GM, Ford and Chrysler could create over 3,000,000 unemployments if they go bankrupt

The three giants in the auto-industry, General Motors, Ford and Chrysler, have requested a $25 billion aid from the government due to the crisis.

"General Motors, the largest US auto-maker, probably has weeks and not months before it runs out of money without federal aid" said Jerome York, a former GM board member. "GM can't continue to operate until a new U.S. administration takes over in January," he added.

Richard Wagoner, GM's President, stated that the bankrupcy of these three companies could lead to 3million unemployed around the world and a reduction of governments tax collect of more then $150billion.

"A GM collapse would mean more aid to specific states like Michigan, Ohio, and Indiana, and more money into unemployment and extended benefits,'' said Nariman Behravesh, chief economist at IHS Global Insight Inc.

"A GM shutdown would wipe out jobs among suppliers as well as at the automaker itself, pushing the U.S. unemployment rate next year to 9.5 percent, compared with current projections of as high as 8.5 percent" Behravesh said.

This means that unemployment in the US could go 1% higher then originally estimated. This is a very worrying situation which is worsened by the crisis as the newly unemployed find it virtually impossible to find new jobs.