Eating Our Shorts

Volkswagen EngineWhile GM complains, Mercedes innovates. While GM points fingers, Volkswagon produces.

General Motors’ vice chairman Bob Lutz compared the proposed new CAFE standards an attempt to force automakers to sell smaller vehicles to “fighting the nation’s obesity problem by forcing clothing manufacturers to sell garments only in small sizes. For one thing, it puts us, the domestic manufacturers, at odds with the desires of most of our customers,” he said.

At odds with most of our customers? That’s because so many of GM’s customers fled to foreign manufacturers to get what they wanted that GM only has die-hard Chevy truck owners and gasaholics buying their gas guzzlers. I would argue that the proposed standards are more comparable to fighting the nation’s obesity problem by forcing people to go on a diet.

The CAFE standards aren’t about forcing auto manufacturers to sell smaller vehicles, it’s about increasing engine efficiency across the board. People who want to buy 4-liter pickups will still be able to, but the new standards will force GM to work out engine, drive train and tuning design that brings the mileage up. Without a standard that sets the bar high and penalties if it’s missed, U.S. manufacturers appear to have no incentive to innovate and instead watch their share of the market erode. I don’t understand why GM shareholders are allowing their executives to operate this way.

Foreign car manufacturers may have had the price edge on us (much less so today due to the declining dollar) because of GM and Ford’s poor management decisions and caving in to the unions 30 years ago regarding pensions and health insurance; but today’s motor executives have no excuse for not planning for the inevitable increase in fuel prices and producing more fuel efficient drive trains. They have no excuse. Now that they’ve run out of time they cry to their congressmen.

So instead of building a fuel-efficient vehicle that will sell in the U.S., GM is lobbying Congress to delay or defeat the proposed new CAFE standards that they say can’t be met.

GM will continue to lose ground to the innovators, and we’ll see even more manufacturing jobs slip away. We need some forward-thinking executives at the top rungs of the auto industry. We need the can-do attitudes of the 60’s back.

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2 Responses to Eating Our Shorts

  1. Carl says:

    Actually, I work with the Alliance of Automobile Manufacturers and it’s important for people to realize that we want to improve fuel standards, but we have to use technology to do it smartly.

    Automakers support increased fuel efficiency standards, but ones that are realistic and take into account the impact this will have on American jobs and lives. The Senate Energy bill sets the bar so high that the standards can only be reached by making much smaller vehicles that the public doesn’t necessarily want. The House bill also requires technologically unrealistic goals that will force massive production shifts that the public may not demand. Each of these will jeopardize many American jobs. Meanwhile, H.R. 2927 accomplishes a combined fleet average of between 32-35 mpg by 2022, and it does it through technology.

    You can check out more information at DriveCongress.com. Thanks.

  2. Paul says:

    Thank you for the comment, and I will most definitely check out the web site.

    I suspect that if Congress continues to demand across-the-board mileage improvements, an eventual compromise will be reached that is both technically feasible and not limited to small vehicle manufacturing, that will also lower the bar a bit.

    My concern is that instead, the time frame will be extended for so long a period that the U.S. manufacturers will simply delay real progress on fuel efficiency gains, and continue to lose ground to the demonstrably more nimble foreign manufacturers.

    U.S. auto executives have to realize that their backs are up against the wall. I don’t think that collectively that have the necessary sense of urgency. A good Congressional kick in the pants might just do it.

    BBD

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