The U.S. auto industry has had one heck of a year.Sales have fallen off, credit has been pretty much nonexistant and two of the major U.S. automakers were bankrupt. Other that all that, things were fine.But Bill Diehl, chief executive of advisory firm BBK, said at the first day of this year’s Reuters Autos Summit, that one of the main concerns for 2010 (if it’s not THE main concern) is the industry’s overall exposure to commercial real estate.We have been hearing about the problems with commercial real estate in many other sectors of the U.S. economy and Diehl gave the strongest statement so far about the auto side.(To hear Diehl\’s comments, please click here)The Reuters Autos Summit continues through Thursday in Detroit and Paris.
We’ve all heard discussions on what letter of the alphabet the economic recovery will look like. Will it be “V” shaped — as in, a sharp plummeting, followed by an equally sharp upswing? Or more “U” shaped — a downturn followed by a flat period before the recovery starts? Is the lightness we’re witnessing in the economy the mid-point in a more extended recovery process, mirroring the letter “W”? And heaven forbid, let’s not even think we might be stuck in an “L” shaped economy, with no near or medium-term hope of improvement.
Executives at this year’s Reuters Aerospace and Defense Summit almost uniformely said that finding critical, and rather immediate, value in mergers and acquisitions was especially important now in a climate of less money available for financing.
“I think it’s fair to say it will not be as deep a recession, if
it is a recession, as many people had feared not that long ago.
There certainly is not a black hole developing in the U.S. economy,” Cohen told the Reuters Investment Outlook Summit in New York.