Automotive News - July 14, 2008 - (Page 12)

12 • JULY 14, 2008 opinion CAFE standards: Stop whining and get to work It is distressing that some automakers are back in Washington whining about meeting new fuel economy standards at a time when their customers are demanding vehicles that exceed the regulatory mandates. The companies’ complaints suggest that they have learned nothing from previous oil shocks about the long-term need to improve the fuel efficiency of their products. What a pity. The Detroit 3 would be much better off today if corporate average fuel economy standards had risen modestly — in four-year increments, say — Automakers over the past 20 years. Customer demand for larger, more powershould use ful cars and trucks could have been blunted by regulatory the current crisis mandates. Today’s light-duty vehicles would be more fuel effias an opportunity cient and less likely to be colto improve their lecting dust on dealership storage lots just because the price of gasoline has soared. manufacturing But the obstructionism of the flexibility and their Detroit 3 — and their recent ally, Toyota — gave weak-kneed product lineups. administrations and Congress the political cover they needed to avoid making reasonable but unpopular public policy. The opportunity for leadership on energy policy was left behind in the dinosaur tar pits, along with the Detroit 3. Belatedly, the Bush administration and the current Congress have had the political gumption to make a start by raising fuel economy standards. Today it’s stupid to whine about CAFE because the consumer is way ahead of CAFE standards. Rising gasoline prices are driving new-vehicle buyers back to four-cylinder engines to a degree the nation has not seen since the last energy crisis. There is danger in swinging the pendulum too far in the direction of small cars. One of the lessons of previous oil shocks is that consumers will adjust to higher fuel prices and want back some of the utility of bigger pickups and SUVs. Brands that do the best in turbulent times have a wide, flexible selection of vehicles. In a market economy, the customer is right. But consumers are fickle. So it behooves automakers, especially the Detroit 3, to use the current sales crisis as an opportunity to improve their manufacturing flexibility, as well as their product lineups. It is long past time for automakers to stop whining and work to create a better future for their customers, the nation and themselves. I wasn’t around when World War II disrupted the automobile industry and created the Arsenal of Democracy in Detroit. But it must have been a tough time for the automobile dealers of America. No cars were being made, and you couldn’t even get tires for your used cars. And, yes, gasoline was rationed. Most new-car dealers quickly went into the used-car business and spent a lot of time on parts and service. They didn’t have a lot of choice. Today, it’s not that bad by a long shot, but it’s got to be getting rough for a lot of dealers. There are plenty of challenges, and dealers’ challenges are different depending on what brands they’re selling. But when you see that June sales were down for Toyota Motor Sales and Nissan North America, as well as for the Detroit 3, you know that everyone has to stay sharp. DAILY AUTO NEWS >> You can get the news you need every day. Go to www.autonews.com/signup and sign up for our daily e-mail newsletter. Uncertainty is the name of the game Aside from the price of gasoline, no one has a perfect idea of what’s causing this slowdown, but a lot of us remember the oil shocks during the 1970s when gasoline prices skyrocketed. Today, sales of some models are down because of short supply. People bought out the stock in May. And sales of a lot of large pickups and SUVs have simply stopped for the time being. Uncertainty is the biggest detriment to car sales. We have plenty of that these days, and no one has a crystal ball that will tell us what’s going to happen in the next few months, much less a year or so. Consumers are confused, and a lot of them aren’t switching from large to small; they are sitting on the sidelines until they No one has a crystal ball that will tell us what’s going to happen in the next few months, much less a year or so. have some sense of what’s going on. I have no doubt that the same is true for the folks at the factories and for suppliers. No one really knows what lies ahead. Anyone who tells you he does is fooling, and his guess is no better than yours or mine. The price of gasoline isn’t going to go down, although I wouldn’t be surprised to see it drop temporarily. And the shift to smaller cars will continue until the automakers figure out how to squeeze more mileage out of bigger vehicles. Uncertainty, sure — but that’s what makes this business so fascinating. and imprudent driver, not the company that manufactured the vehicle he was in. The fact that a jury initially awarded the young man’s family $15 million is equally puzzling. Unfortunately, until common sense becomes commonplace, we will hear stories like this that paint the big, bad auto companies as negligent, even when their vehicles meet highway safety standards. STEPHAN MORRIS Belton, Mo. The writer sells used cars. Honda dealer rubs salt in a wound To the Editor: Knowing that Automotive News is sensitive to the feelings of its readers who pay for their subscriptions and support Crain Communications, I was quite surprised when I saw Page 1 of the June 16 issue. For those of us facing some of the most difficult times in years in this business, I thought it particularly insensitive of you to feature a smiling Honda dealer flashing a big “thumbs up” and a smile (“Honda dealers scramble amid stampede to small cars”). Why didn’t you just feature a Toyota dealer in a Prius raising his middle finger at the rest of us? Or maybe I’m being too sensitive. ANDY BRYANT Dealer Smokey Point Buick-Pontiac-GMC Arlington, Wash. Unsafe driving wasn’t Ford’s fault To the Editor: In response to Edward Lapham’s June 23 column, “Roofs, rollovers and reckless driving”: When I was young, I did stupid things in cars, too. C’mon — we all did. And in doing so, we took risks that could have damaged our vehicles, injured our bodies or taken our lives. I understand that Tyler Moody’s family is upset that the Ford Explorer didn’t protect him from a fatal injury, but what gives the family the right to sue Ford? The kid was speeding, and he made an illegal pass. He took a risk and paid the ultimate price. Congress wants the National Highway Traffic Safety Administration to adopt tougher roof-strength standards, which will force auto manufacturers to add weight and/or expense to vehicles. You and I will pay that extra cost when we buy a vehicle and every time we drive it because weight has an impact on mpg. Auto manufacturers should not be responsible for the poor judgment of THE WEEKLY NEWSPAPER OF THE INDUSTRY Established in 1925, published every Monday by Crain Communications Inc. certain drivers and operators. And families should not be so quick to go after large organizations with deep pockets because their product is involved in a death. BORIS GUNJEVIC Service Development Manager General Motors Denver Keith E. Crain, Publisher and Editor-in-Chief Peter Brown, Associate Publisher and Editorial Director David Sedgwick, Editor Edward Lapham, Executive Editor HOW TO REACH US Web site: www.autonews.com Editorial staff autonews@crain.com Phone: 313-446-0361 Fax: 313-446-0383 Circulation Advertising subs@crain.com rgreer@crain.com Phone: 888-446-1422 Phone: 313-446-6050 Fax: 313-446-6777 Fax: 313-446-8030 Editorial data/research To locate information that has been published in Automotive News, call 313-446-1662. Customer service To start or renew a subscription or to report an address change or a delivery problem, e-mail subs@crain.com or call 888-446-1422 (in the U.S. or Canada) or 313-446-1662 (in all other locations). AUTOMOTIVE NEWS (ISSN 0005-1551) is published weekly at 1155 Gratiot Ave., Detroit, MI 48207-2997. Periodicals postage is paid at Detroit, MI and at additional mailing offices. Postmaster: Send address changes to AUTOMOTIVE NEWS, Circulation Department, 1155 Gratiot Ave., Detroit, MI 48207-2912. Canadian Post International Publications Mail Product (Canadian Distribution) Sales Agreement #40012850, GST#136760444. Canadian return address: 2-7496 Bath Road, Mississauga, ON L4T 1L2 Printed in the U.S.A. Careless driver was to blame for crash To the Editor: After reading Ed Lapham’s June 23 column, I was left wondering what happened to accountability for one’s actions. While the death of any young person is tragic, no matter what the circumstances, I do not feel that Ford or any other manufacturer should have to build a vehicle that can withstand a NASCAR-style crash. If the column is accurate, it seems that the accident was the fault of the careless autonews.com Did you know that you can write a letter to the editor on our Web site? Here’s how. Go to www.autonews.com. 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Table of Contents Feed for the Digital Edition of Automotive News - July 14, 2008

