Massive government subsidies, protectionist rules and direct-equity investments by governments have resulted in past and present unfair cost and tax advantages for foreign automakers. The playing field is not balanced, and with government subsidies for foreign vehicle makers -- including both direct subsidies and indirect investments made by foreign universities in research institutions, for example -- U.S. vehicle makers can hardly be accused of squandering any competitive advantage. Indeed, American vehicle makers have never stood much of a competitive chance in the global market.
No free market actually exists in the automotive sector -- never has, never will. Add to this local vehicle homologation (European Union and Pacific Rim) and protectionist rules that make exporting a substantial number of U.S.-built vehicles to foreign markets a pipe dream. Furthermore, currency manipulation by foreign governments results in another unfair advantage in favor of overseas vehicle makers. Taking all this into account, you can see where U.S. automakers are today.
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