BBDO Slashes Workforce as Auto Sales Plummet – Media Buyer Planner November 7, 2008
Posted by Mark Blei in : Uncategorized , trackbackBBDO Detroit laid off 145 employees – or 22.1% of its headcount – yesterday, as a result of the drastic drop in sales for the agency’s main client, Chrysler.
Chrysler has slashed its ad spending this year by about 30% as auto sales have dropped, reports The New York Times, and sales have worsened across the auto industry in recent weeks. Chrysler, Dodge and Jeep sales plummeted 34.9% in October compared with the same month last year. For the first 10 months of the year, sales fell about 26% from the year-ago period.
General Motors and Ford are hurting even more than Chrysler. Both posted larger-than-expected losses in the most recent quarter. GM said the results left the company in a shaky position, and that by the end of the year it could run out of cash. Ford’s position is comfortable, for now, as it has a $10 billion line of credit still available, the company says. But cash reserves have dropped by $7.7 billion, or about 30%, and the situation at both companies adds urgency to the Big Three automakers’ request for an additional $25 billion in federal assistance if the economy doesn’t improve, writes the Washington Post.
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