Why Asian Automakers Don't Want Detroit to Fail

Big Three bankruptcy would disrupt supply chain, further sour US economy
By Clay Dillow,  Newser Staff
Posted Dec 16, 2008 11:01 AM CST
Executives from Detroit's Big Three and chief of the UAW on Capitol Hill angling for federal aid for the auto industry.   (AP Photo)
camera-icon View 1 more image

(Newser) – As Detroit’s Big Three await word on the fate of their much-needed bailout, an unlikely group of supporters has assembled in their corner: foreign automakers. A collapse of General Motors, Ford, or Chrysler would devastate overseas manufacturers as well, CNNMoney reports, spreading bankruptcy to suppliers around the globe and forcing dealer networks worldwide to replace failed brands.

The US is the largest market for Toyota, Honda, and Nissan, and a failure in Detroit would cause more economic turmoil, further stifling demand for their cars. A fire sale of, say, GM’s entire inventory would decimate US auto prices, and the Asian giants also worry that a low-cost competitor like India’s Tata could quickly gain a foothold by buying up abandoned manufacturing plants.