General Motors and Toyota both announced 2008 vehicle sales this week. General Motors said vehicle sales dropped 11% in 2008, with a 21% drop in North America and a 6.5% drop in Europe. Toyota saw its global sales drop about 5%. Distributors are feeling the ripple effect from automotive supplier customers far, wide and deep.
Automotive supplier musical chairs is in full effect from a distribution perspective. If your customer plant is still running, it might even be increasing production as work is shifted from other operations, now shut down.
As some automotive suppliers struggle and go under, some distributors are seeing tooling and production work shifted to other suppliers, again with some increase in business on that end. But the good news in January is slim, as many plants were shuttered most of the month.
The latest numbers on 2008 North American Vehicle Production, by Wards Automotive Group (www.wardsauto.com), show that both the U.S. and Canada total vehicle production dropped 19% from 2007 (cars, light trucks and medium/heavy trucks). Mexico total vehicle production increased 4%, with car production up 1.6%, and light trucks up 9%.
Overall North American Vehicle production was down 16%, with Ward’s estimate of 12.9 million vehicles produced, down from 15.4 million in 2007.
MDM recently featured an article on how distributors and manufacturers who supply the auto industry are faring. Read that article: Distributors Weather Auto Turmoil“
