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The US automotive industry scaled back its ad efforts in recent months, and the government bailout will likely have no effect on those plans, MediaBuyerPlanner reports.
In an email to AdAge, Mark LaNeve, vp-vehicle sales, service and marketing North America for GM, said Friday's loan announcements "have no effect on our ongoing efforts to scale our marketing activities and spend to a level consistent with our viability plan submitted to Washington and the low level of the overall automotive market."
GM slimmed first quarter TV buys, but made no decisions beyond Q1, a spokesperson for the company said. Chrysler is also said to have cut its first-quarter ad buys. Auto makers could reduce ad spend by as much as $3 billion this year, leaving auto ad spend down $15 billion from its high of $24 billion in 2004.
The federal bailout plan entitles GM to $9.4 billion in December and January, and Chrysler to $4 billion. GM may receive another $4 billion in February. The companies will be required to pay back the loans if they don't come up with viable plans by the end of March.
Ford said it does not need the help, and online buzz fell heavily in Ford's favor as bloggers and Twitterers expressed appreciation to the company for declining the cash, AdAge writes.
Edmunds.com predicts the industry's US December sales will be 9.8 million vehicles. Jesse Toprak, senior analyst for the site, says no automaker can survive as a viable business in the States if less than 11 million vehicles are sold annually industrywide. Over half (55%) of US consumers are delaying a planned purchase of a new vehicle, or opting for a pre-owned one because of the current recession, lack of confidence and a weak stock market, according to TNS.
Earlier this month, ZenithOptimedia cut its '08 and '09 ad spend projections, in part as a result of woe in the auto ad market.