The other shoe begins to drop

Bloomberg reports:

Chrysler LLC, awaiting a federal rescue as its cash dwindles, will shut all 30 of its plants for at least a month starting Dec. 19 as unsold cars and trucks pile up at showrooms.

Ford Motor Co. said it will idle most of its North American assembly plants for the first week of January, while General Motors Corp. said a new factory making engines for the Chevrolet Volt electric car is being delayed to conserve cash.

The cutbacks showed how far automakers are going to save money and prune output in a year in which industrywide U.S. sales are poised to fall to their lowest levels since 1991. GM and Chrysler say they may run out of operating funds in just weeks without emergency U.S. aid.

Originally published at Econbrowser and reproduced here with the author’s permission.

One Response to "The other shoe begins to drop"

  1. Guest   December 19, 2008 at 4:00 pm

    Do car manufacturers really think that without the availability of the home ATM $30k to $40k is a realistic price for an average car and $20k to $30k makes sense for an econobox? Then there is the thought of haggling with the car salesperson. Forget it. The auto purchase model is broken, from the price to the process.