Auto Sales: No Turnaround Yet

We expect 2009 to be the year of the lowest auto sales in decades. In our view, lower sales and production this year have so far contributed significantly to two automaker bankruptcies (General Motors Corp. and Chrysler) and multiple auto-supplier defaults and has pushed a number of other auto suppliers close to default. In our view, significant structural changes are under way, most notably the completed in-court restructurings of GM's ('D') and Chrysler's (unrated) ongoing operations.

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