If you build
them, will they come?
Editor's note -- This article was written back in 2006, and it provides good historical perspective on where hybrids and compacts have come from, and where they are going.
There is no doubt that America should move away from
gas guzzlers, and one good way to reduce gas guzzling
is simply to make vehicles smaller.
While hybrid
cars, such as the Toyota
Prius or the Ford
Escape hybrid, can significantly reduce fuel
consumption, they do so at a cost - higher prices.
On the other hand, the Honda Fit, Toyota Yaris, or Kia
Rio, for example, can offer very good fuel economy for
less than $15,000.
Unfortunately, most consumers just aren't interested
in compact cars and neither are automakers.
Jack Nerad, market analyst at Kelley Blue Book, notes
that smaller cars don't necessarily bring big profits
for automotive manufacturers, paraphrasing auto
pioneer Henry Ford who once said small cars only bring
small profits. (MSNBC)
Hybrid technology, on the other hand, offers the
ability to make larger vehicles much more fuel
efficient. Surely the extra costs of hybrid technology
cut into profits, especially in the short term, but
the long term offers much higher profit margins for
automakers as hybrid costs decrease with greater
production and technological innovation.
Perhaps smaller cars could be made more appealing with
customization capabilities, such as are offered for
the Mini Cooper and the Toyota Scion, but that won't
be enough to survive.
Inevitably, cheap cars can't power the auto industry
and the days of cheap American gas are crashing to an
end.
Advanced technologies will be the key to the future.
