Downward Cycles: The American Auto Industry

The automotive industry is trembling. Plant closures and union strikes are shaking Europe. American automakers are offering ridiculous incentives to move gas-guzzling SUVs, while financially floating on soon-to-be-rated junk bond status. Even Japan's Nissan is facing a steel crisis.

Just recently AutoNation, the largest holding company for U.S. auto dealerships, shocked Detroit's Big 3 by announcing its dealers are going to resist some new inventory.

According to Yahoo, the Detroit News states, "The issue stems from a fundamental business problem facing Detroit automakers. General Motors, Ford Motor and Chrysler Group need to keep their factories running to generate enough cash to pay for their huge pension and health care obligations. Toyota and Honda can simply cut production when demand wanes rather than pile on profit-eating incentives."

Inefficient, gas guzzling automobiles

SUVs and other inefficient models demonstrate not just American inefficiency, but plain and simple ignorance.

Waste of oil, waste of space, waste of steel, waste of clean air, waste of horsepower and waste of American labor. Eventually waste does cost.

Now the Big Three are stuck in a downward spiral of lost market share, senseless innovation, and the forced-for-survival production of more inefficiency.

Automotive Past and Future

My recent hybrid vehicle test drives demonstrated a very striking difference between Ford and Toyota. The Ford Escape hybrid felt just like the Ford Bronco II my parents used to drive. The Prius, on the other hand, felt like the future.

One automaker is in the future, the other is trying to hold on to the past.

Side by side the Prius is a good bit smaller than the Escape hybrid, yet inside, the Prius feels much bigger inside than the Escape. The Prius is elegant, and sensible. Space simply isn't wasted.

If you care about the environment, if you care about terrorism and oil profits, if you care about balancing corporate greed, then it is impossible not to realize that every automobile needs to be as efficient as the Prius.

As we head into the future, the Prius isn't the end, just proof that hybrid vehicles are far superior to today's non-hybrids. Moreover, hybrids are proof that corporate responsibility will be Detroit's only saving grace.