Wednesday, March 18, 2009

Chaos Theory and the Big Three

Edward Lapham at "The Auto News" raises an interesting question. Could the bankruptcy of a small parts supplier set off a ripple effect that takes down the Big 3 automakers? I don't like the analogy with pre-WWI Europe, but the result could be comparable - someone small (possibly even a Tier-2 supplier) getting in trouble, setting in motion a progressively larger chain of events. Suppliers to the Big 3 (and the Big 3 themselves) have been under tremendous pressure the last decade (and more) so the current downturn is even that much worse.

Keep your fingers crossed. All economies do not take well to sudden changes, so if anyone in Detroit were to disappear, it would be better if they would just fade away.

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