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For Carmakers, Just How Bad Can It Get?

At "worse rates" of 10.5 million in 2009 and 2011, Ford says it would need $13 billion, a scenario under which "a prolonged economic slump persists into 2010 as significant monetary and fiscal policy easing does not provide any stimulus to consumer and business spending."

By contrast, the only variation in GM's request for $18 billion concerned how much of the money GM would actually use. However, under "the downside scenario," with sales at 10.5 million in 2009 and 11.5 million in 2010, the company said it "would make full use" of the money.

GM fully expects to come out on the other side. "You never wish this kind of crisis on anybody, on the country or our industry," said GM CEO Rick Wagoner, on a conference call after President Bush announced his bailout plan. "It has led all of us to look at everything we've done historically and say, 'what can we change to make the company viable for the future?'" Wagoner said.

"Difficult as it is, it's an opportunity to us once and for all to get the negative sides of 100 years of history leveled up," he said.

As to the timing of a recovery, Global Insight is targeting 2010, which Wolkonowicz says has the potential to be a good year for sales, understanding that the economy and employment have to recover.

"There's nothing structurally there to make it come back," he says. "But it will probably start to come back in second half of 2009 because of the economic stimulus by the new administration. So we believe it's another 12 months, possibly 18 months before we start to pull out of this."

At that point, pent-up demand for automobiles may come into play, even if drivers don't really need new vehicles. "Cars are so much better today," Wolkonowicz says. "The worst thing that could happen would be for consumers to figure out how much longer they can keep cars. So far, that hasn't happened."

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