GM says it will be cutting production by about 250,000 units, or about 33%, in the first quarter of next year. Honda will reduce production by about half that amount, 119,000 cars, over the same period.
That both domestic and foreign carmakers are pulling back production hints that the problem is not endemic to the Detroit malaise, but rather to the market as a whole. According to The Detroit News, GM spokesman Chris Lee said of the cutbacks, "This is unprecedented. Basically anything we're doing now is unprecedented. The market has tanked."
Job cuts, production cuts and other measures to reduce spending and align output with demand are the mode at automotive headquarters throughout the country. The U.S. Senate's rejection of the $14 billion aid bill last night seems to put a finer point on the matter, Lee said the production cuts were going to happen regardless of the outcome. "It's in response to falling market demand," he said.