General Motors, Ford, Chrysler: collectively, they've long been known as the "Big Three" automakers that have been among the continent's biggest and healthiest car companies for decades. No more.

These days, the Big Three just aren't as big.

In fact, after the stunning death of a financial assistance bill in the U.S. Senate on Dec. 11, 2008, they might be headed to outright pygmy-like stature.

The automakers were only getting $14 billion US in new cash — less than half of what they were seeking. And the failure of legislators in Washington to pass this pared-down help package could mean the public's appetite for extending tax dollars to the auto sector is not just questionable; it might be non-existent.

That in turn means these car companies are still spinning their wheels in very hard times as their market shares in Canada and the United States steadily lose ground to Asian-based automakers. Consider the following recent developments:

General Motors Corp.: The biggest of the domestic North American automakers, GM saw its October 2008 sales drop 45 per cent compared to the same month in 2007. The company has lost $73 billion US since 2004, the last time it turned a profit.

Starting in July 2008, it cut up its white-collar workforce and sped up production cuts announced the previous month, when the automaker announced it was closing a truck plant in Oshawa, Ont., affecting approximately 2,500 workers. Three other truck plants in North America would also shut, the company said. The news came just weeks after the closure of a transmission plant in Windsor, Ont., that affected 1,400 workers. The job cuts followed the 30,000 layoffs announced in 2006 as part of a major restructuring.

More recently, General Motors Canada said it will cut another 700 jobs at its Oshawa facility by February 2009.

Ford Motor Company: Ford, for many years the No. 2 automaker, fell to No. 4 behind Toyota and Chrysler in January 2007, as its U.S. sales continued to decline. Ford lost a breathtaking $12.7 billion US in fiscal 2006 and was $2.7 billion in the red for 2007. Ford said it would cut 15 per cent of its salaried workforce costs, or around 2,000 employees, by Aug. 1, 2008. It also said it was cutting back on truck and SUV production. The restructuring followed a January 2006 announcement of as many as 30,000 job cuts and the closure of 14 plants, including the Windsor, Ont., casting plant.

Lately, Ford idled its Russian plant, partly as a result of that country's financial crisis and partly because of falling sales in that country.

Chrysler LLC: The American car company split with its German partner Daimler AG in 2007. While the maker of Mercedes Benz is keeping its head above the financial waves, Chrysler is now staring at a merger with General Motors at best and bankruptcy at worst.

In February 2007, it announced 13,000 job cuts — 2,000 in Canada — along with the closure of two U.S. facilities and shift reductions at two others.

By fall, Chrysler had cut another 1,800 positions and was looking to reduce 5,000 more positions throughout the buyout route.

Earlier in the year, Chrysler shut a plant in a Ohio and announced a target of 13,000 job reductions. Chrysler Group, the North American division of the company that Cerberus Capital Management bought in mid-2007, lost $680 million US in 2006. Like GM and Ford, it has announced production cuts.

Besides the travails of the continent's three domestic car producers, overall sales to Canadians and Americans fell in November, down 36 per cent compared to the same month in 2007. The sector is on pace to sell 10.3 million units, one of the lowest annual figures on record.

As recently as 1998, the combined market share of the Big Three in Canada and the U.S. was 70 per cent. Just 10 years later, that share had skidded to 47 per cent in both countries.

How did Detroit automakers lose so much traction?

Analysts cite many reasons for Detroit's woes. Many of them come down to two things: labour costs and product.

First, a look at the product side. North American automakers made a big commitment to large sport utility vehicles in the 1990s. For a while, that was the segment that was selling. But SUV sales peaked in 1999 and have been sliding since.

The gasoline price surges in the second half of 2005 hurt sales of large SUVs even more. This continued into April 2008, as gas prices inched closer to $4 a gallon in the U.S. Year-over-year sales of trucks dropped 17 per cent, while large SUVs plunged by 29 per cent.

Japanese automakers, long perceived as the leaders in the smaller, fuel-efficient vehicle market, aren't nearly as dependent on SUV models. While Detroit was rolling out one giant SUV after another, Japan was busy churning out gas-electric hybrids.

Other industry observers say Detroit has also taken too long to bring more new and redesigned vehicles to market — too long to bring back the buzz, as it were. It didn't help matters any for Detroit when Honda's new Civic and its first pickup truck, the Ridgeline, were named car and truck of the year at the 2006 North American International Auto Show. The Civic is made at Honda's plant in Alliston, Ont.

