November 26, 2008--To Grandmother's House
As more than 80 million Americans take to the road this holiday weekend, they will find gas prices about half what they were last year, but they will have less in their wallets and 401(k)s.
If they are driving GM, Ford, or Chrysler cars they are probably worried about where they will get parts or who will honor their warrantees if one or more of the Big Three go out of business.
Meanwhile in Detroit and Washington many hands will be on deck through the weekend, working on plans for a potential government bailout for the auto industry.
When the CEOs arrived in Washington last week via their private jets, tin cups in hand, to quote one congressman, they were sent back home to come up with a new business model that would convince Congress that they finally get it—that they have plans to produce the kinds of cars Americans want and at prices that are competitive with imports.
They were given until the first week in December to get that assignment done, and thus far all that we have seen as evidence that they are finally being sensitive to the mood of the country is GM’s decision to sell two of its fleet of corporate jets. And, I suspect, the next time they show up asking for money they will fly commercial.
We have also been hearing from Columbia University’s Jeffrey Sachs and others that there will be hopeful news emerging from Detroit if the automakers are just given enough time to get their new hybrids onto the market. To make his point he has been touting GM’s Volt. Due to be on sale in late 2010. A plug-in hybrid that will allegedly get 100 miles per gallon.
As I have been writing here, my experience with Toyota’s Prius has been very positive, but it gets “only” about 40/45 miles per gallon and if the Volt will turn out to be as advertised maybe we should give GM and the others the bridge loans they need to get from here to there.
In fact, though disgusted for decades with the stupidity and arrogance of America’s automobile executives, on the basis of the Volt’s promise—offering technology Professor Sachs claims that will leapfrog past what Toyota and Honda are producing—up until a recent report about the Volt in the New York Times I had reluctantly come around to supporting the bailout.
According to the Times’ widely regarded authority on the auto industry, Micheline Maynard, the Volt doesn’t sound all that advanced or promising.
Forget for the moment that it will not be brought to market for nearly two years while Toyota has been selling Priuses here for four, Maynard reports from its specs that its range will be considerable less than the current Prius, on its batteries it will be able to run for only 40 miles, and it will cost $40,000 as compared with about $25,000 for the Prius. Thus, it will likely be doomed to niche car status.
Further, GM plans to sell only 10,000 Volts in its first year, and when in full production they project sales of only 60,000 annually. In 2007, by comparison, Toyota sold more than 180,000 Priuses in the United States. (See NY Times story linked below.)
Perhaps I’m missing something here; but in the meantime, pass me the sweet potatoes and stuffing.
If they are driving GM, Ford, or Chrysler cars they are probably worried about where they will get parts or who will honor their warrantees if one or more of the Big Three go out of business.
Meanwhile in Detroit and Washington many hands will be on deck through the weekend, working on plans for a potential government bailout for the auto industry.
When the CEOs arrived in Washington last week via their private jets, tin cups in hand, to quote one congressman, they were sent back home to come up with a new business model that would convince Congress that they finally get it—that they have plans to produce the kinds of cars Americans want and at prices that are competitive with imports.
They were given until the first week in December to get that assignment done, and thus far all that we have seen as evidence that they are finally being sensitive to the mood of the country is GM’s decision to sell two of its fleet of corporate jets. And, I suspect, the next time they show up asking for money they will fly commercial.
We have also been hearing from Columbia University’s Jeffrey Sachs and others that there will be hopeful news emerging from Detroit if the automakers are just given enough time to get their new hybrids onto the market. To make his point he has been touting GM’s Volt. Due to be on sale in late 2010. A plug-in hybrid that will allegedly get 100 miles per gallon.
As I have been writing here, my experience with Toyota’s Prius has been very positive, but it gets “only” about 40/45 miles per gallon and if the Volt will turn out to be as advertised maybe we should give GM and the others the bridge loans they need to get from here to there.
In fact, though disgusted for decades with the stupidity and arrogance of America’s automobile executives, on the basis of the Volt’s promise—offering technology Professor Sachs claims that will leapfrog past what Toyota and Honda are producing—up until a recent report about the Volt in the New York Times I had reluctantly come around to supporting the bailout.
According to the Times’ widely regarded authority on the auto industry, Micheline Maynard, the Volt doesn’t sound all that advanced or promising.
Forget for the moment that it will not be brought to market for nearly two years while Toyota has been selling Priuses here for four, Maynard reports from its specs that its range will be considerable less than the current Prius, on its batteries it will be able to run for only 40 miles, and it will cost $40,000 as compared with about $25,000 for the Prius. Thus, it will likely be doomed to niche car status.
Further, GM plans to sell only 10,000 Volts in its first year, and when in full production they project sales of only 60,000 annually. In 2007, by comparison, Toyota sold more than 180,000 Priuses in the United States. (See NY Times story linked below.)
Perhaps I’m missing something here; but in the meantime, pass me the sweet potatoes and stuffing.
posted by Steven Zwerling at
7:20 AM
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