TRAVERSE CITY -- The swirling uncertainty that grips Michigan's major auto companies is generating plenty of fallout in northern Michigan.
Local auto parts suppliers watch helplessly as orders dwindle, while area car dealers struggle with a quickly souring economy and fret about their major vehicle suppliers' futures.
Even auto industry veterans well-versed in ups and downs acknowledge the present business climate is like nothing they've experienced. And with a federal bailout of Michigan's Big Three now in limbo in Congress, a possible bankruptcy of one or more of the U.S. auto makers would cloud their outlook even more.
"It would make our job trying to retail vehicles that much more difficult, no question about it," said Jamie Marsh, co-owner of the Bill Marsh Automotive Group in Traverse City.
A research piece generated this month by the Center for Automotive Research projected the economic impact of a potential contraction of the Big Three automakers. The center, which holds an automotive seminar each summer at the Grand Traverse Resort & Spa, estimated that if one or more of Ford, Chrysler or General Motors failed next year, it would create a loss of nearly 2.5 million jobs in the U.S.
Those figures include almost 800,000 jobs at direct or indirect suppliers, and more than 1.4 million in spin-off jobs from the auto industry.
The estimated loss of personal income would total more than $125 billion in the first year, and more than $275 million over three years.
Locally there are around 1,200 auto-related manufacturing jobs in the 5-county Grand Traverse area, according to estimates from the Traverse City Area Chamber of Commerce. There are also close to 570 jobs related to retail auto sales, officials said.
Bankruptcy for any of Michigan's automakers would have "serious implications" for pension funds and health care benefits impacting tens of thousands of Michigan residents, as the Big Three is responsible for the health care of an estimated two million employees, retirees and their dependents. Various governments could stand to lose $60 billion in the first year following a contraction, the center estimates.
In today's Business section, area car dealers and suppliers talk about the challenges of dealing with the economic tsunami battering the auto industry, and how they hope to ride out the turbulent times.
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