AutoIndustry

Automobile manufacturers and dealers spent $7.5 billion on advertising during the first six months of 2009, says TNS Media Intelligence. The company that keeps track of nearly every form of advertising for all industries is reporting that the figure represents a 30.8% drop compared to the same period last year, when it was $10.8 billion in spending. Not surprisingly, the plummet nearly mirrors the decline in motor vehicle sales (which dropped 27.4% during the exact same period).

Before we begin, let us state clearly that this is speculation by Karl Denninger at The Market Ticker. Examining the various stakeholders' interests in General Motors, Denninger has come up with a scenario that supposes GM's bondholders might actually want the automaker to file for bankruptcy.

According to The Detroit News, Avtovaz, Russia's largest car maker and the home of Lada, is in line for government help. The Russian car industry is faring even more poorly than its counterpart in the U.S., with a 60% drop in sales being predicted. To assist Avtovaz with payments to creditors, a lifeline of more than 20 billion rubles is being discussed (upwards of $588 million USD), which would be close to Avtovaz's total debt to suppliers and banks.

If we were cynics, we could say that Ford just happened to get stuck in deep doo-doo when America's credit markets were still reasonably flexible. When Ford leveraged all of its assets, right down to its logo, the most difficult part was probably not getting the money, it was probably swallowing its Blue Oval pride. Yet cynics or not, a CEO has to know what to do with said money, and Alan Mulally feels he and his company have done well enough to proclaim "We are competitive now" in a new interview with The Detroit News.

While there are folks predicting a turnaround in car sales and general economic fortunes by the end of this year, for now the status quo remains, and it can be summed up as: "Ouch." J.D. Power has put the early returns for March sales down 40% compared to the same month last year. It predicts sales of 633,000 cars to retail customers and another 165,000 to fleet customers for March of this year versus a March 2008 total of 1.07 million total sales. That would be an annualized rate of 9.2 million vehicles.

Nicole Pentis is a high school junior in Bloomfield Hills, Michigan who has been making videos for five years. When C-SPAN sent out a call for students to make a video address to President Obama and tell him what they thought were the most pressing issues facing the U.S., Pentis grabbed her camera. Her subject: the turmoil in her own home - the imploding auto industry.

In her eight-minute vid entitled "Auto Industry for America's Past, Present, and Future," Pentis lists the numbers and makes her case for what the auto industry means for America, and uses a history lesson and interviews with several industry workers to back it up. Admittedly, the numbers she uses are debatable, but it can't be argued that the vid is heartfelt. Click the link to have a watch.

The European Union made noises last year about having the WTO verify that the U.S. auto industry assistance package doesn't violate any international trade rules. Now French President Nicolas Sarkozy has said he will ask the World Trade Organization to stick their hands into the matter.

Back in November, a New York Times columnist thought it would be a good idea for Apple CEO Steve Jobs to come to the auto industry's rescue. Jobs is worshiped by many in the tech world, and many feel that he pretty much saved Apple in the 1990s. But thinking that a brilliant tech guy can right the ship at struggling automakers could possibly be called a stretch. Well, Spark Capital founder Todd Dagres doesn't think so, as evidenced by his recent open letter to President Barack Obama.

In light of the automaker benefits and car buyer assistance in the recently-passed stimulus package, analysts at R. L. Polk & Co. estimate there will be an average rebate of $330 for every vehicle sold this year. By allowing buyers to deduct the sales tax from a new vehicle purchase from their income taxes, Polks sees a sales increase of 94,000 units this year.

When the U.S. domestic auto industry asked its government for billions of dollars in loans, it made world-wide news. Many other foreign nations have pitched in with funding for their own industries, as well. The UK has just gotten in on the act by promising £2.3 billion for the cause, with £1 billion in direct government loans and another £1.3 billion from the European Investment Bank. The UK government is promising its citizens that the loans are "no blank check" for the ailing industry. Hmm.. where have we heard that before? The British government deemed its auto industry worth saving, mentioning that up to one million citizens count on auto jobs for income. Similar to the U.S. loan deal, the British government is looking to develop a national strategy for greener, cleaner motoring.