The last recession forced the auto industry to slash costs, shutter factories, tear up contracts and rely on government funding.
Now the what-if question for increasingly bullish investors convinced the worst is behind for the battered sector: What's the industry's playbook for a possible double-dip?
Global auto sales tumbled 13 percent in 2009 to hit a seven-year low in a collapse that forced both General Motors Co and Chrysler into U.S.-government funded bankruptcies.
But since the middle of last year bond and stock investors have bet that stronger suppliers like TRW (TRW.N) and survivors like Ford Motor Co have turned the corner.
That bullish consensus hinges in part on the assumption of strengthening auto demand in the second half of 2010 in the U.S. market, now the second largest behind China.
"From an auto industry point of view, we are still in a depression," said Jeremy Anwyl, chief executive of auto tracking service Edmunds.com.
Analysts say another downturn could delay or scuttle plans to reduce the reliance of GM and Chrysler on government financing in a blow to the plans of the Obama administration.
It would also imperil Ford's plans to pay down its debt and draw Asian automakers led by Toyota Motor Corp (7203.T) into an even deeper price war through incentives in order to keep inventories from rising, analysts say.
"The GM IPO gets put way back on the back burner," said George Magliano of IHS Global Insight, in the event of a return to recession.
The last U.S. recession began in late 2007 and ended in the middle of last year in the view of most economists.
Meanwhile, U.S. auto sales are forecast to recover to around 11.5 million to 11.8 million for 2010, up from an anemic 10.4 million last year, the lowest total in 27 years.
During the first quarter, U.S. auto sales were running just short of 11 million vehicles on an annualized basis.
Another recession in the near-term would delay GM Chief Executive Ed Whitacre's plans to reduce the 72.5 percent U.S. and Canadian government ownership in GM through an IPO.
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