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===Bankruptcy scenario===
===Bankruptcy scenario===
Bankruptcy of the Big Three would be very expensive to the economy as a whole and the federal government. It would mean loss of 240,000 very high paying jobs at the Big Three, a loss of 980,000 high-paying jobs at the suppliers and local dealers, and 1.7 million jobs throughout the economy. It would cause a decline in personal income of $151 billion the first year, and $398 billion over three years. The federal, state and local governments would lose tax revenue and spend on welfare programs a total of $156 billion over three years.<ref> CAR Research Memorandum. "The Impact of the U.S. Economy of a Major Contraction of the Detroit Three Automakers" (Nov 2008) [http://www.cargroup.org/documents/FINALDetroitThreeContractionImpact_3__000.pdf online edition]</ref>
Bankruptcy of the Big Three would be very expensive to the economy as a whole and the federal government. It would mean loss of 240,000 very high paying jobs at the Big Three, a loss of 980,000 high-paying jobs at the suppliers and local dealers, and 1.7 million jobs throughout the economy. It would cause a decline in personal income of $151 billion the first year, and $398 billion over three years. The federal, state and local governments would lose tax revenue and spend on welfare programs a total of $156 billion over three years.<ref> CAR Research Memorandum. "The Impact of the U.S. Economy of a Major Contraction of the Detroit Three Automakers" (Nov 2008) [http://www.cargroup.org/documents/FINALDetroitThreeContractionImpact_3__000.pdf online edition]</ref>
==World history==
===Germany===
[[Daimler-Benz]] is the industry's oldest firm, building automobiles since the late 1880s; its current structure dates from 1926. In 1998 it bought the American Chrysler, then sold out in 2007 at a heavy loss as it never integrated the new car in its line.
In the popular market, [[Opel]] and [[Volkswagen]] are most famous. Opel was a bicycle company that started making cars in 1898; General Motors bought it out in 1929, but the Nazi government took control and GM wrote off its entire investment. In 1948 GM returned and restored the Opel brand.
Volkswagen is dominant in the popular market; it purchased Audi in 1964. VW's most famous car was the small, beetle-shaped economical "people's car" with a rear-mounted, air-cooled engine. It was designed in the 1930s by [[Ferdinand Porsche]] upon order from [[Adolf Hitler]], who was himself a car enthusiast. However production models appeared only after the war; until then only rich Germans had automobiles. By 1950 Volkswagen was the largest German automobile producer.<ref> Terry Shuler, ''Volkswagen: Then, Now and Forever'' (1997) </ref>
Germany is famous for its upscale sedans. They are designed for high-speed cruising over the [[autobahn]]s. They feature well-designed suspension systems that provide both a soft ride and good handling characteristics on winding country roads. Engines are designed for sustained high-speed operation, though in general they are weak on acceleration.
[[Daimler-Benz]] produces the upscale [[Mercedes-Benz]], long a famous name in racing. [[BMW]] (founded 1916) and [[Porsche]] are major factors in the luxury market.<ref> David Kiley, ''Driven: Inside BMW, the Most Admired Car Company in the World'' (2004); Ferry Porsche, ''We at Porsche: The Autobiography of Dr. Ing. h.c. Ferry Porsche'' (1977) </ref> Porsche formed his own company, which today produces expensive, high-quality sports cars.<ref> Giancarlo Reggiani, ''Porsche: The Legend: 1948 to Today'' (2007) </ref>. In 2008 the Porsche company sought control of the much larger Volkswagen company; Porsche cornered the market for Volkswagen stock and made profits of tens of billions of Euros, while apparently gaining control of the bigger company.
===Japan===
Japan, with its large population squeezed into very high density cities with good public transit, has limited roadways that carry very heavy traffic. Hence most automobiles are small in terms of size and weight. Nissan began making trucks in 1914, and sold cars under the "Datsun" brand until it switched to "Nissan" in the 1980s. It opened its first U.S. plant in Tennessee in the early 1980s and a British plant in 1986. It is 44% owned by Renault of France. Honda, which began with motorcycles, emerged after World War II. Its luxury cars carry the "Acura" brand. Toyota began making cars in the 1930s and is now the world's largest producer. Its luxury models carry the "Lexus" brand. Toyota is famous for its innovative, quality-conscious management style, and its hybrid gas-electric vehicles, especially the Prius, which was launched in 1997. Other major companies include Subaru, Mitsubishi, and Mazda. Japan became the world's leading auto maker in 1980, the first year since 1905 that the United States had been outproduced by any other nation.
===Britain===
The auto industry developed late in Britain and for the first half of the 20th century the small output of British-owned companies focused on luxury and upscale models notably Rolls-Royce and later Bentley as well as Jaguar and Rover. The stress was on high quality hand-made craftsmanship, regardless of high cost.
Beginning 1925 William Morris, later Viscount Nuffield, began to mass produce small cars of modest power under the "M.G." nameplate. Morris modeled his methofds after [[Henry Ford]], and sought high volume production of inexpensive cars geared to the urban middle class. In 1953 M.G. merged with Austin to form the British Motor Corporation, the largest producer, which also produced the Austin, Austin-Healey, Morris, Riley, Wolseley. It added Jaguar in 1966. BMC specialized in small, economy sedans and sports cars, with 4 cylinder engines. It merged in 1968 with rival Leyland. Another rival was the Rootes group, with the brands Sunbeam, Talbot, Hillman, Singer, and Humber. <ref> Timothy R. Whisler, ''The British Motor Industry, 1945-1994: A Case Study in Industrial Decline'' (1999) </ref>
Ford opened a plant as early as 1911 and soon had 40% of the British market. In 1931 Ford opened the largest auto plant in Europe near London. Ford eventually acquired Aston Martin, Jaguar and Land Rover. By 2008 it was selling off those divisions.<ref> Huber Bonin, et al. ''Ford, 1902-2003: The European History'' 2 vol Paris 2003. ISBN 2-914369-06-9</ref> Rootes was taken over by Chrysler in the late 1960s and its brands phased out by the 1970s. The Chrysler operations were taken over by Peugeot in 1978. Nissan opened a plant in 1986.
After 1945 and the end of the Second World War, American and British firms dominated the European market. In 1950, of 523,000 cars produced in Britain, 398,000 were exported. By the late 1950s, however, the Germans were back, followed soon by the French and Italian producers, and Britain lost most of its continental market. By 1970 Japanese firms identified the British market as the first major European market to attack because of the relative weakness of the domestic car industry.<ref>Peter Johnson, ed. ''The Structure of British Industry'' (1988) ch. 8</ref>
When the domestic auto industry was largely nationalized in 1975, British Leyland was the holding company that controlled 40% of production. It was renamed Rover; it went bankrupt in 2005, ending the era of mass production by British makers. The Chinese purchased the MG brand, while Jaguar went first to Ford and now to TATA Motors.
The gentry who bought cars before 1939 found driving was easy on rural Britain’s smooth road surfaces in its generally mild weather. The rural roads are famously narrow and winding, so cars were small with stiff springs for good handling characteristics on them. High taxes on gasoline aand crowded streets encouraged smaller, fuel-efficient cars in the cities.
== Fuel ==
== Fuel ==
==References==
==References==
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[[Category:Business]]
[[Category:Business]]
[[Category:Economic history]]
[[Category:Economic history]]