While times are tough on TV, print advertising is taking the brunt of the blow. Newspapers took a $131 million hit in the first quarter of 2008 as dealers have pulled back on full and half-page ads due to slow sales and limited cash flow. The proliferation of mainstream Internet advertising is also cutting into old media's profits, as automakers feel they're getting more bang for the buck with less expensive online ads. With the car market looking worse by the day and the unabated growth of Internet advertising, we don't expect this trend to reverse itself any time soon.
[Source: New York Times
Mainstream media has been quick to pile on Detroit automakers, which, along with some questionable Motown metal, has helped drive nationwide perception of the Big Three into the ground. Now that times are tough at traditional media outlets, well, that's Detroit's fault, too. Back in 2004, about $24 billion was doled out to television, print, and radio ads. Fast forward to 2008, and painfully slow sales coupled with cash-strapped automakers and dealerships have cut that number to about $15 billion. That's putting an Excursion-sized dent in the earnings of stalwart media companies like Viacom and Time Warner (Autoblog and Weblogs, Inc. are owned by Time Warner), as the media giants point directly towards Detroit and a soft auto market to explain their drop in revenue.