Intel Corp (INTC)

[Windsock]

The Big 3 does have a cost problem but the article shows that the current cost of labor is a minor part of the cost problem. A big factor is the fixed cost of under utilized factories.

The Big 3 have suffered big losses in market share to the foreign competition. I saw some data showing a GM decrease in market share from 50% to a current level of about 20% Ford and Chrysler also suffered big losses of market share.

The current crisis for the Big 3 is the recession and tough economy. People are not buying cars from the Big 3 Toyota or anybody else because they are reducing spending. The purchase of a car is a discretionary item that can generally be delayed and is therefore one of the first cuts for most people.

One report I remember showed GM sales down by 40% while Toyota sales were down by 35%. Both are very bad numbers