the American auto industry's Big Three did not prevent smaller manufacturers from industrial failure from the 1960s through the 1980s (e.g., Studebaker, American Motors). In part that is attributable to successful Japanese and European competition in the US market during that period. However, the American auto industry has a longer history of trouble.
Unionization was an auto-industry issue from its inception, but not until 1935 were employers prevented from firing union workers at will. What began in 1936 as an attempt by the United Mine Workers to organize unions in the steel industry escalated into what became known as the Big Strike, first against General Motors, where workers staged a sit-down strike and occupation of various assembly plants in Michigan and Ohio, and then against Chrysler and Dodge. Membership in the United Auto Workers (UAW) zoomed from 30,000 in 1936 to 400,000 by the end of 1937 (Leuchtenburg, 1963). Ford, which had a history of employing strikebreakers and firing union organizers, was last to recognize the UAW, in 1941 (Norwood, 2002).
The Detroit auto manufacturers employed what amounted to private armies to either spy on (and thus have fired) or intimidate union organizers in auto factories. The philosophy was to dismiss workers desiring to organize so as to keep the mass of workers in line, and the most notorious strikebreaker, a former prizefighter called Harry Bennett, was employed in Ford's "Service Department" (Norwood, 2002). Bennett recruited a private army for spying and strikebreaking purposes, but the Detroit police department and court system were notoriously antiunion as well
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