Keshavan 7/20 (Meghana, "Survey: Optimistic auto industry execs plan hiring, expansions in coming year," 7/20/12, Crain's Detroit Business, http://www.crainsdetroit.com/article/20120720/FREE/120729992#) CS
Automakers and suppliers are expected to hire more people and expand their plants in the next year to keep up with growing demands for U.S. light vehicles, according to a report released today by KPMG LLP, an audit, tax and advisory firm. Executives for the auto industry and suppliers, surveyed in May, said they are optimistic about continued revenue growth, despite concerns such as pricing pressures, a lack of a strong domestic skilled labor force and sales declines in Europe. "The survey results clearly demonstrate a U.S. automotive industry that is regaining confidence," said Gary Silberg, national automotive industry leader for KPMG LLP, in a statement. "Even though the overall economic recovery remains weak, that is not the case in automotive, where pent-up demand for vehicles in the U.S. is expected to carry over for years." According to June reports, U.S. auto sales rose 20 percent, reaching an estimate of 14.1 million for the year, up from 12.8 million in 2011. He said this is causing auto companies and suppliers to ramp up hiring and production, and invest in new products and facility expansion. "Revenues are higher and execs feel confident that revenues will grow stronger still," Silberg said. The survey results The 2012 KPMG Automotive Industry Outlook Survey, which was conducted in May, reflects the responses of 100 U.S. automotive executives. Findings include: Two-thirds of companies have added personnel over the past year, and 72 percent say their companies will continue to hire U.S. employees – up from 62 percent in last year's survey. When asked to predict when their company's U.S. headcount would return to pre-recession levels, about one-third said they already have rebounded to that level, or will by the end of 2012. About two thirds said that their companies have a significant amount of money on their balance sheets, and will invest that cash before the end of the year. About 73 percent will increase capital spending over the next year, with the highest priority being in developing new products or services, or expanding facilities. Nearly half – 47 percent – of the surveyed executives said their company is likely to be involved in a merger or acquisition as a buyer, whereas 10 percent said they'd be sellers. Key drivers behind this activity will be access to new markets and customers, and access to new technologies and products.
Huffington Post 7/9 ("Ford, GM and Volkswagen Top List Of Fortune's List Of World's Most Profitable Companies," 7/9/12 http://www.huffingtonpost.com/2012/07/09/ford-gm-volkswagen-fortune-profitable-companies_n_1659939.html)
Things are looking up for the auto industry: Just three years after the car industry's future seemed bleak and unredeemable, signs of a comeback are all around. Fortune's Global 500 ranking, released on Monday, listed three automakers among the world's most profitable companies. Volkswagen and Ford landed in the 13th and 14th spots, respectively, with General Motors ranked as 48th. This is the first time in at least a decade that more than one carmaker made the top 50 list. This stands in stark contrast to the situation in 2008 and 2009, when the global car market crashed. For a time, before Congress voted to extend aid to the industry, it seemed as if General Motors and Chrysler might fail and disappear. The two companies ended up with government-led bankruptcies, emerging with billions in government aid, as well as fewer workers, health care obligations and manufacturing sites.
Bloomberg News 7/3 ("Auto Sales In June Provided Bright Spot For U.S. Economy," 7/3/12, http://www.bloomberg.com/news/2012-07-03/auto-sales-in-june-provided-bright-spot-for-u-s-economy.html)
The U.S. auto industry shrugged off a weakening labor market and waning consumer confidence in June, surpassing analysts’ estimates and completing the best first half for vehicle sales since 2008. General Motors Co. (GM), Ford Motor Co. and Chrysler Group LLC reported better than predicted gains from the year-earlier period in which they dominated the U.S. market because of vehicle shortages at Toyota (7203) Motor Corp. and Honda Motor Co. caused by Japan’s tsunami. The 22 percent June increase for the industry gives reason for optimism after analysts under- estimated demand following lower than projected sales in May. Enlarge image A GM Buick Verano moves along the production line at company's assembly plant in Lake Orion, Michigan. Photographer: Jeff Kowalsky/Bloomberg Enlarge image The U.S. auto industry has continued a steady recovery since 2009 when GM and Chrysler restructured in government-backed bankruptcies. The industry is adding back workers to meet demand, with light-vehicle sales this year on track to reach 14.3 million, the average of 16 analysts’ estimates, a 38 percent gain from 2009’s 10.4 million. Photographer: Daniel Acker/Bloomberg Light-vehicle sales accelerated to 14.1 million seasonally adjusted annualized rate, according to researcher Autodata Corp., beating the 13.8 million light-vehicle average of 15 analyst estimates surveyed by Bloomberg. The world’s second- largest auto market remains on pace for the best annual sales total since 2007. “The auto market continues to be the one bright spot in an otherwise complicated and generally negative marketplace,” Jesse Toprak, an analyst at researcher TrueCar.com, said in a telephone interview. “The industry was able to carry a more than 14 million selling rate despite the roller-coaster ride we experienced in the economy and financial markets last month.” Beating Estimates GM sales climbed 16 percent in June, beating the 7.6 percent increase that was the average estimate of 11 analysts surveyed by Bloomberg. Deliveries rose 20 percent for Chrysler and 7.1 percent for Ford, topping analysts’ average estimates for gains of 18 percent and 3.7 percent, respectively. Nissan Motor Co. (7201) sales rose 28 percent, exceeding the 21 percent average estimate. Along with holiday marketing and discounted sales to fleet customers, U.S. automakers had success with some car models. Chevrolet Malibu sales rose 32 percent from the previous June, while Ford Fusion sales increase 17 percent, putting both midsize sedans among the industry’s top 10 models for the month. While Toyota and Honda fell short of analysts’ estimates, they led the industry’s gains in June. Toyota’s deliveries increased 60 percent, and Honda’s rose 49 percent, compared with projections for 66 percent and 51 percent gains. Toyota Camry sales rose 50 percent, while Honda Accord deliveries soared 84 percent and Civic sales jumped 57 percent. The U.S. auto industry has continued a steady recovery since 2009 when GM and Chrysler restructured in government- backed bankruptcies. The industry is adding back workers to meet demand, with light-vehicle sales this year on track to reach 14.3 million, the average of 16 analysts’ estimates, a 38 percent gain from 2009’s 10.4 million. It would be the industry’s third year of at least 10 percent sales increases, which hasn’t happened since 1971 to 1973.