Ford to Overtake GM by 2012, Challenge Toyota

Ford, the only large Detroit automaker that managed to cope with the economic chaos without money supplied by the government, will overtake General Motors by 2012, according to an economic forecasting company. Furthermore, Ford might challenge Toyota in terms of sales, analysts working at Global Insight told the Detroit Free Press today.

“The good news is we are at the bottom. That bad news is the hole is deep and it will take long to dig out,” said George Magliano, Global Insight director of North America auto industry research.

The firm forecasts a slow recovery in the United States in the next 18 months, with General Motors and Chrysler losing ground in the domestic market. Basically, this is going to happen because of the discontinuation or sale of important brands, including Pontiac, Saturn, Saab or Hummer.

“Given all GM has gone through, getting back to 20% market share is just not doable,” Magliano added.

“We now see lower commodity prices. Whatever you think of the bank rescues a year ago, most of them have worked,” Nariman Behravesh added. “The Federal Reserve has provided robust stimulus by keeping interest rates low. Then the government will spend more stimulus money in 2010 than it did this year.”

The United States economy will reveal slight signs of recovery in the remaining months of 2009 when a 3 percent increase is a very likely scenario. However, unemployment will continue to grow until the spring of 2010, the analysts predicted, especially following companies' strong efforts to minimize the consequences of the economic recession.

“The U.S. consumer will no longer be the engine driving the global economy,” Behravesh concluded.