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Obama’s Vision for Auto Industry Tested by Economy, Gas Prices

obama1.jpgPresident Bush recently announced the terms of the $17.4 billion in assistance for the auto companies, but President-elect Barack Obama issued a stern warning that “The auto companies must not squander this chance to reform bad management practices,” New York Times reports.

The incoming Obama administration has a vision for an energy-efficient auto industry. Obama has said he would provide up to $3 billion to Detroit auto companies and their suppliers so they can retool their factories to produce smaller and more fuel-efficient vehicles. But with gasoline prices dropping again, it is unclear whether consumers will want smaller cars.

In addition, Obama may have to make compromises in pursuing an energy-efficient auto industry because he must juggle other priorities like boosting the broader economy.

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