Title: What role did regional policy play in addressing the US auto industry crisis?

Authors: Thomas Klier, James Rubenstein

Addresses: Federal Reserve Bank of Chicago, 230 S LaSalle St, Chicago, IL 60604, USA. ' Department of Geography, Miami University, Oxford, OH 45056, USA

Abstract: One of the first challenges of the newly inaugurated Obama Administration in 2009 was the parlous state of the Detroit 3 carmakers (Chrysler Group, Ford Motor Company, and General Motors Company). Without government intervention, Chrysler and GM faced the strong possibility of having to close their operations and to liquidate their assets. The Obama Administration|s publicly stated justification for rescuing Chrysler and GM was twofold: (1) short-term stabilisation of the national economy, (2) long-term strengthening of US manufacturing. Regional policy was not publicly stated as an important goal, but this paper concludes that one result of the rescue has been a tacit implementation of a regional industrial policy in the USA, though not an explicitly adopted strategy.

Keywords: US auto industry; automobile industry; Detroit Big 3 carmakers; regional policy; automotive manufacturing; industry restructuring; Chrysler Group; Ford Motor Company; General Motors Company; industrial policy; government intervention; USA; United States.

DOI: 10.1504/IJATM.2011.039544

International Journal of Automotive Technology and Management, 2011 Vol.11 No.2, pp.189 - 204

Published online: 07 Apr 2011 *

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