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MARCH 16, 2003

Hard times ahead for automobile manufacturers

The credit rating agency Moody's Investors Service says that the automobile manufacturers are facing a tough year in 2003 with forecasts of sales being lower than in 2002, which was already a bad year for many of the automobile firms, notably Fiat Auto. Moody's is seen in the industry as a solid sources of evidence pointing to market trends and its influence is considerable. At the moment Moody's has assigned negative outlooks for DaimlerChrysler, Fiat and for Volvo. These are based on expectations that European and North American automobile markets will not see any growth before 2004.

Provisional figures released last week by the ACEA show that sales in February were down 3.5%. This was an improvement on January which had sales down by seven percent. Among the companies suffering the worst were BMW down 15.8%, Renault down 8.4%, Volkswagen down 2.2% while Ford and GM were in line with the market.