Automakers say they can’t make it alone

Chief executives of the major U.S. automakers are asking for government incentives and wider efforts to reduce oil consumption and carbon emissions. Fuel-economy mandates, slow sales and loss of market share to foreign competitors have the automakers concerned. Massive layoffs and plant closings are forcing major restructuring in order for the companies to remain viable. They said they are willing to do their part, but the responsibility for reducing our country’s dependence on oil should be shared.
Officials from Ford, General Motors and Chrysler called for more development of biofuels such as ethanol. They said that they have made a major commitment into developing flex-fuel cars, but that the limited supply of biofuels is thwarting their efforts.
Posted by Patrice Hein

35 Comments

  1. JWink
    Posted March 17, 2007 at 2:17 am | Permalink

    Repeat after me — THE PRODUCTION OF ETHANOL AND BIO-FUELS USING WATER FROM THE ANCIENT UNDERGROUND OGALLALA AQUIFER HERE IN KANSAS AND ADJACENT STATES HAS THE DANGEROUS POTENTIAL OF DESTROYING OUR DRINKING WATER SUPPLY. IT COULD TURN KANSAS AND ADJACENT STATES INTO A WASTELAND WITHIN 20 YEARS OR LESS.

    A moratorium is needed barring building ethanol and bio-fuels plants in Kansas until a full scientific examination can be produced so this critical problem can be fully understood.

    In the meantime, locate ethanol/bio-fuels plants near the Mississippi River and coast-lines or use effluent from large sewage treatment plants.

    My question is — can ethanol/bio fuels be produced without using our underground Ogallala water?

    And for those who haven’t studied this problem … including our state legislative politicians … this water aquifer draw-done does threaten Wichita’s water supply in less than 20 years.

    Refute this if you can.

  2. Joe Williams
    Posted March 17, 2007 at 6:05 am | Permalink

    Simple solution for struggling US Automakers.

    Get rid of the unions!

    Foriegn automakers in the US are non-union and are building better, more fuel efficient cars, creating more good jobs and opening plants left and right, which good old fashion and extraordinary work ethic of non-union labor.

    :)

  3. Kev
    Posted March 17, 2007 at 6:09 am | Permalink

    I am so sick of hearing GM and Ford bawl. Especially Ford. The fact of the matter is this- both of these companies- especially Ford- essentially decided to get out of the car business and put almost all their business models on the truck and SUV side. For awhile this was a good move and vehicles like the Expedition and Explorer sold like hotcakes. That was when gas was under $2 a gallon. Now gas is more than $2 a gallon about 9 months of the year and it is more than $3 a gallon during the summer driving season when demand peaks. So people are switching back to cars and small SUVs which the Japanese based car makers have excelled at- largely because GM and Ford abandoned the market. GM makes some cars but they are mostly crappy and the majority of them are probably sold to fleets (the Japanese do not offer fleet programs for their cars).

  4. Kev
    Posted March 17, 2007 at 6:13 am | Permalink

    And the unions have nothing to do with the decisions by auto makers on what to build, how to build it and what materials to use. Union members just put together what they are given to work with. Americans love to blame everything on unions. Unions are good. This is a management issue but you know how the cons are- management can do no wrong! If the UAW went away tomorrow nothing would change at GM or Ford.

  5. Kev
    Posted March 17, 2007 at 6:16 am | Permalink

    “Repeat after me — THE PRODUCTION OF ETHANOL AND BIO-FUELS USING WATER FROM THE ANCIENT UNDERGROUND OGALLALA AQUIFER HERE IN KANSAS AND ADJACENT STATES HAS THE DANGEROUS POTENTIAL OF DESTROYING OUR DRINKING WATER SUPPLY. IT COULD TURN KANSAS AND ADJACENT STATES INTO A WASTELAND WITHIN 20 YEARS OR LESS.”NOTE- Nobody drinks water from the aquifer anymore. Your drinking water supply is now Wal Mart which sells a variety of water to drink.

  6. kelly
    Posted March 17, 2007 at 7:07 am | Permalink

    I looked hard last summer for a full-size PU truck with 4-wheel drive that would reliably produce 20+ gas mileage – I couldn’t find anything. Ford had a 6 cylinder full-size PU that might have produced mileage close to 20 but it wasn’t available in 4-wheel drive. Now, surely, the technology exists that can put 4-wheel drive with a 6 cylinder engine, so why isn’t it possible to buy such a truck? No union made that decision.

