Last week was not a good one for the newspaper industry, and this week appears to be full of bad news for automakers.
Some 900 journalists lost their jobs through layoffs and buyouts at large and mid-sized newspapers throughout the U.S. This week, General Motors, Ford and even Toyota announced that June sales were off by more than 20 percent and consumers, faced with high gas prices and concerns about the overall health of the economy, chose not to spend.
It would not surprise me a bit if between now and the end of next year, one or more major metropolitan daily newspapers shut their doors for good.
The reasons are many: Lower readership and circulation revenue due to new media competition; lower advertising revenue due again to competition from new media coupled with a deteriorating economic situation; and, perhaps most importantly, having too much debt. Big companies simply overpaid for the newspapers they purchased in the past few years, and with the economic downturn they are finding themselves unable to generate the cash needed to meet those notes.