The Rise of Ford and the Wallowing of Toyota
2010 continues to witness the unwinding of economic forces that were years in the making. First the bad news... Toyota. In their attempt to surpass GM, Toyota sacrificed some of the process and quality control in sourcing from sub-contractors, leading to the recall that has devastated their sales this year.
In the first quarter this year, the NUMMI Toyota plant in California shut down. This plant was founded in 1984 as a joint venture between GM and Toyota Corp... remember the Geo Prism and the Toyota Corollas. Yep, they were the same car. It is interesting to note that of all of Toyota's assembly operations, NUMMI was the only one that had union labor. I was talking to a customer in Kentucky the other day, and he said they were already loading up the robots from the Toyota plant and shipping them back to Georgia.
Already several years into its drastic re-structuring, Ford's sales actually did creep past GM, boosted by the strong tailwind created by the Toyota recall. I think it also has helped them that they have spent the last several years working hard to build cars that people actually might want to buy.
In general, new vehicle sales are improving (compared with 2009) as the table below indicates.
Conclusions?
It looks like memories of the high gasoline prices from last year have not yet faded from people's minds if one looks at the increase in small, mid-size and cross-over vehicles as compared with SUVs. If the residential real estate market continues to thaw, and if the economy can build a recovery beyond current lackluster jobs growth, we may see the slow resumption of business... something towards a “new normal” (as car sales figures would seem to indicate) . And if the banks ever decide they are willing to loan money to OTR trucking companies, our sub-niche within the economy may also be able to more fully participate in the so-called recovery.
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