By Courtney Schlisserman Dec. 15 (Bloomberg) -- U.S. industrial production probably fell in November for the third time in four months, led by a slump at automakers as sales plummeted, economists said ahead of a report today. Output dropped 0.8 percent after rising 1.3 percent in October, according to the median estimate of 59 economists in a Bloomberg News survey. Another report may show the factory recession intensified this month. The weakest sales in 26 years have brought General Motors Corp. and Chrysler LLC to the brink of bankruptcy, prompting cutbacks in output that have deepened the yearlong recession. The Bush administration said last week it was willing to tap the $700 billion bank bailout fund to keep the automakers alive until January after the Senate failed to approve emergency cash. “Manufacturing activity is clearly stuck in a deep recession, aggravated by the difficulty of both buyers and producers in acquiring credit,” said Steven Wood, president of Insight Economics LLC in Danville, California. “Production of motor vehicles and supplies was particularly hard hit.” The Federal Reserve will release industrial production figures at 9:15 a.m. in Washington. Estimates in the Bloomberg survey ranged from a drop of 2 percent to a gain of 0.4 percent. Capacity utilization, or the proportion of plants in use, probably dropped to 75.6 percent from 76.4 percent in October, according to the survey median. Economists track plant operating rates to gauge factories’ ability to produce goods with existing resources. Lower rates reduce the risk of bottlenecks that can push up prices. The utilization rate has averaged about 80 percent over the past three decades. Regional Slumps At 8:30 a.m., a report from the New York Fed will show its Empire State index for December dropped to minus 27.3, the lowest level since record keeping began in 2001, according to a Bloomberg News survey median. A third report, at 1 p.m., may show homebuilder confidence climbed this month from a record low, the survey showed. The auto industry is at the center of the manufacturing recession. GM spokesman Tony Sapienza said in an interview last week that the automaker is cutting 250,000 units of production from its plan for 2009’s first quarter, a 30 percent reduction. Honda Motor Co. is cutting 119,000 vehicles from its North American production plan, tripling its reduction for the fiscal year that ends in March, the Tokyo-based company said last week. Auto Rescue The Bush administration last week dropped its opposition to using the bank-bailout money to save the automakers. GM needs $4 billion from the government by the end of the month to pay its bills. Autos sold at a 10.2 million annual pace last month, the fewest since 1982. The weakening U.S. economy is prompting a global growth slowdown that is also threatening American exports. Cummins Inc., the maker of more than a third of North America’s heavy-duty truck engines, said this month it will eliminate at least 500 jobs by the end of the year because of “continued deterioration” in the U.S. economy and other key markets. Cummins said in October that sales growth will be about 12 percent this year, lower than it previously forecast, as the U.S. and European economies weakened. Bloomberg Survey ================================================================ Empire Ind. Cap. NAHB Manu. Prod. Util. Housing Index MOM% % Index ================================================================ Date of Release 12/15 12/15 12/15 12/15 Observation Period Dec. Nov. Nov. Dec. ---------------------------------------------------------------- Median -27.3 -0.8% 75.6% 10 Average -27.3 -0.8% 75.6% 10 High Forecast -17.5 0.4% 76.9% 13 Low Forecast -36.0 -2.0% 73.8% 7 Number of Participants 38 59 54 30 Previous -25.4 1.3% 76.4% 9 ---------------------------------------------------------------- 4CAST Ltd. -30.0 -1.0% 75.5% --- Action Economics -25.0 -0.5% 75.9% 10 Aletti Gestielle SGR -28.0 -0.9% 75.6% --- Argus Research Corp. -36.0 -0.2% 76.2% --- Banc of America Securitie --- -0.5% 75.9% --- Bank of Tokyo- Mitsubishi -17.5 -0.4% 75.8% 9 Bantleon Bank AG -25.0 -1.0% --- --- Barclays Capital -30.0 -0.8% 75.7% 11 Briefing.com -28.0 -0.6% 75.8% --- CIBC World Markets --- -0.5% 76.0% --- Citi --- -1.0% 75.5% --- ClearView Economics --- -0.8% 75.5% --- Commerzbank AG -28.0 -1.0% 75.2% --- Credit Suisse --- -0.6% 75.6% --- Daiwa Securities America --- -0.5% 76.0% --- Desjardins Group -27.0 -0.6% 75.8% --- Deutsche Bank Securities -26.0 -1.5% 74.9% --- Deutsche Postbank AG --- -1.5% --- --- DZ Bank --- -0.9% 75.4% 9 First Trust Advisors -25.0 -1.0% 75.5% --- Fortis -25.0 -0.5% --- 10 FTN Financial --- -1.0% 75.0% 8 Helaba -28.0 -0.8% 75.5% 11 Herrmann Forecasting -24.4 -0.2% 76.2% 11 HSBC Markets -25.0 -0.4% 76.0% 12 IDEAglobal -28.0 -0.6% 75.8% --- IHS Global Insight --- -0.7% --- --- Informa Global Markets -26.5 -1.0% 75.8% 9 Insight Economics -27.5 -1.0% 75.2% --- Intesa-SanPaulo -30.0 -1.0% 75.6% 9 Janney Montgomery Scott L --- -0.9% 75.4% 11 JPMorgan’s Private Wealth -27.0 -0.7% 75.6% 10 Landesbank Berlin --- -1.0% 75.5% --- Maria Fiorini Ramirez Inc --- 0.0% 76.2% 10 Merrill Lynch -30.0 -0.9% 75.6% 13 MFC Global Investment Man --- -1.0% 75.5% 9 Moody’s Economy.com -27.0 -0.7% 76.2% 11 Natixis --- -1.5% 74.9% --- Newedge -28.0 -0.9% 75.8% 9 Nomura Securities Intl. -20.0 -0.7% 75.5% --- Nord/LB -27.0 -1.0% 75.5% 11 PNC Bank --- -0.4% 75.9% --- Raymond James --- -1.0% 75.3% --- RBS Greenwich Capital --- 0.1% 76.4% --- Ried, Thunberg & Co. -27.0 0.4% 76.6% --- Schneider Foreign Exchang -28.0 -1.5% 73.8% 10 Scotia Capital -30.0 -2.0% 75.0% 9 Societe Generale -30.0 -0.6% 75.7% --- Standard Chartered -29.0 -1.0% 75.2% 9 Stone & McCarthy Research -30.2 -0.7% 75.7% 10 TD Securities -30.0 -0.9% 75.0% 9 Thomson Financial/IFR -27.0 -1.6% 75.3% 9 Unicredit MIB --- -0.3% 76.0% 9 University of Maryland --- -0.5% 76.9% 9 Wachovia Corp. --- -0.5% 75.3% --- Wells Fargo & Co. -25.0 -0.5% 75.9% 10 WestLB AG -26.0 -1.0% 75.6% 8 Westpac Banking Co. -30.0 -2.0% --- 7 Wrightson Associates -27.0 0.4% 76.6% --- ================================================================ To contact the reporter on this story: Courtney Schlisserman in Washington at cschlisserma@bloomberg.net

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