Thursday, October 9, 2008
A new report says U.S. auto sales will hit recession levels this year, threatening their survival.
The impact of oil prices at the beginning of the year was mild compared to the squeeze from the credit crunch. As Nigel Griffiths, Global Insight's managing director of global forecasting, points out, expensive oil merely meant that wealth was being transferred to oil-producing countries like Russia from oil-consuming ones like the United States. Now, the credit crunch is destroying wealth and making it impossible for customers to buy. "The impact is worse than if the price of oil had been sustained at $200 a barrel," he said.