Automakers looking for space to grow have targeted Asia and Latin America, where there are fewer competitors and more potential customers. Analysts estimate automakers will have the capacity to build about 70 million vehicles a year by 2002, but demand will equal just 60 million vehicles. And even for those deals in place for a decade or more, there can still be a healthy debate about the returns. DaimlerChrysler's chairman, Juergen Schrempp, said Monday that Mitsubishi would look to reduce capacity soon, possibly by selling a Japanese factory. Jim Hall, an industry analyst with AutoPacific in Southfield, Mich., said worries about overcapacity may be a little overblown.
Automakers can carry extra capacity profitably, and find a use for it with new product.
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