CSM Automotive Production Barometer (APB) - July 2006

DETROIT, July 14 -- CSM Worldwide, the leading provider of market intelligence and forecasting to the automotive industry, announces the July 2006 CSM Automotive Production Barometer(TM). Released in advance of existing sources of information, this service provides an accurate record of light vehicle production for the previous month to assist automotive economists and financial analysts in their ongoing industry evaluations.

The CSM Automotive Production Barometer for July 2006 and release schedule is currently available via the CSM Worldwide website: http://www.csmauto.com/auto-production-barometer .

U.S. light vehicle production continues its slide, falling 2.80% in June to a seasonally adjusted 11.39M units last year. Total U.S. car production was off 0.10% over last year with light truck output down 2.60% from 2005 levels. Actual unit production in the United States totaled over 1.04M units in June, posting a 2.60% decline from June 2005 and flat versus last month. North American production inched up, increasing 2.90% over last June to a seasonally adjusted 16.48M units. Year to date, production continues to outpace last year at 15.91M units, 2.30% above last year's pace through the first half of the year.

Of the New Six North American auto producers, there were three winners and three losers. General Motors, DaimlerChrysler and Honda posted increased output versus year-ago levels, while Ford, Nissan and Toyota lag last year's pace. Year to date, only Ford and Nissan exhibit continued weakness and trail last year's production rate, declining 2.80% and 7.90% respectively. While both are in negative territory, Ford has been climbing out of the hole and making inroads to reach year-ago levels, while Nissan continues to struggle with output eroding successively each month. Both automakers suffer from some product weakness and production transitions in preparation for new launches in the second half.

GM continues to make healthy production gains this year, with output to date up 2.70% and up 9.00% in June. Increasing inventory levels for select vehicles may be of concern as overall market demand is expected to weaken in coming months. DaimlerChrysler fired the first salvo in the incentive war, bringing back an "Employee Pricing" program, though Ford and GM have been reluctant to fire back with heavily incentivized programs of their own. GM and Ford are trying to take a disciplined approach to sales this summer, but with continued weakness expected and a very difficult year-over-year comparison to meet last summer's torrid "Employee Pricing" sales programs, it will be difficult to remain focused.

Another cause for concern is the rapidly deteriorating demand for the once almighty mid-size SUV, such as the Ford Explorer, Chevrolet Trailblazer and Jeep Grand Cherokee. The market has steadily shifted for several years now toward the more user-friendly, and often more economical, crossover utility vehicles. Increasing and more volatile fuel prices and a growing number of more refined CUV alternatives in the market are driving demand downward for the traditional SUV. Though the Traditional Big Three has over-weighted product portfolios of SUVs, they continue to roll out new CUV models, with more on the horizon.

Unlike the full-size SUV market, the mid-size SUV segment is more vulnerable to fluctuations in fuel prices due to a more price-sensitive consumer base that is more likely to seek alternatives to the mid-size SUV. The prospective full-size consumer has more disposable income to accommodate fuel costs and places a greater level of importance on the vehicle fitting the needs of their lifestyle.

CSM Worldwide (http://www.csmauto.com/ ) supports more than 450 of the world's top automakers, suppliers and financial organizations with global market intelligence and forecasting services. With corporate offices in Detroit, CSM Worldwide covers the global automotive environment from London, Frankfurt, Paris, Tokyo, Shanghai, Sao Paulo, Singapore, Bangalore and Budapest.