Auto Industry Quotes
After the Second World War Japanese industry had mostly not yet been rebuilt from the destruction of the allied bombing. The automobile industry, which before the war had aspirations of worldwide competition had been reduced to one company making less than 1000 cars a year and not many more trucks. However, when the Korean War broke out, there was a need for many military vehicles to support the allied war effort. Japan being so close and having very low labor rates had the opportunity to supply many of the needed vehicles. This allowed Nissan, Toyota and Datsun to get on their industrial feet, and from there to become world leaders. Hence, for Japan, the war was a gift from the Gods.
In the Meltdown of 2008, the American Auto Companies were in dire straights and faced bankruptcy with no certainty that the industry could stay alive., They were running out of money and President Obama decided to make loans, take stock and control and force modernizing on the industry. As a result, and with some Toyota mismanagement, the companies returned to profitability and paid back their government loans early and as a result the bailout had not cost the taxpayers any money. Creditors however were outraged that the lost their preferred advantage had their been a bankruptcy.
The practice worked fine in the Automobile industry, until there was intense competition from imported cars, and price increases were not easy to sustain and keep market share at the same time. When the automobile executives made some bad decisions, there was great conflict with the Unions who argued that it was the management that made the big mistakes and therefore the workers should not have to reduce their remuneration, and the automobile companies were caught in a death spiral where there costs were too high for the cars they made, the quality had slipped in an effort to save costs, and they did not make the smaller, low gas mileage cars that were in demand. The industry would have failed completely had it not been for the George W. Bush and Barack Obama administrations working together to bail out the American auto companies to the distress of many conservative ideologues in and out of Congress. See {637913} for a classic right wing ideological response to bailouts earlier.