  7. Heckler
    Posted March 17, 2007 at 8:16 am | Permalink

    kelly

    I know several people who’s 4×4 3/4 ton diesel pickups push close to 20 mpg highway. The next generation of diesels may well reliably break the 20 mpg mark, but they won’t be cheap. Look for them in about 2 years.

  8. Joe Williams
    Posted March 17, 2007 at 8:41 am | Permalink

    I would like to have a mid-engine sports car, with great gas milage at a reasonable price. But management keeps screwing that up.

    I guess because I also want lasers, missles, smoke screens, and….

    ;)

  9. Posted March 17, 2007 at 9:24 am | Permalink

    Both the workers and the management at the major US automakers are responsible for their lack of financial performance. They should not be coming to everyone else to fix their problems.

  10. J R
    Posted March 17, 2007 at 10:04 am | Permalink

    This problem is touched on in “An Inconvenient Truth”

    Kids? The best mileage standard demands for cars in the United States is currently a PROPOSAL in California.

    It demands a mileage efficiency that is roughly equivalent to what is CURRENTLY mandated in China.

    Oh wait! I forgot to tell you. That mileage efficiency demand would be expected of US automakers in 10 years. 10 years, to get to where China is NOW! The auntomakers say they can’t do it.

    What that means in one sense is that China can sell their cars here. But what we make is illegal over there.

    And no Joe it is not the people (unions) who actually MAKE the cars that say this. It is management and design and marketing; the paper pushers.

    Makes ya think America’s best days may well be behind us.

  11. HardTruth
    Posted March 17, 2007 at 10:25 am | Permalink

    Toyota, Honda, and Nissan aren’t whining. They build cars in the USA. Let the ‘obsolete three’ either modernize or die.

  12. Dingus
    Posted March 17, 2007 at 10:27 am | Permalink

    There’s are many reasons why US automakers are struggling and most of them are the auto execs fault. Things like not investing in hybrid fuel efficient vechiles, by having the lowest cafe standards many US vechiles cant be exported to places like China a market with a billion people. Also american auto companies are saddled with paying the health care costs of their employees something their Japanese and European counterparts aren’t

  13. Heckler
    Posted March 17, 2007 at 10:27 am | Permalink

    JR

    Unlike folks in China Americans actually have a CHOICE of what to drive. They choose big, powerfull, safe vehicles as long as they can afford to feed them. Of course we could BAN the sale of light trucks and SUV’s to anyone who can’t prove a legitimate business need for them (think construction, farming, etc.)and U.S. automakers could meet those mileage requirements tommorrow. Govt. could Mandate what we all drive and we could save LOTS of energy.

    But guess what, in America the consumer CHOOSES what they want/can afford. America, not AmeriKa.

  14. Dingus
    Posted March 17, 2007 at 10:29 am | Permalink

    Im pretty sure that in Europe and Japan the workers are in trade Unions yet they do fine

  15. Heckler
    Posted March 17, 2007 at 10:35 am | Permalink

    American auto makers and workers together made the bed that they lay in. The benefits packages they agreed to back in the 70’s when they had no competition are sinking them. $5000-$6000 cost per vehicle in health care costs is killing them. Top heavy, slow to react management structure is threatening to capsize them. They did it to themselves and they should fix it themselves.

    I’m a loyal buyer of American automotive products but I’m not above abandoning them if they’re not smart enough to fix what is obviously broken.

  16. J R
    Posted March 17, 2007 at 10:36 am | Permalink

    Uh huh Heckler,

    Well,

    Not much of anyone else is building highway dreadnoughts anymore. In fact, the investment of US automakers in SUV production and the lack of current market for those gas guzzlers is part of the reason the big 3 are in trouble.

    Now if they go down completely because they will not compete with nations that produce more efficient vehicles, WHO is gonna build your “big, powerful, safe vehicles”?? They are gonna have to compete in efficiency. High end vehicles cannot keep them in business. It aint legislation that will kill the SUV, it’s market forces and poor planning by US automakers.

  17. Heckler
    Posted March 17, 2007 at 10:41 am | Permalink

    Dingus

    I don’t know about the Japanese, but the Germans can actually pay American workers reasonable benefits and make their cars cheaper over here. Same with BMW I believe. The Fascist/socialist economic structure in much of Europe is threatening to sink manufacturers there.

    The German manufacturers are forced to provide about 6 weeks of paid time off per year and are prohibited from paying anyone overtime. Work week is mandated at 35 hr/week and firing people is almost impossible. Their productivity sucks.

