Almost 150 years after the American Civil War the struggle to save the country’s carmaking industry is once again becoming a battle between the Union and the Confederacy.

In this latter-day renewal of hostilities the union is the United Auto Workers (UAW) whose members are mostly employed in Northern states such as Michigan, the traditional heartland of US motor manufacturing.

Union leaders have bitterly denounced Republican Senators from the South for scuppering a $14 billion bailout package for General Motors (GM) and Chrysler which, along with Ford, make up Detroit’s “Big Three”.

Many of those who voted against it represent former Confederate states where foreign-owned car plants have sprung up in recent years and are proving to be more competitive than America’s domestic manufacturers.

Those opposing the bailout included Richard Shelby of Alabama, which has benefited from investment by Honda, Hyundai and Mercedes-Benz; Senate Republican leader Mitch McConnell, who has a big Toyota plant in his state of Kentucky, and Bob Corker of Tennessee where Nissan and Volkswagen have provided thousands of new jobs in recent years.

Jim DeMint of South Carolina, where a new BMW factory has been built, even gave warning that “we’re going to have riots” if more money was spent rescuing the carmakers in the North. “There are very few companies that aren’t hurting and they’re going to hurt. We don’t have enough money to bail everyone,” he said.

The UAW says that a double standard has operated by which the South has attracted investment from foreign car companies, with more than $3 billion of state subsidies since 1992 — while denying help for the North.

Brian Fredline, who is head of the UAW branch in Lansing, Michigan, said: “This is almost like Confederate senators fighting against the Union Army of the North. The parallels are frightening, and it’s almost this mentality that the South will rise again. They hold hostage the economic recovery of anyone who lives north of the Mason-Dixon line.”

Reprisals have already begun. Kentucky’s Republican Senator Jim Bunning, who was once a baseball star in Detroit, was abruptly uninvited from appearing at an event for fans in Michigan at the weekend as punishment for voting against the bailout. And a retired GM engineer last week started a website urging a consumer boycott of Alabama until Mr Shelby is replaced by a senator “who has America’s best interest in mind”.

Michigan’s Democratic Governor, Jennifer Granholm — who is an economic adviser to Barack Obama’s transition team — has joined the clamour against Southern Republicans. “The Republicans in the Senate have been protecting the Republicans within their borders,” she said. “They are not acting as Americans.”

Mr Shelby has denied wanting to destroy industry in the Yankee North to help foreign-owned plants in his state. “No, no, no — failure is never a good thing for anybody,” he said. “If I had five GM or Ford plants in my state, I would oppose this bailout.”

Yesterday Mr Corker said that Capitol Hill negotiations on the rescue deal had been wrecked by the UAW’s refusal to accept the imposition of costcutting measures that would have forced the carmakers to operate on the same labour costs as the foreign-owned companies. He dismissed suggestions that self-interest had influenced his position, pointing out that he also had a GM plant in Tennessee which is “very important to my state”.

Indeed, industry experts say the supply chain is so intertwined that the disappearance of any one the Big Three would affect carmakers in the South. David Cole, chairman of the Centre for Automotive Research, said: “You can’t separate them at all. Because of the tightly knit web of suppliers, a failure of a GM or Ford would take the supply base down for a considerable time.”

The foreign-owned manufacturers have so far remained silent on the fate of the bailout package, except to point out that they regard themselves and their workers as part of fabric of the modern American industry.

Much of the cost advantage they enjoy is explained by having been in business for less time than their US-owned counterparts who are saddled with multi-billion dollar obligations to retired workers. Many of them have also strongly resisted union recognition at their plants, prising loose the grip that the UAW has long held over the car industry. Ron Gettelfinger, the president of the union, claimed last week that the Senate Republicans had been seeking to break the UAW. “They thought perhaps they could have a two-fer [two for the price of one] here maybe,” he said — “pierce the heart of organised labour while representing the foreign brands.”

Times Recommends

• Google to digitise Iraqi artefacts
• Renault angers parents by naming new car Zoé
• Analysis: most lawless part of Philippines