The Connected Auto Industry

From Andrew Sullivan's Daily Dish is a reminder of how interconnected the Auto Industry is -- not just the Big 3 but all of them. If one fails, even Chrysler, how will that effect everyone else? It's obvious that Congress has no clue as to what is involved, and I doubt most others of us do either.

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America's Other Car Industry, Ctd.

A reader writes:

Regarding Peter Klein, a few points,

• Ford has owned a majority stake in Mazda for decades. Nearly every vehicle in Mazda’s lineup is platform shared with a Ford, Lincoln, Mercury, or Volvo.
• Until last year GM was the majority stake holder in Subaru. GM sold off their shares to Toyota. Ditto Isuzu.
• Mitsubishi has been kept afloat for decades by Chrysler. In the 80’s and 90’s about half of the entire lineup at Chrysler was platform shared with Mitsubishi. Engines and transmissions are still shared today.
• Toyota and GM share a factory in California. The factory produces the Toyota Corolla, Toyota Matrix, and Pontiac Vibe.

BMW has used GM automatic transmissions on and off for years. BMW paid GM to develop the automatic transmission in the BMW 5-series and Cadillac CTS.

GM, Chrysler, and Mercedes Benz have a joint venture to build hybrid powertrains.

Chrysler alone, backing out of a deal to buy automatic transmissions, forced transmission manufacturer Getrag into bankruptcy. Getrag supplies transmissions for every auto manufacturer.

Ford and Nissan buy their hybrid technology from Toyota.

All of the auto manufacturers share suppliers. Any one of the Domestic 3 failing would likely take out the other two and severely damage the foreign owned companies ability to continue to operate here. That’s not to say they don’t need to reorganize, but to even do that they have to be able to make payroll and buy materials. That is what this loan is about. Additionally, to the foreign governments who are planning to protest any bailout by the US government as unfair to imports, the imports have been getting their own “bailout” for years via socialized medicine and other government subsidies.