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Industrial production is below the January 2008 level. Manufacturing is even more abysmal.

The Fed’s Industrial Production and Capacity Utilization report for November provides another set of sobering statistics.

• Industrial production (IP) moved down 0.1 percent in November after declining 0.4 percent in October.
• In November, manufacturing output rose 0.2 percent, boosted by a 3.5 percent increase in the index for motor vehicles and parts.
• The indexes for mining and utilities fell 0.9 percent and 1.3 percent, respectively.
• At 102.0 percent of its 2017 average, total IP in November was 0.9 percent below its year-earlier level.
• Capacity utilization stepped down to 76.8 percent in November, a rate that is 2.9 percentage points below its long-run (1972–2023) average.

Industrial Production Percent Change Month-Over-Month

It’s not easy to make sense of monthly numbers due to extreme swings month-to-month especially in autos and aircraft.

In October, November, and December, Aircraft production is down 11.3 percent, 11.3 percent, and another 4.4 percent in December.

The last four months for motor vehicles and parts are -9.9%, +9.1%, -5.4%, and +3.5% in December.

Industrial Production Components Percent Change Year-Over-Year

Year-Over-Year IP Numbers

• Industrial Production: -0.9 Percent
• Manufacturing: -0.9 Percent
• Motor Vehicles and Parts: -3.5 Percent
• Aircraft and Parts: -23.5 Percent
• Consumer Durable Goods: -4.3 Percent
• Manufacturing Durable Goods: -9.6 Percent

The Inflation Reduction Act, cleverly timed to keep things humming through through the election, helped pad demand for manufacturing durable goods, now crashing.

Trump Proposes Killing the $7,500 EV Credit

This would reduce demand for EVs when Ford and GM are already taking huge hits on EV production.

Let’s recap how this year in EVs has progressed.

April 4, 2024: Ford to “Re-Time” New EV Production, Expand Hybrid Production

Today Ford announces a two-year delay, “retiming” until 2027, on new EV models scheduled for 2025. In addition. Ford will focus on a full line of hybrids.

April 26, 2024: Ford Loses $132,000 on Each EV Produced, Good News, EV Sales Down 20 Percent

Ford (F) reports a huge loss on every EV. Sales are down 20 percent holding the losses to $1.3 billion.

August 21: Ford Cancels Plans for Electric SUV, Expects a $1.9 Billion Loss

Say goodbye to a vehicle that never should have been conceived in the first place. Customers don’t want it.

Hoot of the Day: Ford Wants Stricter Tailpipe Emissions

Here’s my flashback hoot of the day that I forgot about.

May 26, 2024: Hoot of the Day: Ford Wants Stricter Tailpipe Emissions

Ford has gone to courts, siding with Biden to defend the EPA’s rules on tailpipe emissions!

Hello Ford, please note Trump Proposes Killing the $7,500 EV Credit and Seeks Tariffs on Battery Materials

Kiss Biden’s ridiculous energy policies goodbye. We won’t miss them.

The transition team recommendations would allow automakers to produce more gas-powered vehicles by rolling back emissions and fuel-economy standards championed by the Biden administration.

The transition team proposes shifting those regulations back to 2019 levels, which would allow an average of about 25% more emissions per vehicle mile than the current 2025 limits and average fuel economy to be about 15% lower.

I don’t understand the case for rolling back goals we have already achieved, but perhaps I am missing something. Is 2019 a policy trial balloon?

However, team DOGE has no authority to do anything but make recommendations.

For example, DOGE wants to eliminate the Department of Education. Great, but this is an idea that been circulation for at least a decade by Ron Paul and others.

To Do and Undo

It’s much easier passing something than undoing it. Let’s see if we can even do something seemingly simple like killing EV subsidies.

Since EV subsidies are part of the Inflation Reduction Act, let’s see where that idea goes and how fast, especially with Ford and GM howling all the way.

So, color me skeptical until DOGE comes up with ideas we have not already heard about for the last 10 years, and then Congress actually votes on them, and Trump signs them into law.

An Interactive Exercise: What Would You Do to Balance the Budget?

On December 4, I offered An Interactive Exercise: What Would You Do to Balance the Budget?

I balanced the budget. Team DOGE hasn’t. But my proposals have the same philosophical issue.

It’s easier to do something than undoing it. Cutting the budget is mostly a case of raising revenues or undoing something that’s already done.

Good luck with that.

But one thing Trump can and will do is kill Biden’s EPA mandates. Consider that part done over the howls of Progressives like AOC and Elizabeth Warren.

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