On the surface, this looks like dueling headlines:
Wall Street Journal: Car Makers Help Drive Economic Recovery
New York Times: The Auto Industry, Stuck in the Slow Lane
But a closer look reveals more of an agreement. According to the optimistic Journal story:
A resurgent auto industry has weathered the supply-chain hitches that stifled production during the spring and is poised to double the pace of U.S. growth in the third quarter, according to some estimates. But that may not be enough to help beleaguered consumers and businesses get a flagging recovery back on track.
Form the pessimistic Times story:
A report released on Wednesday by AlixPartners, a business consulting firm, projects modest sales growth for the foreseeable future.
. . .
American automakers have already regained their profits. And future sales will be fueled by population growth in the United States as well as growing demand in developing markets.
But, in both cases, a more pessimistic view persists. The reason may be a strong dose of reality. As the Times story notes:
John Hoffecker, managing director at AlixPartners, said the level of sales before the recession was unsustainable.
“Many people were thinking that was the norm,” Mr. Hoffecker said. “And our view was that it was not actual demand.”
I tend to agree. We cannot sustain future economic prosperity by trying to return to the economic structure of the past. New industries will emerge; manufacturing will reinvent itself. and if it doesn’t, we well all be left behind – for we need a strong manufacturing sector, but not the manufacturing sectors of the now-past industrial age.