Cassandra of the car-writers Edward Niedermeyer is at it again in the New York Times. The editor of The Truth About Cars website attacks the business practices of GM in particular and the auto industry as a whole for resuming their old ways in the face of falling sales, even as they received billions in government support.
A year and a half since the Chrysler and GM bankruptcies, he says, these companies are totally failing to give us the green future we were promised. Instead, the industry is selling too many fleet cars, hyping and selling SUVs and trucks over green products, stocking huge inventories, and reverting to the evils of incentives and rebates.
Well, you gotta give Ed some credit: A few of his arguments do ring true; others are bogus; and, per his usual practice, no solutions are offered. Never once does he mention that the U.S. provides some of the world’s cheapest gasoline—the factor that influences industry (and customer) behavior more than almost anything.
Let’s look at what he says.
After promising to lead the world in producing green cars, we are nowhere near ”the kind of transformation we were promised. …Despite rolling out the much-hyped Cruze compact and the Volt plug-in hybrid, G.M. still sells half again as many trucks and S.U.V.’s as it does cars. This year 73 percent of Chrysler’s sales have been light trucks.”
This is to say, first, that the transformation should happen overnight. Mr. Ed gives no credit to GM for its greatly improved quality and the engineering advances in the green cars it has built and has in the pipeline.
Further, he blames the industry for providing what consumers seem to want. The Asian companies are also producing cars like the Sequoia, Armada (photo, top of story), and Tundra—all gas hogs, all selling to their fans as long as gas prices remain low and small cars are denigrated as “sardine cans” or “econoboxes.”
The real question is whether the companies should build what the government wants them to build or what consumers, for the moment, demand. The government can push the industry through mandating and reinforcing CAFE and safety standards, which raise car prices, and they can encourage or discourage green car purchases through tax policy. But they can’t ultimately solve the problem of pollution and the environment this way or change consumer buying practices.
Ed complains that buyers don’t like fleet cars (they are “unsexy”), and the industry is pursuing short-term profits with things like rebates and incentives. They are building too many vehicles, he claims, and inventories on dealers’ lots are way too high.
He’s right about the inventory situation, which can only cause prices to fall, and incentives create merely artificial, short-term demand. Fleet cars, however, can and should provide new markets to the industry, and they are a boon to used-car dealers.
In fact, one reason the used-car market is booming is because of rising new-car prices and the growing availability of fleet cars. And it is a better green solution than further clamping down on the U.S. auto industry, as Niedermeyer seems to want. A used car is already built, its carbon footprint is in the environment.
DealFinder can help you find the right car at the right price, even if it’s an older gas-hungry Tundra. My kid has one, loves it, and he’s a greenie. It all goes back to gas prices, doesn’t it?
Should the government finally consider raising the tax on gasoline, as many have proposed?