The auto industry is in some serious trouble and bankruptcies are a definite possibility. Attorneys speculate that General Motors Corp. may be heading down that dark road, resulting in legal fights about union issues and consumer warranties.

“If a General Motors bankruptcy leads to manufacturing plant closings or a scaling back of production, a wave of bankruptcies is likely to follow,” reported lawyers.

According to Evan D. Flaschen, a Hartford, Conn., partner at Houston’s Bracewell & Giuliani, “the ripples will be profound.”

With the big auto industry financial disaster, small businesses will feel the effects. Those who sell products and services to the big guys including restaurants and corner stores will suffer greatly.

Stated The National Law Journal, “after the U.S. Senate on Dec. 11 failed to approve a $14 billion automobile industry bailout approved by the U.S. House of Representatives on Dec. 10, the White House hinted that it may consider using the Troubled Asset Relief Program (TARP), which could funnel up to $700 billion to financial firms under the Emergency Economic Stabilization Act.”

Stay tuned…

Popularity: 4% [?]