Crisis prompts car execs to rethink business priorities

[rickaren]

Crisis prompts car execs to rethink business priorities

Posted Monday, Aug 10, 2009, 1:31 pm in Employee News

A survey of automotive industry executives from around the world shows that the current economic crisis has prompted most to seriously rethink their business priorities and put financial stability ahead of near-term profits, The Detroit News reported.

According Ernst & Young, 61 percent of those surveyed said they are conducting a top-down review of current cash management and cash flows, the paper said. The same percentage said they are reviewing all of their debt covenants and closely monitoring their company’s compliance with them, the News said. However, the survey also found that 30 percent said they plan to increase their spending on research and development over the next 12 months, the story said.

“The global economic crisis has caused worldwide setbacks and, as a result, many companies in 2009 are balancing liquidity and cost management with the need to invest in new products,” said Mike Hanley, leader of Ernst & Young’s global automotive practice. “Companies must adapt to this new economic environment and work strategically to identify opportunities to run their businesses more efficiently, grow and remain competitive.” (The Detroit News)