Meltdown 101: Foreign automakers struggle too

Q: Aren't fuel-efficient cars like the Toyota Prius still hot sellers?

A: Actually, Toyota recently shelved plans to build the hybrid at a new factory under construction in Mississippi. Sales of the Prius, which gets 46 miles per gallon on average, sank when the price of gasoline plummeted from the $4-a-gallon range it reached this past summer.

Q: Is the United States the only country forking over large amounts of money to bail out an auto industry?

A: Bailouts are popular topics in many countries. Sweden's lawmakers have approved an aid package worth $3.6 billion to prevent a collapse of its auto industry.

Canada just approved emergency loans valued at $3.29 billion to support Canadian subsidiaries of the Detroit Three automakers.

British carmakers also are pressing their government for a bailout, and GM Europe officials have met with German Chancellor Angela Merkel to ask for loan guarantees.

Q: Will the bailout for U.S. automakers give them an unfair advantage competing against their foreign counterparts?

A: Not at all. Cole thinks it will help level the playing field a bit.

He noted that foreign automakers who sell cars in the United States already receive a big helping hand in their home countries, where the cost of health care and pensions often is absorbed across the whole country. Here, companies have to eat those costs all by themselves.