US car sales have been awful, running off as much as 30% recently. But, there is always China. It is big for McDonald’s (WMT), Wal-Mart (WMT), GE (GE), and Hewlett-Packard (HPQ). Everyone wins in China. So, why not GM (GM) and Ford (F)?
Too bad that car sales in China have turned rotten.
In the first part of 2008, vehicle sales in the world’s most populated country surged 20% compared with the year before. For the balance of the year they may be no better than flat. JD Power says that 2009 could be even worse.
Now that US car companies are threatened with extinction they had to hope they could sell investors on one last frontier of potentially huge growth. It looked like that would be in emerging countries, but the assumption is dying quickly.
The car market in China has not only flattened out. It has been such an attractive target the every major auto company in the world has poured in resources. And, the Chinese are putting together their own local operations to compete with all of those outsiders. The competition for the local consumer gets tougher by the year.
The "China miracle" is not something US car companies can brag about anymore.
Douglas A. McIntyre