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Detroit Motor Show opens to tough market

 Detroit Motor Show opens to tough market
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With the car sales market not exactly bullish, the Detroit Motor Show is underway as US manufacturers face another tough year. More than half the cars sold in the US last year were from Asian or European carmakers and with oil prices rising, the trend is away from the big cars and 4×4 pick-up trucks that have made so much money for GM, Ford and Chrysler in the past.

Big pick-ups are a favourite with building contractors and George Pipas, who analyses sales for Ford, admits the US economic outlook is not good: “As far as the overall truck business is concerned in 2008, I think we approach it with a little bit of caution because we won’t expect a quick turnaround in the housing industry and so from that standpoint it’s not likely we’re going to get a lift from the underlying economic fundamentals but in terms of this product in the marketplace, we ought to be able to do real well with them.”

Even without the threat of a recession, US vehicle sales have been steadily falling. They were down 2.5% last year to 16.1 million. Industry experts expect sales to fall by 500,000 this year to as low as 15.5 million.

US car makers are also under pressure to cut fuel consumption which is why they – and other
manufacturers – are pushing environmentally friendly vehicles including hybrids. Even Ferrari is showing a bio-fuel car that runs on ethanol; there are also offerings from hybrid offering from BMW and Mercedes-Benz. General Motors boss Rick Wagoner said alternative sources of propulsion have to be developed and increase use of alternative fuels is a “business necessity and an obligation for society.”