BusinessWeek's Michael Mandel paints a grim picture of present prospects for the auto industry, specifically, a possible end to the automotive boom of recent years. A confluence of higher interest rates and rising gasoline prices threatens to weaken demand for cars at a time when companies' producion capacity is through the roof (GM just announced staffing cuts today). Moreover, once a bright light defying the US industrial trade deficit with their strong export base, US automakers will soon be forced to contend with China's entry in the market. The words Mandel used to describe one possible outcome were "stunningly nasty crash" a pun, we suspect, he intended.
Pop! Goes the Auto Bubble [BusinessWeek]