Falling sales and falling market share have meant that plants have been operating below capacity. For instance, GM's plants were reported to be operating at 85 per cent capacity in November 2005, well below the plants of its Asian competitors. Hence the production cuts, plant closures and layoffs.

All North American automakers cut prices on their vehicles in 2005 (the so-called "employee pricing" discounts). While these incentives did boost sales while the promotions were on, they also cut further into profits. Japanese automakers haven't had to offer big discounts because their sales haven't needed a boost.

There's also the issue of perceived quality and reliability. In the past, Japanese automakers scored much better in initial quality ratings than North American nameplates. That's not as true any more. GM and Ford models have sometimes beaten Japanese models in recent surveys by J.D. Power and Associates. In fact, GM's Oshawa No. 2 plant was ranked as the best vehicle assembly plant in North America in 2005 in terms of initial quality. But getting the car buying public to realize that hasn't been easy.

Analysts usually cite labour costs — especially U.S. health care and pension costs — as another big reason why the U.S.-based automakers are having problems. GM, for instance, at one time picked up the entire cost of funding health insurance premiums of its employees, their survivors and GM retirees. Those costs have gone through the roof in the past few years, rising at double-digit rates every year. A recent agreement with the UAW will allow GM to trim billions from its annual health-care bill. But the non-unionized Japanese automakers, with their younger American workforces (and far fewer American retirees) will continue to enjoy a cost advantage.

The issue of labour productivity is also cited by many. The 2005 Harbour Report estimated that Toyota's lead in labour productivity amounted to a cost advantage of $350 US to $500 US per vehicle over North American manufacturers.

What does the future hold?

In the short term, stick-handling an aid package through the U.S. Congress is the Number 1 priority of the Big Three. But, after a committee appearance to which executives took company jets, these auto execs have not shown a great ability to play the Washington political game.

Worse still, even if they get the $14 billion, Chrysler, Ford and GM still have their restructuring work cut out for them.

No one knows better than the Detroit automakers themselves that changes are necessary. They're now busy introducing more fuel-efficient vehicles. So-called CUVs — car-based crossover vehicles — are the fastest-growing vehicle segment, with 41 models now available in the North American market.

That's good news for the Canadian auto industry, Scotiabank economist Carlos Gomes says. "We estimate that Canada produces about one-third of all CUVs assembled in North America [at Ingersoll, Alliston, Cambridge and Windsor, all in Ontario] — more than double its share of total vehicle production." Ford's Escape is the biggest-selling CUV, but here again, the Japanese have an overall lead. Imported brands have a market share of almost 60 per cent, according to a recent analysis by Scotiabank's Canada Auto Report.

As highlighted above, GM and Ford have embarked on major restructuring — announcing major plant closures and job cuts in a bid to slash production costs and return their North American operations to profitability. Both automakers have also secured wage and benefit concessions from the UAW. But the time when automakers could rely on their highly profitable large SUVs to carry them through rough times has clearly vanished.

Will GM and Ford be able to turn it around? The automakers, of course, say yes. Analysts say they'll need to chop vehicles, models or brands that are unprofitable (much as GM announced the phase-out of its Oldsmobile brand in 2000). They'll also need to modernize an outdated dealer network and boost investment in their remaining plants and products.

As part of that investment, GM announced a $2.5 billion program in March 2005 to upgrade plants and boost research and development in Ontario. In November 2005, Chrysler said it would invest $768 million to upgrade and modernize its Ontario operations.

And, as industry aficionados gathered in Detroit for the 2007 North American International Auto Show, GM announced it was working on a lithium-ion battery that would significantly boost the gas mileage of hybrid sport utility vehicles such as the Saturn Vue Green Line.

Meanwhile, Canadian and American automotive journalists chose Saturn's Aura and Chevrolet's Silverado as the car and truck of year. The Aura beat the Honda Fit and Toyota Camry for the award. The Silverado was picked over the Ford Edge and Mazda CX-7 crossovers.

The honours have been handed out annually since 1994. Japanese and European brands have taken top marks seven times. With the 2007 wins, North American carmakers have also come out on top seven times.

But the Big Three's struggles are far from over. Economic headwinds remain strong as consumers get the jitters from volatile stock markets, a major slump in U.S. housing, mounting foreclosures, tighter restrictions on credit and soaring gas prices. As for the Asian-based automakers, they'll be busy trying to make further inroads into the North American market — a market they had no share of just 40 years ago.