Auto sector bankruptcies to multiply

January 8, 2009
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, FRANKFURT, January 8 – Auto sector bankruptcies will multiply in the next five years, according to an international study released on Thursday by the auditing group KPMG.

After finding auto sector companies relatively optimistic last year, the latest KPMG survey said they now expect "lower sales and profits, more bankruptcies, and a long cycle of restructuring ahead."

"The mood has changed and the change was very rapid," the survey said.

For the past 10 years, KPMG has organised an annual survey of the auto sector.

Its latest edition questioned 200 company heads worldwide and found a very high level, 46 percent, felt their profits were volatile and hard to forecast.

This is not a good sign for a sector that depends in large part on long-term outlooks," the study quoted Uwe Achterholt, head of its German automotive unit as saying.

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