GM, In Context

Economics 21 counts the challenges facing the company:

Part of the longer-term problem facing GM and the U.S. automobile industry more broadly is that while automobile sales in emerging economies are increasing robustly, they are decreasing in the mature economies of Europe, North America, and Japan. Aging populations, deleveraging households, higher gasoline prices, denser metropolitan areas, and the advent of sharing platforms like Zipcar have dampened demand, and many if not all of these trends are likely to accelerate. We can expect governments throughout the industrialized world to continue subsidizing “national champions” in the automotive sector, creating a powerful beggar-thy-neighbor dynamic that could badly undermine free trade. As this dynamic unfolds, the U.S. will be in no position to lecture its trading partners.

(Hat tip: Reihan)