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Thursday, April 13, 2006

Driving Straight for a Cliff

When I was a kid, the 'car of the future' always had similar features; it had big fins, a glass bubble dome roof, and an atomic engine. How the times have changed.

There's a train of thought running through the US auto industry. I can't decide whether it's stupidity or delusion, so I'll split the difference - it's delusional stupidity. Automakers are looking to the future and seeing SUVs - despite gas prices.

The Wisconsin State Journal had this headline in the business section, "GM hangs rebirth on Janesville SUVs". They report, "The company, which reported an $11 billion loss for 2005, hopes such high-margin large sport utility vehicles will be a key part of its turnaround. But other automakers, prompted in part by high gas prices, are emphasizing smaller SUVs and cars."

Agence France Presse has this, "Americans will buy SUVs even if gas hits four dollars a gallon: Ford":

""There is a certain portion of the marketplace and customers who want that flexibility that is provided with a traditional SUV," Mark Fields, president of the automaker's Americas division, said during a conference with analysts.

"So I don't think our strategy would change too much.""

I reported this Gallup poll earlier, but it makes sense to repeat it here - "Roughly half of Americans report economizing in order to compensate for the increase in gas prices over the past year. About half say they have cut back significantly on the amount they drive. Separately, a slim majority (54%) say they have reduced their household spending on other items. Most Americans say they would consider buying a hybrid car when making their next car purchase."

In terms of global warming, dependence on foreign oil, and global competition, SUVs are dinosaurs. You don't see any atomic cars these days, so I'm guessing the predictions for the SUV's future are as accurate.

(Keywords: energy, transportation, business, financial, selling buggy whips )

1 comment:

BenMerc said...

It's true...if enough "folks" buy hybrids and take to their trail bikes etc...there will be enough gas for the piggies.

I am figuring with all my other cost of living increases, as gas goes up I will be religated to just driving for work. I think we are all about to really find out what it means to be "working class".

A part of me has wished for high gas for some reasoning being it may spur the alt energy movement. But I fear a stale mate will occur if we have a depressed economy, and nothing gets done as the rich bide their time.

GM is pathatic and totally irresponsible, these people have to keep relearning the same lessons over and over. Please tell me how in the hell did that much stupid get to be so big?