drivers put off major purchases on fears of a recession and the cost — if not the lack — of getting loans.
The market had expected their outlooks to be bad but they did not know how bad until Thursday when the first batch of results from the sector came out.
At 1029 GMT, the DJ Stoxx European auto index fell 6.31 percent, while the wider market was little changed. Fiat shares were briefly suspended twice for excessive losses.
Filed in: legal.