My co-blogger Arnold has an excellent blog on the auto industry. There's more to say, though.
Notice his first quote from Obama:
The auto industry is the backbone of American manufacturing and a critical part of our attempt to reduce our dependence on foreign oil.
Whether or not the auto industry is the "backbone" of American manufacturing--I think it's not--the second part of his sentence is simply incorrect. Even if one accepts as given that we should reduce our "dependence" on foreign oil, the way we'll do that is by using less oil. This has nothing to do with where the cars are produced or which company produces them. It has nothing to do with whether the cars that use less gasoline were produced in the United States or Japan or Korea or Germany.