Updated: January 9, 2012 5:21 PM | By AFP

Detroit hails resurgence of auto industry

Detroit celebrated the resurgence of the US auto industry Monday as a renewed sense of optimism -- along with a dose of glamour and glitz -- returned to the Motor City's annual auto show.

"As you look at these breathtaking vehicles, I ask you to remember they represent more than creative thinking and design," US Transportation Secretary Ray LaHood said at the opening ceremony.

"They represent American factories bustling and humming, American workers churning out cars, and American families earning paychecks again."

Just three years ago, the survival of the Detroit Three automakers was in doubt as General Motors and Chrysler sought billions in government bailouts and Ford's balance sheets hemorrhaged red ink during the deepest economic downturn in decades.

All three of Detroit's carmakers are now yielding profits again for the first time since 2004 and posting market share gains for the first time since 1988.

Experts also predict car companies will add 190,000 jobs by 2015, after shedding 400,000 jobs in 2008, LaHood said.

While the industry still faces deep risks -- especially in Europe -- global auto sales are forecast to grow from around 70 million vehicles in 2012 to 110 million in 2020, Mercedes chief executive Dieter Zetsche said.

"A disproportionate part of that growth will be the premium segment, and we intend to take the lion's share of that growth," he told reporters at the launch of the new SL roadster.

But the near-term outlook is still on "shaky ground," cautioned Brandon Mason, an auto analyst with PricewaterhouseCoopers.

"I don't think we're in fear of anything like a double-dip recession. But it's that jobless recovery that is the big fear," Mason told a Society of Automotive Analysts conference.

The Detroit Three will have to fight hard to sustain their comeback.

Toyota and Honda are looking to regain ground lost when their inventories were crippled by the March 11 Japanese earthquake and tsunami.

South Korean carmakers Hyundai and Kia -- the big success story of the downturn, after winning over consumers seeking good value -- will be working to keep up their momentum.

And with their own home market in the dumps, Europe's giants were also planning on squeezing more growth from the United States.

The challenge to the US big three was underlined by the models winning Detroit's prestigious car and truck of the year awards on Monday: South Korea's Hyundai, for its Elantra sedan, and Britain's Land Rover, for the Range Rover Evoque sport utility vehicle.

After a few years of austerity, luxury was back in style at the Detroit show, the premier American auto exposition.

Germans BMW and Mercedes managed to overtake Toyota's Lexus brand in US luxury sales in 2011 amid the Japanese automaker's supply problems, and will be jostling to hold their ground.

"I think we'll see good progress... with consumer confidence rising here," said BMW's Ian Robertson, after selling 305,000 units in the US last year.

"There's nothing like competing at the highest level to sharpen the best edge in people," GM chief executive Dan Akerson said at a sneak peak of the latest Cadillac, GM's luxury-segment leader.

More than a dozen automakers are vying for the attention of 5,000 journalists with the launch of at least 40 new models on Monday and Tuesday, some ready to hit showrooms and others being rolled out as concept cars to test the waters.

GM will be introducing two small cars -- the Chevy Spark and Sonic -- aimed at winning over young "millennials," while Chrysler will show its first Fiat-based small car, the Dodge Dart.

Daimler's Smart will introduce a miniature pickup truck concept car that will be sure to grab attention.

Ford launched its new Fusion in three models for different levels of energy-consciousness -- gasoline, hybrid, and plug-in hybrids -- all coming in a new more European-styled shape, and aimed at wresting Japanese market share in the key mid-sized car market.

"The time is right to change the way people think about midsize cars," said Ford Americas president Mark Fields.

Automakers will also have several swank sports cars on offer, like the Lexus LF-LC hybrid concept and the new Porsche 911.

Green car fans will get a look at Volvo's plug-in hybrid concept, new hybrids from Mercedes and BMW, and an electric van from Nissan.

The North American International Auto show opens Saturday and runs through January 23.

© 2012 AFP


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