• The Wall Street Journal, Thursday, July 17, 2008 9:15 AM

General Motors, one of the country's largest ad spenders, will create new pain for the advertising and media sectors by cutting its sales and marketing budget. The marketing cuts, which GM announced this week, are part of a broader cost-cutting initiative by the auto maker, the latest in a series of ad-budget cuts that started in 2006.

Newspapers, already struggling, have been the hardest hit. GM's ad spending on newspapers was down 32% in 2007 from 2006, per TNS. Compare that to GM TV ads, which dropped 11% in 2007.

GM's reductions could also encourage other automakers to cut back their advertising spending, says analyst Michael Nathanson. "It is going to get really ugly."

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