Corporate Survival vs. Consumer Confidence

As I travel around the country the vote on the automotive bailout is a hot topic. My straw poll runs about 50-50 among dealers and associates; their reasons vary, but for the most part they are looking at it as small businessmen who have had to survive by their own means. An AOL on-line survey with nearly 37,000 responses [which is a huge sampling compared to Gallup, etc.] showed 55% opposed the automotive bailout. The second question asked if respondents owned a domestic vehicle, and the response was 69% drove domestics.

There is no question hundreds of thousands of jobs are at stake, as well as a network of businesses beyond the manufacturers who are watching intently. But the bottom line in the big picture to me is going to be consumer response in the marketplace. The most recent information we have indicated only 30% of Americans were even considering buying a vehicle new or used in 2009. Understanding full well that figures can lie and liars can figure, here is my take [which is business talk for best guess]:

“If the bailout moves another 10% of our market into the shopping cycle for the year, based on roughly 11,000,000 vehicles forecast for next year, that’s another 1.1 million sales. The bailout is good for the big boys, another million plus vehicles being sold is good for my boys! Here’s hoping the bailout starts the turnaround and the market responds beyond our expectations.”