By the time you read this, the knife-edge existence of the Big Three automakers will have been decided, one way or another, by a reluctant Congress. Bailout or bankruptcy seem at this writing to be the only options, and American automotive manufacturing will be forever changed by whatever direction Congress chooses.
Regardless of the outcome, a look at what France did with its perpetually ailing national computer manufacturer, Groupe Bull, might be instructive, if unfortunately so. Bailing out fundamentally bad business models has lots of risk. In the case of Groupe Bull, rarely has so much good money been thrown at a losing business model with such mixed results.
Nationalized in 1982 and privatized again 12 years later, Bull remained in business those 12 years despite ineffective product development and marketing. And during its period of nationalization, Bull's ability to compete in the global market was severely hampered by a strict allegiance to French labor law, which made it impossible to implement the kind of cuts that are fairly standard in American high-tech companies when the red ink starts to flow.
What was most dramatically wrong with this picture was that Bull was never competitive on the product side. Its servers and workstations had a me-too quality, and its product development and marketing were simply not up to fighting off American companies such as Sun, Digital Equipment, and IBM. The billions of francs pumped into Bull never really enhanced the company's ability to compete.