GM's clouds have silver interiors
Things may look gloomy, but General Motors executives see signs of hope.
Detroit (Fortune) -- If you are looking for a discouraging word on the U.S. economy, you couldn't find it around the General Motors stand at the Detroit Auto Show Sunday. Executives are putting the best face on some fairly dour economic statistics.
"We think '08 will be down slightly from '07," Cheif Financial Officer Fritz Henderson said, though he added that "the risk of downside has increased in the last six months."
Troy Clarke, head of North American Operations, sees a lot of positive signs. He noted that the auto industry's rate of retail sales, as opposed to commercial fleet sales, increased sharply in December, up to 13.7 million units a year from 12.6 million last fall. And he added that GM (GM, Fortune 500) entered the new year with its lowest inventory of unsold cars in ten years.
One worry point for Clarke. He says there will be an unusual number of interest rate resets in February, March, and April. That could put a squeeze on some home owners.
But in total, he concluded, "I think it is very hard to envision a quarter when we run below [an annual rate] of 16 million units. That wouldn't be a strong year but would be nearly as strong as '07.
GM Chairman and CEO Rick Wagoner warmed to the topic when he pointed out that U.S. auto sales have been running below what it considers "trend" for three of our years. Either pent up demand begins to lift sales up to their usual level, he said, or "Do our trend gurus rethink trend?'