U.S Automotive Industry crisis

Amidst the global financial crisis, during the latter half of 2008 , an automotive industry crisis developed. Although it primarily affected the United States and Canada, because of the Automotive Products trade Agreement, it stretched itself and went on affecting the automobile manufacturers in Europe and Japan as well. There are multiple causes responsible for such a depression being developed. Let us go into analysis and find out more :-
1. Political Demands:
A letter was sent to the CEO s of the Big-Three (General Motors, Ford and Chrysler) by Nancy Pelosi and Harry Reid(both belonging to the Democratic Party) calling them to devise a plan that would restructure their business concepts and sacrifice major resources. The time allotted was also too short to manage and resolve such critical issues which messed up everything.
2.Volume of laborers:
A survey by the Alliance for American Automobile Manufacturing reported a total 1.6 million people involved in the Big-Three of the U.S automobile industry , as employees , vendors and dealers. The total magnitude sums up to a lump-sum of 3.1 million in the whole U.S automobile industry. Thus, a huge cost has been going in for supporting such a huge labor base.
3. Costs to Jobs:
In 2005 it was surveyed and published by Detroit News that the Big-Three paid wages to almost 12000 workers who were idled due to technological advancements. Such was a compulsion on the manufacturer's part as the UAW formed a program in 1984 which protects the labor interests and benefits.
4. Brand Numbers:
In comparison to Toyota's three brands , GM rums eight brands which involve huge costs as separate brands require specific branding, advertising and expenses of product development. This is again a major cause for the developed depression.
5. Dealer Numbers:
An estimated amount of 500,000 people work for about 10,000 dealerships shared between GM and Chrysler. However, if a cut-down is intended on the number, it would involve huge expenses as dealers are protected through State laws. Such a reformation is extremely challenging without a bankruptcy declaration.
6.Merging the "Big-Three" :
Such an effective proposal to save the industry was totally rejected due to the influential opposition coming from the UAW and CAW. The reason to oppose was the fact that it would have involved huge employee layoffs.
7. Crisis of Capital:
GM is indebted with $43 billion, thus, if share holders swap their stakes for equity, the burden shall be substantially reduced. Thus, the Big-Three are in a critical situation and shall be even more penalized if such factors are not countered through bankruptcy declaration or plant-shut down. A bankruptcy declaration would hopefully provide a financial bail-out by the Federal Government and thereafter organizational and management re-structuring shall better the situation and the U.S economy as a whole.