The geography of auto globalization and the politics of auto bailouts

Abstract

The global financial crisis had dramatic impacts on auto manufacturing worldwide. However, these were felt uniquely severely in North America, largely because of its asymmetric position within the geography of automotive globalization. North American automakers were already fragile due to one-way trade and foreign direct investment inflows. This history also shaped the nature of the North American policy response. Unlike other jurisdictions, North American governments needed to save leading regional producers from liquidation. Moreover, this rescue took on a unique anti-union tone, through government-mandated renegotiation of labour contracts. The measures taken in North America, while dramatic, are unlikely to resolve the continental industry's deeper structural weaknesses. © 2010 The Author. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.