One just needs t
o steal a look at the share prices of the top companies – even the Japanese thunderbirds – to understand that something is deeply and structurally wrong. From December 31, 2006, to August 21, 2008, the share price of Ford has fallen from $7.51 to $4.61. GM: $30.7 to $10.16. Even Toyota has plunged from $108.9 to $88.19. And Honda has moved from $31 to only $32.65. Clearly, investors are finally viewing the Japanese players’ investments into hybrids with quite critical viewpoints.
Today, the situation is such that the global auto industry, leave a few exceptions, is getting scythed because of this furious refusal to accept the fact that consumers can maddeningly settle for a lesser ‘quality’, yet more fuel-efficient product. While the huge US market fell a negative 4.5% in automobile production last year, Japan grew only a puny 1%, Austria fell down a negative 17%, Finland a negative 26%, Portugal by a negative 22.5%, South Africa by a negative 9%, Belgium by a negative 9%, France negative 4.8%, Malaysia negative 12.2%, Netherlands negative 13%, Taiwan negative 6.7%. Yes, China grew by 22% and India by 14.4%, but their growth story and even of others could only make the global production grow by 5.7%.
If the Americans are insane, then I have to admit that other global auto firms seem to be leading the pack of insanity in their quest to reinvent the fuel deal. In 2006, Ford Motors was the world’s largest loss making corporation. In 2007, General Motors was the world’s largest loss making corporation. If you think that Toyota – creditably at a very powerful position currently – can never attain that glorious stage of losses, do remember, a company like Ford, which had around $100 million profits in the first quarter of 2008 (Jan-March), got cannon-balled by a killing loss of $8.6 billion in the second quarter; and all because, as Bill Ford put it last week, “Literally overnight, people stopped buying trucks and big SUVs and started demanding fuel-efficient cars...” All it took Ford to get destroyed was a matter of three months! All it would now take the global auto industry to die would be the same..
o steal a look at the share prices of the top companies – even the Japanese thunderbirds – to understand that something is deeply and structurally wrong. From December 31, 2006, to August 21, 2008, the share price of Ford has fallen from $7.51 to $4.61. GM: $30.7 to $10.16. Even Toyota has plunged from $108.9 to $88.19. And Honda has moved from $31 to only $32.65. Clearly, investors are finally viewing the Japanese players’ investments into hybrids with quite critical viewpoints.Today, the situation is such that the global auto industry, leave a few exceptions, is getting scythed because of this furious refusal to accept the fact that consumers can maddeningly settle for a lesser ‘quality’, yet more fuel-efficient product. While the huge US market fell a negative 4.5% in automobile production last year, Japan grew only a puny 1%, Austria fell down a negative 17%, Finland a negative 26%, Portugal by a negative 22.5%, South Africa by a negative 9%, Belgium by a negative 9%, France negative 4.8%, Malaysia negative 12.2%, Netherlands negative 13%, Taiwan negative 6.7%. Yes, China grew by 22% and India by 14.4%, but their growth story and even of others could only make the global production grow by 5.7%.
If the Americans are insane, then I have to admit that other global auto firms seem to be leading the pack of insanity in their quest to reinvent the fuel deal. In 2006, Ford Motors was the world’s largest loss making corporation. In 2007, General Motors was the world’s largest loss making corporation. If you think that Toyota – creditably at a very powerful position currently – can never attain that glorious stage of losses, do remember, a company like Ford, which had around $100 million profits in the first quarter of 2008 (Jan-March), got cannon-balled by a killing loss of $8.6 billion in the second quarter; and all because, as Bill Ford put it last week, “Literally overnight, people stopped buying trucks and big SUVs and started demanding fuel-efficient cars...” All it took Ford to get destroyed was a matter of three months! All it would now take the global auto industry to die would be the same..
113 long years of uncertainty!!!
From cars to oil, the journey continues...
1895 : Karl Benz patented ‘Benz Patent Motorwagen’ was the first car ever. The vehicle was driven by a 950cc motor producing less then 1 horsepower. The German invention has changed the way people look at personal transport
1908 : The introduction of Ford T in the early 20th century has brought about a revolution, continuing till date. The car was the first mass produced vehicle that enabled the masses to go for their own set of four wheels.
1967 : The aftermath of the six day war between Israel and Egypt (Arab-Israel War), proved to be a significant escalator of oil prices. Several oil producing Arab nations threatened an embargo on Europe and the US. By 1973, the pressure started mounting and resulted in a crises type situation. Long car lines, for precious and non-existent gasoline, outside US gas stations became a common sight.
1980 : As the Iran-Iraq war broke out, the price per barrel crossed the $60 mark. With major oil producers engaged in war, there was a great instability in the global oil market. This was accompanied by price fluctuations and volatility.
From cars to oil, the journey continues...
1895 : Karl Benz patented ‘Benz Patent Motorwagen’ was the first car ever. The vehicle was driven by a 950cc motor producing less then 1 horsepower. The German invention has changed the way people look at personal transport
1908 : The introduction of Ford T in the early 20th century has brought about a revolution, continuing till date. The car was the first mass produced vehicle that enabled the masses to go for their own set of four wheels.
1967 : The aftermath of the six day war between Israel and Egypt (Arab-Israel War), proved to be a significant escalator of oil prices. Several oil producing Arab nations threatened an embargo on Europe and the US. By 1973, the pressure started mounting and resulted in a crises type situation. Long car lines, for precious and non-existent gasoline, outside US gas stations became a common sight.
1980 : As the Iran-Iraq war broke out, the price per barrel crossed the $60 mark. With major oil producers engaged in war, there was a great instability in the global oil market. This was accompanied by price fluctuations and volatility.
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