Big Three automakers General Motors (NYSE: GM), Ford (NYSE: F) and Chrysler plan to decrease production of full-size pickups - - including curtailing production for all or part of January 2008, due to a slowing economy that's expected to decrease sales, The Wall Street Journal reported Friday.

Earlier this week General Motors announced it will impose a two-week shutdown at its pickup truck plants in January 2008.

Ford said its truck plants would likely reduce overtime or impose temporary shutdowns in January 2008 as part of its Q1 production cutback.

Chrysler LLC said it will stop production at plants in Warren, Mich., and Fenton, Mo., right before Christmas through all of January 2008.
Automakers have braced Wall Street analysts and economists that sales would remain sluggish (or possibly worse) into 2008, due to economic headwinds, (including softer job creation and a tightening credit market), which has lead to an increasingly-cautious U.S. consumer.

"It's just a rough time in the auto sector, right now," Analyst C. Leonard Bauer, formerly of Prudential, told Bloggingstocks Friday. "The Big Three have made strides to cut costs and realign their fleets, but the sector's headwinds now are strong. Full-size pickups are high-profit vehicles but the companies just can't move as many out of the showroom with a slower economy and gas and diesel prices above $3. It's going to be a challenging winter for the automakers, and most likely they'll need to offer more incentives and discounts for consumers."

Sales of full-size pickup trucks fell 8.3% in November 2007 from a year earlier, a larger drop than the industry had seen in most previous months, according to Autodata Corp. Through October, pickup sales were down only 3%.

Sector Analysis: The Big Three's news is not unexpected, given the likely slow-growth U.S. economy for at least Q1/Q2 2008, concerns about the economy's ability to create (and maintain) jobs, and elevated fuel prices. The Big Three are taking measures to improve the fuel economy of full-size pickups, but fuel costs and considerably lower demand for pickups from housing construction contractors all but guarantees lower sales in this category for 2008, and possibly for 1H 2009.