Fuel Mandates Are the Root of Automakers' Problems

Gee, some of us were not born yesterday.

I take it that you are one of those guys that the auto manufactures pay to troll the community forums in an effort to up grade their image.

They lobbied against CAFE and got it delayed, while they sold millions of four wheel drive station wagons.

Which of course made the most money and sucked the most gas.

Meanwhile, the Asians were working on high mileage vehicles.

And yet you are here to tell us about the auto manufactures problems.

Get real.

The real trouble with America's automakers comes not from a lack of "bailout," but Congress' fuel-economy mandates.

This is utter and total gibberish. CAFE has been in place for many years, and the future changes are monumentally slow. You'd need to supply a lot of data to show that the auto makers have spent billions on developing hybrids and that it is this spending that has put them in their current fix. Honda and Toyota actually have spent billions on developing fuel efficient vehicles and both are in far better shape than the American companies. GM has always been adept at gaming the CAFE rules, and will continue to be adept at doing so, if they stay in business.

Visit some dealerships to see what people are buying. If you find that SUVs are flying off the lots and that the small cars that "they know the public won't buy" are just sitting there gathering dust, then you'd have some support for your contention. Perhaps you should think about opening a Hummer dealership.

When I read a blurb like this it makes me cringe and pucker up, which makes me think of J.D. Power's ratings which make me cringe and pucker up anew.

Pure and unadulterated BS.

I just visited the local Pontiac/GMC/Cadillac Dealer looking for a 2nd car (used) and 95% of the new cars were Pickups, SUVs, 4 wheel drives, and those monsterous Cadillacs. Very few small cars were evident.

The evidence of change was definitely lacking.

The salesman should have been on the old US TV show HeeHaw in the Junior Samples and the used car lot skit.

He was definitely desperate to make a sale. And, he did everything he could to discourage me from a used car (the DP requested for a used Honda was greater the one of the new misfits GM has been producing).

Funny!Ive always wondered for years why the auto makers didnt make vehicles that got better mpg.and even worse is people keep buying gas hog vehicles as daily transportation.We really dont need hybrids if small cars are built right,toyota yaris(40+mpg)just look at how europe has had diesels in their small cars for years,my station wagon with a diesel gets twice the mpg,thats what forum members in europe tell me.its not some fancy hybrid.Allspar site talked about how chrysler had a diesel powered mini van and decided americans wouldnt be interested!yeah lets blame the government for auto makers poor decisions and heck i think theres plenty of tax on our fuel and dont worry im sure the new administration well tax you more.

Friend,

I prefer to see people who use a service to pay for its use. This was the premise of gas taxes, to raise money to pay for improved and maintained roadways. The amout being raised currently is too little to pay the current costs of mainenance. Therefore gas taxes should rise.

Advertising can influence people's preferences and choices. But, regardless of the ads or the purchase, you are stuck with the reality of what you have bought. I used to drive a used Datsun 510 hatchback (early '80's model), which gave very good acceleration, held 4 people comfortably, had gas mileage of 40 mpg or better most of the time, and finally expired with more than 300,000 miles on its clock. All of the advertised cars, with "power" or "performance" or the implied sex-appeal of more recent years never came close to it. I now drive a used Geo Metro, chosen last year specifically for its very good gas mileage (average is 40-45 mpg, with worst being 32 and best 53). Not even being manufactured now, and the current crop of "fuel efficient" cars from all manufacturers barely touch it (except for a few hybrids).

It would have cost Detroit very little to have a fuel-efficient design or two in the wings, ready for production. They have had them in the past! Did they do this???? Did they act with even a small degree of intelligence????

Let me respond to the blog entry, line by line:

The real trouble with America's automakers comes not from a lack of "bailout," but Congress' fuel-economy mandates. It is pretty simplistic to condense 100+ years of automotive history with all its innovation, heartache, successes, failures, etc. into a single conclusion, and then to blame a single entity for the present state of this industry. As others have posted, the CAFE standards have been around for a couple decades and have been watered-down for much of that time.

These require car manufacturers to spend billions on developing hybrids they know the public won't buy if gas prices stay low. Hybrids are only one of the available means of improving fuel economy. Again, its convenient to ignore the many other means (such as fuel choice, engine size, acceleration, add-on equipment, etc.) that have already been around for years. I remember buying gas at 19.9¢ per gallon. The currently "low" gas prices won't stay that way because of the apparently inexorable rise in world-wide consumption/demand in the face of a supply which is stable at best. The same advertising which could increase desire for a particular automotive feature or brand can also increase the appeal of a hybrid even if gas prices were to stay low.

But Congress won't repeal the CAFE (Corporate Average Fuel Economy) because they fear the environmentalists. Afraid of the environmentalists? Not hardly. Consider the number of ways in which the last 8 years of congressional and presidential action has diminished the environmental integrity of this country. Nope. They are reacting to some very strong grass-roots messages from many people and groups which happen to include environmentalists among their ranks but are far from controlled by them.

They won't repeal CAFE's "two-fleets" rule, which requires manufacturers to build cheap cars instead of importing them, because they fear the UAW. Huh? This is the first time I have heard this being mentioned. How about the non Big-3 makers in this country? And fear of the UAW? Perhaps in the 1950's and even the 1960's, you could claim some fear of Walter Reuther and the UAW. Not now! The influence of "big labor" on governmental policy is much smaller. About the only UAW problem you could justify is the legacy costs for retiree's benefits which are claimed to add an estimated $1000 to new car costs from the big-3 today. This could be an area to explore in any "bailout" to the automakers.

And Congress won't increase fuel tax because they fear the voter. The present fuel tax is a much smaller percent of the fuel costs than it was in the past, and is far too small to pay for the road construction or maintenance we probably need. I'd be more inclined to blame the belief that taxes per se are generally bad for the people, the economy, and the country. This has become a mantra among many groups of people. Unfortunately, the same people who say we need lower taxes with a private sector that will cover the needs of people are the people who individually donate the least as private citizens. While those who prefer taxes for the good of the community are most likely to be donating as private citizens also.

Now a comment: To those who are promoting subscription to Drives or other newsletters and blogs---controversial topics can generate interest and subscription. However, promotion using blog postings which are as eccentric as this are more likely to make me say "thanks, but no thanks!"

John Mueller