Small-car boom misses Chrysler Ford's large rwd car plan is iffy Suppliers: Inflation is looming Hummer H3T price: $31,495 VW may build next Passat in U.S. plant Glut of trucks pulls Prius to U.S. Ford sues U.S. over taxes Restyled Ridgeline Volvo will tighten U.S. dealer network As BMW's chief in N.A., Purves got biggest thrill out of Mini Despite pricey fuel, Jetta diesel in demand Everybody's a critic: How dealers cope with online reviews Hyundai goes big on Genesis lease The shift to automatic: A transmission transition Jaguar-Land Rover dealer: Stand-alone would bankrupt me Chevy christens compact Cruze Fiat, BMW will team up on platforms, parts Revision: Bosch still tops Auto News supplier list GM to build Volts in U.S. for Europe GM ads will push mpg for 90 days A missed opportunity 2008 sales forecast? 14,652,757 Suzuki cuts U.S. work force 8% CAFE standards: Stop whining and get to work Uncertainty is the name of the game Honda dealer rubs salt in a wound Careless driver was to blame for crash Unsafe driving wasn't Ford's fault For doomsayers, business is booming again Best ad slogans have staying power Bird Dog Club creator hunts dealer poachers Dealers How to design a Lamborghini? Passion for speed certainly helps Dressed to kill Check for children Delinquency rate on indirect loans skyrockets Group promotes payment assurance Ford has big plans for small vehicles in North America Mulally pushes Ford toward fuel efficiency Ford brand will draw on European lineup With no new vehicles planned, Mercury's future is bleak Engines promise power plus fuel economy Horbury: We'll keep our vehicle designs fresh Ford aims to move Lincoln upscale Toyota's Lentz: Don't panic over collapse; market will stabilize Personnel Chrysler's car sales sag in June — even more than trucks PG sells majority of auto glass business to private-equity firm Chrysler's Campi makes nice Suit against Ford is reinstated BMW reassesses Mini demand JCI plant cuts shift, work force CAW board endorses local president Purves: Thumbs-up for BMW innovations Current trend in Europe: Electric cars Solid reviews for Ford's new Flex Philosopher has insight for ailing U.S. auto industry The 'B' word brings media deathwatch at GM Chrysler to dealers: Don't panic

Automotive News - July 14, 2008

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