Will the auto industry turbocharge Michigan's economy this year?

| Monday, January 11, 2010
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I'm skipping this week's media preview of the Detroit auto show for a couple of reasons: One, I don't have to be there. And two, I'm using a wheelchair to get around these days. Navigating this expansive, kinetic show is enough to bring even able-bodied journalists to their knees.

I've covered just about every Detroit show over the past 20-plus years, including the 1989 event that debuted the North American International Auto Show and brought 850 journalists to town for the media previews. (I recall that bottles of cold Heineken beer were served in the media room that year, but, sad to say, the room has gone alcohol-free since.)

Originally begun in 1907 as a way of ginning up interest in this new contraption called the automobile, the Detroit show has become a mid-January extravaganza in which, for a couple of weeks, automakers try to dazzle journalists and the public into believing this is the year when the wheels of fortune will be rolling their way.

2010 certainly looks to be a vast improvement over 2009 for the automakers who call Michigan home.

Ford Motor Co., the only Detroit automaker that didn't file for Chapter 11 bankruptcy last year, is crowing this morning because the Ford Fusion Hybrid and Ford Connect delivery truck won the North American Car and Truck of the Year awards.

General Motors Co. has new management and lots of attractive products. Chrysler Group LLC has, uh, new management. All three automakers might turn profitable this year after years of losses.

Sales also are expected to improve. Just 10.4 million cars and trucks were sold in the United States last year, the lowest since 1981. Automakers and analysts are expecting sales to improve to about 12 million vehicles this year.

But it's interesting how perspectives change. A few years ago, when about 17 million cars and trucks a year were flying off dealer lots, a 12 million sales year would have been considered a disaster.

As the headline on this post asked, what will be the impact on Michigan? (Bloggers get to bury the lede.) Better sales and more stable finances are good news for the state's ravaged economy. Layoffs should subside and more tax dollars should flow to state government's depleted coffer.

But a shrunken domestic industry just doesn't have the power it used to to drive the state's economy to prosperity. In previous recessions, all we had to do was wait for the auto industry to bounce back and Michigan was off to the races again.

That's not going to happen this time. There likely will be little hiring in the industry this year, especially in those traditional factory assembly line jobs that for so long sparked the state's economy.

And while automakers and the politicians attending this year's show will gush over how the industry will be transformed by battery power, the payoff is likely still years away. GM's much ballyhooed new battery assembly plant in Brownstown Township, for example, will employ only about 100 workers.

But the year is young and the possibilities are endless. That's the message of the North American International Auto Show, not a bad thing on a cold, snowy January day.

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