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From tail fins to hybrids: How Detroit lost its dominance of the U.S. auto market

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  • Thomas H. Klier

Abstract

This article explores the decline of the Detroit Three (Chrysler, Ford, and General Motors). The author identifies three distinct phases of the decline?the mid-1950s to 1980, 1980 to 1996, and 1996 to 2008?culminating in the bankruptcies of Chrysler and General Motors in 2009. In showing how the U.S. auto industry has evolved since the mid-1950s, this article provides a historical frame of reference for the ongoing debate about the future of this industry.

Suggested Citation

  • Thomas H. Klier, 2009. "From tail fins to hybrids: How Detroit lost its dominance of the U.S. auto market," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 33(Q II), pages 2-17.
    • Handle: RePEc:fip:fedhep:y:2009:i:qii:p:2-17:n:v.33no.2
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    File URL: http://www.chicagofed.org/digital_assets/publications/economic_perspectives/2009/ep_2qtr2009_part1_klier.pdf
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    References listed on IDEAS

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    1. Kwoka, John E, Jr, 1984. "Market Power and Market Change in the U.S. Automobile Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 32(4), pages 509-522, June.
    2. White, Lawrence J, 1972. "The American Automobile Industry and the Small Car, 1945-70," Journal of Industrial Economics, Wiley Blackwell, vol. 20(2), pages 179-192, April.
    3. Martin N. Baily & Diana Farrell & Ezra Greenberg & Jan-Dirk Henrich & Naoko Jinjo & Maya Jolles & Jaana Remes, 2005. "Increasing global competition and labor productivity: lessons from the U.S. automotive industry," Proceedings, Federal Reserve Bank of San Francisco.
    4. Thomas H. Klier, 1994. "The impact of lean manufacturing on sourcing relationships," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 18(Jul), pages 8-18.
    5. Thomas H. Klier & Joshua Linn, 2009. "The price of gasoline and the demand for fuel economy: evidence from monthly new vehicles sales data," Working Paper Series WP-09-15, Federal Reserve Bank of Chicago.
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    Cited by:

    1. Thomas Klier & James M. Rubenstein, 2013. "Restructuring of the U.S. Auto Industry in the 2008-2009 Recession," Economic Development Quarterly, , vol. 27(2), pages 144-159, May.
    2. Manuel E. Sosa & Jürgen Mihm & Tyson R. Browning, 2013. "Linking Cyclicality and Product Quality," Manufacturing & Service Operations Management, INFORMS, vol. 15(3), pages 473-491, July.

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