Chapter 11: Domestic Automakers

As the American economy slips further into a recession, the Big Three (GM, Ford, Chrysler) face the looming possibility of bankruptcy, according to CNN.

In filing for bankruptcy, the automakers will likely follow Chapter 11. This means they may continue operating until they can meet the bottom line. However, making ends meet comes with severe consequences for the car makers.

If indeed bankruptcy is the only option for U.S. automakers, it would certainly result in thousands of layoffs of skilled American workers and the slashing of benefits for tenured employees.

Much needed government intervention did not occur to prevent rising energy and transportation costs from crippling America’s automakers. The nation’s oil addiction became evident in 2001 while the current administration and negligent U.S. auto-manufacturer managers did nothing.

Necessary changes to begin production of smaller and fuel efficient cars were never met. America is now losing vital jobs and one of its few remaining competitive industries is sinking because of poor government regulation and non-existent managing skills.

Source CNN Money:

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