More From Our Geographers

One big trend we see internationally is the rapid growth of the auto industries in Asia -- particularly China and India. China has gotten more publicity recently but both are red-hot car markets. All the major actors are in there, in China and India. Not building very many cars right now -- they are losing money -- but they are in there for the long haul.

GM, Ford, Toyota, Honda, plus the major European carmakers, are all players in the car markets of India and China. Both the Indian and Chinese governments have cut deals with the carmakers that include subsidies to build up the car markets. So most carmakers feel that globally what will be hot in the 21st Century will be the car markets of China and India. So in that sense it doesn't really matter whether you have a plant in Kentucky or Michigan when the market that is really hot is many thousands of miles away.

Another big trend of the 21st Century is consolidation. While there are a large number of brands right now, increasingly these brands are owned by a handfull of companies. Many of the independent companies of Japan, Korea and Europe are disappearing as independent companies. They really are operating as subsidiaries of the few big companies.

By the year 2010, I would expect that 90% of world auto production will be in the hands, effectively, of a half a dozen companies -- although they may still be selling under a wide variety of brand names.

The global survivors will be Honda and Toyota from Japan, Ford and GM from the U.S. Daimler-Benz, Volkswagen and maybe one or two others from Europe.

Here Geographer Rubenstein addresses NAFTA's impact (much ado about nothing).

In the 1990's, a lot of people were concerned about the impact that NAFTA would have on the U.S. auto industry, as well as other industries. There was a sense…in Canada, Mexico, and the U.S. alike that NAFTA was going to have a lot of negative impacts on their auto industries -- and that seemed a little illogical -- that is, how it could have negative impacts on all three countries. What has happened since the 1990's is something of an equilibrium. There has been a sense in the auto industry that anything that was going to Mexico has long since gone to Mexico -- a little bit is coming back and Mexico is now in equilibrium. The U.S. carmakers build some cars in Mexico for the U.S. market and some for the Mexican and the South American markets, and certainly more cars come into the U.S. than out, but we've reached a rough equilibrium between the U.S. and Mexico on one hand and the U.S. and Canada on the other hand.