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GM, Facebook, and Prospects for the Auto Industry

May 17th, 2012

GM's Facebook fan page

There’s big noise about the fact that General Motors recently pulled $10 million worth of ads off Facebook. Ford made it clear that its advertising would continue, and the two companies are squabbling.

GM says half its Facebook ads never get clicked on; Ford reached millions when it launched the new Explorer. The jury will be out a long time on this one.

While the food fight was going on, more important things were happening. Warren Buffet’s Berkshire Hathaway announced it had bought 10 million GM shares at well below the initial IPO price. That gave the stock a 2.3 percent bump.

Auto sales are on a roll, predicted to top 14 million units this year. Car sales accounted for fully half of the 2.2 percent U.S. economic growth in the first quarter. Take that, Mr. Romney.

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