Friday, June 13, 2003

Trouble ahead for the Motor City

The Economist thinks America’s automotive industry is heading for a breakdown in “Extinction of the Car Giants

MOTOWN is celebrating. One hundred years ago Henry Ford set up in business, and America's love affair with the automobile began. Ford is staging a party that would not have disgraced Jay Gatsby. And why not? The American car market has been roaring, with annual vehicle sales over 16m. It could be close to 20m in a decade's time, with another 26m young Americans clamouring for their first set of wheels.

Yet the ride is not going to be smooth: it will be more like cruising in a Ford Thunderbird while ignoring a nasty rumble from its mighty V8 engine. For all the signs are that things are going badly awry in Detroit. Unless something changes, the industry could go broke—with Ford, the most troubled of the big three carmakers, leading the way (see article). The 100th birthday party could swiftly be followed by a wake


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