American car industry creeps back
Is the economy recovering? That’s about as easy as predicting the weather a year from today. Fortunately, American industry has a pulse — barely. Chrysler Group CEO Sergio Marchionne announced today that it “intends to break even” this year, according to The Wall Street Journal. Marchionne also said that they are investing $5 billion in reinventing its lineup this fall, starting with a new model of Jeep this June, according to Bloomberg.
The American auto industry has finally come from hiding under its covers. Of the “big three” automakers in the U.S., Ford is the healthiest financially, reporting a $2.7 billion profit in FY2009. Chrysler, the smallest in terms of sales, barely escaped bankruptcy when Fiat SpA bought them. Only General Motors, still struggling under U.S. government ownership, remains in financial jeopardy.
The American auto industry still has a ways to go to fully recover. Less than half of the automakers’ industrial capacity is being used, according to the American Automobile Manufacturers Association (AIAM). Investors and consumers would brush over businesses not using half of their capacity. With the automobile industry and its anemic standards, this may be a good starting point.
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