Pick Your Poison: Only Bad News at Auto Industry Confab

(MoneyWatch)  NEW YORK -- The single worst piece of news from an auto industry conference here on Sept. 18 was, there was no single worst piece of news.

It was a smorgasbord of bad news for the U.S. auto industry, a kaleidoscope of bad news, a minefield of bad news. One of the few printable things my U.S. Navy buddies used to say comes to mind: "The defecation has impacted the ventilation."

There was so much bad news, that the only good news was bad news, namely that lousy auto sales in the first half of 2008 were probably as good as they're going to get, at least until the end of 2009.

Remember, U.S. auto sales fell 10.1 percent in the first half of 2008, versus the year-ago period, according to AutoData. That included a 17.9 percent drop in light-truck sales. In June, for the first time in a generation, four cars outsold the former No. 1-selling vehicle in the U.S. market, the Ford F-150 pickup ?€" the Toyota Camry and Corolla, and the Honda Accord and Civic.

"The problem is, where we stand now, the first half of 2008 was good," said Robert Schnorbus, chief economist for J.D. Power and Associates, which co-sponsored the Auto Industry Hot Topics Conference, along with Standard & Poor's.

Outside the conference, the financial crisis raged, having just brought down Lehman Brothers, which filed for bankruptcy on Sept. 15. Attendance at the conference was a little sparse, as a lot of people who had signed up ?€" including at least one of the scheduled speakers ?€" were too busy fighting fires at their desks to come.

Here are just half a dozen examples of the bad news they would have heard in much greater detail if they had come, but trust me, there were more:

1. U.S. auto sales will probably fall to just over 14 million this year, versus about 16.1 million in 2007. That's the worst in at least 15 years.

2. Growth in developing markets like China and Brazil, which had been one of the few bright spots for the Detroit 3, is starting to slow.

3. Even if the Detroit 3 get U.S. government loans they're requesting, to help fund the development of more fuel-efficient technologies, the loans probably won't save the companies much money. They could help liquidity. However, none of the conference speakers was counting on the loans being approved.

4. Higher U.S. Corporate Average Fuel Economy standards, which mandate an average of 35 mpg by 2020 are really, really going to hurt. Ditto for CO2-emissions standards in Europe.

5. The stampede in the U.S. market from gas-guzzling trucks to more fuel-efficient cars is directed away from the strengths of the Detroit 3 and straight into the arms of the more fuel-efficient import brands.

6. Oh, and even though it hasn't been officially declared yet, the U.S. economy is in a recession, said David Wyss, Standard & Poor's chief economist.

Gregg Lemos Stein, a Standard & Poor's associate director, got one of the few laughs of the conference when he showed a slide that depicted historical auto sales. He said he wanted to offer at least one piece of good news: "Sales have grown quite nicely since the 1930s."