The economy of America plays a vast role in the success of its industries. The automotive industry is largely subjective to the fluctuations in the financial stability of the American Economy. Many American automotive companies like General Motors and Chrysler have found themselves in financial difficulties, due to the recession. The economic status of America has a large effect on the government which greatly affects the automotive industry. Just as the economic status effects industry, the industry itself has a tremendous effect on the economy. The economy and the industry offer many benefits to one another, it is difficult to decipher which is more influential.
The Recession of 2007-2009
The recent recession in the United States had a significant consequence on certain American automotive companies. Companies like General Motors (GM) and Chrysler have been forced to file for bankruptcy due to losses in the recession. The economy’s downfall has proved to be fatal in terms of profits and employment all over businesses in the United States. But the recovery of these companies has had an effect on the economy. When Chrysler filed for bankruptcy in the Federal court, President Obama stated that the bankruptcy filing is not a failure for the company but "one more step on the path to Chrysler's revival” (Chrysler). The president said that the process of Chrysler’s bankruptcy would be “quick and controlled”, (Chrysler). This shows that government was to be involved in the bankruptcy of Chrysler and other companies. This in turn would be a spark of effects on the automotive industry and the economy of the United States. The unemployment rates of the country would be negatively affected on a large scale.
It was apparent that the failur...
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