Photo courtesy of jolengs at Flickr.com.
American car manufacturers love pickups and SUVs. These high end vehicles have been lavished with elaborate advertising, intensive research, and promotional test driving campaigns because of high profit margins. As a result of this infatuation, gas guzzlers account for an unhealthy percentage of sales from the Big Three.
Profits at Detroit’s Big Three will shrink by $7 billion to $11 billion. Reductions in vehicle sales, especially SUVs, will lead to an industry-wide decline in pretax profits of $11.2 billion to $17.6 billion. Detroit’s Big Three will absorb $7 billion to $11 billion in total reductions because of their dependence on SUV and pickup sales.
Detroit’s Big Three will absorb nearly 75 percent of the decline in total sales volume. Without deeper discounts, sales volumes in the North American car and light truck market will shrink between 9 and 14 percent, or 1.9 to 3.0 million vehicles, because of the overall effect of higher oil prices on the economy. Detroit’s Big Three automakers absorb nearly 75 percent of the sales decreases.
The chickens are coming home to roost. For years, American car manufacturers have lobbied for freedom to produce cars that are less and less fuel efficient. While protesting legislation to raise the CAFE standards, Senator Bennett summed up the position nicely:
…the manufacturer deals directly with the customer in producing the kinds of automobiles people want to buy. And if people say: I really don’t want to buy that automobile, if CAFE standards disappear, the manufacturer can say: OK, if you don’t want to buy it, we won’t produce it. Whereas, now there is pressure; we have to produce it in order to meet the CAFE average, whether people want to buy it or not.
Unfortunately for American autoworkers, car manufacturers were slow to recognize that consumer tastes are shifting. With oil headed over $120 a barrel, sales of most American made cars have fallen sharply, but, believe it or not, economy cars are selling pretty well. Even “economy” cars that would barely meet foreign standards are selling well in the US:
Focus sales are up 23 percent through March compared with the first quarter of last year. The redesigned car is taking 7.6 percent of the U.S. small car market.
Photo courtesy of Ochileer at Flickr.com.
Anyone out there in the market for a new car?
What kind of car are you considering, and why? Leave us a comment!
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18 Nov 07 |
Flickr photo courtesy of Rodrigo Walker Armijo.
The Christian Science Monitor writes about developments in technology that are bringing us closer to the possibility of solar powered cars!
The ranks of potential buyers for such cars are growing by leaps and bounds, say many car-industry analysts. But don’t look for them on normal streets just yet, they add quickly. Limitations of batteries and solar panels — though lessening — are still issues, among others.
Yet “fringe markets” — such as commuters within small towns, seniors in retirement villages, and users of industry fleets — are in a position to drive the first sales boomlet for such cars, analysts say.
Until then, Titus and other inventor-tinkerer types are offering a peek into the future of transportation in America – well before the major car companies.
“Garage tinkerers like Titus are the tip of an iceberg of innovation demonstrating the direction of the national, global trend,” says Steven Letendre, professor of business, economics, and environment at Green Mountain College in Poultney, Vt., who lectures widely on the future of electric and hybrid cars and solar energy.
In fact, their ideas are increasingly showing up in the mass-market innovations of larger car companies, Letendre and others say. America’s Ford Motor Co., Japan’s Mazda, and Europe’s Venturi Motors have all debuted prototypes at exhibitions with solar panels that boost electricity for internal lighting.
I did a quick search and found that the Solar Bug has a web site with more information about it. Check it out here. I was disappointed to find out that they don’t have any prices listed on the site. It says “Available 2008″ on the front page though. This would be a perfect short commute car for taking to work.
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