10/23/2008 05:12 am ET Updated 4 days ago

Green "Correction" in Auto Sector Leaves GM Clinging to Government Loans


To adopt some financial lingo being bantered about quite a bit these days, the green "correction" to the U.S. auto industry is in full swing. GM leading man Mr. Fix-It Bob Lutz sums up the pain thus -- that the auto industry was faced with three simultaneous crises:

1) mortgage crisis

2) soaring gasoline prices (doubling over 24 months) that wiped out the pickup truck and sport utility vehicle market (mission accomplished, TreeHuggers -- sort of*)

3) governments creating new, stringent targets for fuel consumption instead of a gradual transition via increasing gas taxes in order to change consumer behavior

In fact, GM does very directly see itself in a similar sinking ship as the the finance industry, and likewise in need of a life raft.