U.S. Auto Industry Seen Slowly Improving

DETROIT, June 15, 2009; David Bailey writing for Reuters reported that the Americas unit of German auto parts supplier Robert Bosch expects U.S. auto industry sales to fall 30 percent in 2009 but can see a market bottom with slow improvement, the unit's chief executive said on Monday.

"I think on the automotive side that we see the bottom now and that we could expect that for the remainder of this year that we see some slight improvement, but not a very significant jump," Peter Marks told Reuters Television in an interview.

"The consumer is still apprehensive to spend money because unemployment still seems to be rising and housing prices are down," Marks said on the sidelines of the National Summit.

He said the year would be difficult overall for Robert Bosch, the world's biggest auto parts supplier, "because the automotive (sector) is suffering."

"Even so, we are very globally represented as a company, and we are balancing some of the slow economy in the U.S. with a better-faring economy in China and in India," he said.

Robert Bosch continues to invest in research in development in the automotive sector, where it expects to see increasing focus in the United States with the adoption of strict mileage standards.

"The auto industry is now really embracing technologies, which are more fuel efficient, and Bosch has the answers so we will not take down our R&D expense so that we couldn't support the auto industry," Marks said.

The company also has investments outside the industry in areas such as wind turbines and solar panels.

Marks was speaking at the National Summit, a conference that has brought together executives, academics and politicians to discuss issues facing the U.S. economy including the need for coherent energy and industrial policies.

The summit is being held in Detroit, the hub of the faltering U.S. auto industry, but is not specific to the car industry or the Michigan economy.

In a presentation text, Marks said Robert Bosch expects global hybrid vehicle production to reach 3 million to 5 million vehicles by 2015 and about 500,000 pure electric vehicles.

It will take several years for electric vehicles to become cost-competitive, Marks said in the presentation.

In response to a Reuters Television question on the Detroit-area economy, Marks said he did not expect the region to return to the economic heyday at the height of the U.S. auto industry, "but it has a good chance to have a very thriving economy."

Michigan is working hard to promote renewable energy businesses for the auto industry and other sectors, he said.

"I think they are well on their way to doing so, which will also benefit Detroit and Michigan as a whole," Marks said.

Editing for Reuters by John Wallace and Leslie Gevirtz