Weak Dollar Dents Car Profits
 Illustration Courtesy e-watchman.co.uk |
Washington DC March 27, 2008; The AIADA newsletter reported that the falling dollar is forcing automakers to scramble for ways to maintain profit margins on cars they import from Europe, Asia, and Canada.
While American manufacturers are lowering the number of cars they build in other countries, international carmakers are considering producing more models at U.S. plants or building new factories.
USA Today reports that some are even increasing production here to ship more U.S.-made cars overseas. "The pressure will be for the dollar to continue falling," says Joerg Dittmer, senior industry analyst for consultants Frost & Sullivan. The result will be "more domestically made cars."
BMW, for example, is expanding its Spartanburg, S.C. plant to build the new X6 and the next version of the X3. The move "certainly helps" offset the dollar's weakness vs. the euro, BMW's Tom Plucinsky says.
Toyota credits its 10 U.S. assembly plants for helping it weather the dollar fall, though spokesman Xavier Dominicis adds, "Our decisions are not dictated by currency exchange rates."
