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The End for Detroit's Big Three
The Daily Auto Insider
Monday, September 18, 2006
September 2006


Ford and DaimlerChrysler AG's Chrysler Group acknowledged that their strategies for becoming profitable have “hit the wall,” The Wall Street Journal reported.

DaimlerChrysler said its Chrysler Group is on track to lose about $1.5 billion in the third quarter — more than double prior forecasts, and Ford said its core North American auto business won't return to profitability before 2009.

Taken together with GM's moves to cut costs and reform itself, the downsizings and management upheavals “point to a new order in what remains one of the most important industries in the U.S. economy,” the WSJ said, adding that the concept of a U.S. Big Three — GM, Ford and Chrysler — is obsolete (Toyota has pulled ahead of Chrysler by 200,000 vehicles in U.S. sales through August, and in July even outsold Ford).

In contrast to the dire straits facing Detroit, Toyota, now the world's No. 2 automaker, plans to boost overseas production by 40% of its 2005 level to 5 million vehicles by 2008, Japan's Nihon Keizai newspaper reported.

Toyota intends to increase production in North America, the world's largest auto market, by 20% to 1.84 million vehicles in that period, the business newspaper reported, and also expects to raise production for the first time above 1 million vehicles in Asia, excluding Japan and China.

Domestic production is seen rising to 4.15 million vehicles by 2008, bringing Toyota's global output to 9.1 million, Nihon Keizai added.