Why Remaking the Auto Industry Makes No Sense

The auto industry doesn't work by the basic laws of the market—governments just won't let dead companies go

There are two competing theories on how to reset the auto industry. One is that entrepreneurs can create auto companies from scratch by outsourcing major component systems and abandoning traditional dealers. The other is that five or six giant companies should rule in a globally consolidated auto industry.

Neither theory makes sense.

Why Remaking the Auto Industry Makes No Sense - BusinessWeek

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its nuts, federal govt has to bail out the car industry, we cant afford to lose it. It would have too big an impact on the economy.

Speaking as an outsider, America is not losing it's car industry [with or without a bailout] at worst it is losing some of it's iconic brands, but business should be no more open to Government manipulation, than it can be held together by pure sentiment alone.

Even without GM and Chrysler, America still has a huge automotive industry, albeit the brands are not home grown...Honda, Toyota etc have invested in the American economy with manufacturing plants and American employees and show no sign of stopping if the market is there to expand.

A free market does not harm the economy, protectionism will, bailing out GM for example costs every single taxpayer, while harming further investment by home grown Ford or foreign owned Honda... the later two stand to be more profitable if the demise of GM was allowed, providing a greater tax take and helping the economy at large, supporting the lame duck, not only uses up tax payers money, it prevents the competition being leaner, more profitable and paying into the tax pool.