Detroit's bumpy road to better times

U.S. automakers struggle with weak sales, ongoing losses as Detroit auto show kicks off, but lower labor costs, overseas growth could help in future.

The Detroit News welcomed Detroit auto show attendees to town over the weekend with the headline "Carmakers try to overcome gloom."

Oil at $100. The worst sales since 1998. Billions in continuing losses. New fuel economy regulations on the horizon.

There's plenty weighing on the industry, especially the U.S. automakers, as they gather for what is officially called the North American International Auto Show. Forecasts are that U.S. sales are going to be down again this year from last year's weak level, as both high gas prices and a weak housing market weigh on car buyers.

But while there's plenty of trouble facing the industry, there are also signs of hope for U.S. automakers, in the form of new labor deals, new management and new opportunities overseas.
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"As bad as it is, it could be worse," said Tom Libby, senior director of industry analysis for J.D. Power and Associates. "If you think about it, all three have taken big steps. None of them will have the strength they used to have in the near term. But they have some good new product in the pipeline and the drop in costs is going quicker than they anticipated."

Still, Libby and other experts agree it's going to be another tough year ahead for the industry in general but for the Detroit based automakers, in particular, as Ford Motor (F, Fortune 500), General Motors (GM, Fortune 500) and Chrysler LLC try to stem ongoing losses from their auto operations.

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