By Leftlane Staff
Friday, Dec 2nd, 2005 @ 6:46 pm

Auto advertising, which has risen steadily every year for a decade — excepting one 4% slump in 2001 — will go flat in 2006, according to a report issued today from Merrill Lynch, as cited by Advertising Age. “Intensifying turmoil in the domestic auto industry will put increased pressure on ad budgets next year,â€? said John Casesa, auto analyst at the investment company. He predicted that automakers’ U.S. spending in calendar 2006 will be essentially flat at $11.5 billion, following an estimated rise of 6% to $11.4 billion this calendar year. The financial woes of General Motors and Ford Motor, which are restructuring, cutting staff and production, will put pressure on all their expenses, including advertising. But Mr. Casera cites reasons why he doesn’t believe auto outlays will fall, including heavy new-model-launch schedules; a generally more competitive market; brand-rebuilding strategies of some marketers; and the increasing need to sell the deal.

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