Surge of Oil prices and the auto makers plight in US

It is a known fact that for 2 years the auto makers have told investors, creditors and workers to remain patient. They did feel that a turnaround was around the corner and an industrywide restructuring was posiible anytime. But the surging oil prices, have made the auto industry in US bumping at a decade lower.

Many US citizens have deviated from buying new sports utility vehicles (SUV's ) and trucks in view of the price crisis. This has also meant a dark future for many of the leading auto makers of the US. Auto Makers in US have been running on a negative profitability since this crisis had started. It has become a full blown problem in the months.

The future seems to be slipping out of control for many of the auto makers. The Economic pressure on the auto industry has been so big that auto giants like "FORD MOTORS" have already said that it would miss its target of returning to profitability by 2009.

Companies like Ford, General Motors and Chrysler have the cash and credit to sustain in such demanding situations, while they play for time and keep looking for opportunities lurking. There is definetly some time to pull out of the crisis. But if the US auto markets fail to bottom out in 2008, the threat of failure in the industry grows proportionately.

As the average prices crossed $3.50 Gallon this month, Ford sees signs of trouble ahead. The Japanese car makers, Nissan and Toyota both remain profitable because neither of these companies rely heavily on truck sales. While Toyota overtook Ford as the number two player in 2007, Honda is close on heels to unseat Chrysler as number three. This is mainly due to the leading fuel economy provided by the auto giant.

How to combat the fuel price hike? This mainly lies in looking for the fuel alternatives. What happens in a decade from now and the steps that are taken determine the future. Now a point has reached where significant response is emerging from consumers alike. An example would be T.Boone who make billions betting on the oil price hike has decided to spend many billion dollars building a wind farm. Due to subsidies and initiatives taken by the US ethanol comprises 5-7 % of the of the US gasoline pool. Americans have also started buying more fuel efficient vehicles rather than the gass guzzling Suv's.