To address concerns that customers might not buy from shaky domestic auto companies, the government will step in and guarantee all of their warrantees.
Bank when there was talk of GM (GM) and Chrysler going bankrupt, this issue was constantly being talked about, and many people insisted that there was no way consumers would buy cars from a bankrupt manufacturer for precisely this reason.
It still doesn’t sound like they’ll be let to go bankrupt anytime soon — the bondholders will take a serious haircut before that — but as a practical decision, this seems smart enough.
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