  18. Posted March 17, 2007 at 10:44 am | Permalink

    Depends on how you drive too. When I lived near my old home, me and my brother would take turns driving to work. He would always get less gas mileage that I would because of his lead foot and jackrabbit starts and stops…which I constantly complained about. :)

  19. Heckler
    Posted March 17, 2007 at 10:48 am | Permalink

    JR

    I don’t disagree with you on the SUV thing. They built what people wanted but are to heavy and slow to react to changing market needs like high gas prices. Don’t blame them for building what the customer wanted.

    They have to be able to sell what they make. The customer decides. But the automakers have to be able to react to reality. Europeans are getting incredible mileage out of the latest evolution of diesel engines.(think 35-40 mpg from a mid-size sedan, with very low emissions)But American auto makers fear that diesels won’t sell in America, so they’ve been slow to develop them.

    Don’t blame the automakers for selling what their customers want.

  20. raptor
    Posted March 17, 2007 at 10:52 am | Permalink

    The last Ford I bought was a total piece of garbage from the first day. Transmission failed at 15,000 miles, struts were undersized, blew a head gasket at 22,000, etc. Traded in on a Honda and never had a problem.

    Who do we blame for that? Poor design by management or poor assembly by the union workers? At this juncture, it really doesn’t matter. The American manufacturers (with the exception, I believe, of Saturn) do not know what the driving public wants, are behind the imports for reliability and innovation, and are overpriced to boot.

    Rather than try to assign blame to one side or the other, it is significant to note that the American car industry does employ tens of thousands, and I believe a temporary incentives to give them one chance to retool and improve to save those jobs is a worthwhile effort. Remember what tariffs did for Harley Davidson back in the early 80’s? Harley petitioned the government to remove the tariff early, and now look at them.

    It can be done…

  21. JWink
    Posted March 17, 2007 at 11:05 am | Permalink

    Coincidentally, after writing opening comments on this thread about the threat of ethanol production to our Kansas water supply — I see the Wichita EAGLE printed an editorial this morning “Conserve: Bill protects state’s water.”

    As I read this editorial, it appears the bill offers a drop in the bucket, however a needed drop, towards protecting our Kansas water supply.

    But it isn’t the whole answer!

    The bill proposes a plan called “Conservation Reserve Enhancement Program” (CREP) (and don’t you misspell it) to pay farmers not to pump water out of our underground water bearing aquifers including the Ogallala.

    To be fair, the EAGLE editorialquotes State Senator Carolyn McGinn as saying the “CREP” program is only “one piece of the puzzle,” an understatement in my opinion.

    Underground aquifer water flows relatively slowly through our underground gravel beds, generally southeastward, and recharges from rainfall even more slowly.

    For example, retiring 35 sections/square miles of land in a 36 section township gives the water rights owner of the 36th section the right to pump the water from UNDER ALL THE 35 NEIGHBORING SECTIONS OF LAND depending on the direction and geology of the underground water flow. So retiring water rights is definitely “not a magic bullet.”

    Further in the last five years or so, construction of the real WATER HOGS, that is, ETHANOL PLANTS, is proliferating across Kansas. Many Kansas politicians who are uninformed and/or misguided on our depleting water situation are praising ethanol plants as a “boon to the Kansas economy.” But one ethanol plant uses the water of thousands of residential users … and also can produce a toxic air effluent (stinking, poisonous air) that is dangerous to an area’s citizens, such as in Colwich, Kansas, and northwest Wichita.

    The CREP program might even be tremendously advantageous to Ethanol producers who also buy water rights from farmers.

    SO, BOTTOMLINE, AS ANOTHER PIECE OF THE KANSAS DECLINING WATER PUZZLE … THE KANSAS LEGISLATURE NEEDS TO IMMEDIATELY ADOPT A MORATORIAM TO STOP BUILDING/OPENING/OPERATING ETHANOL PLANTS IN KANSAS UNTIL AN ACCURATE ASSESSMENT CAN BE MADE OF THIS DANGEROUS THREAT TO THE WICHITA AND KANSAS WATER SUPPLY.

    As I have said before, Kansans have a drinking problem. They want a cool refreshing glass of pure aquifer drinking water from their municipal water utility … not recycled, regurgitated sewage water from our larger surface rivers.

  22. Kev
    Posted March 17, 2007 at 1:06 pm | Permalink

    “The last Ford I bought was a total piece of garbage from the first day. Transmission failed at 15,000 miles, struts were undersized, blew a head gasket at 22,000, etc. Traded in on a Honda and never had a problem.”

    SAME HERE! My wife, being the good American (well OK Canadian) she is had a Ford Escort wagon and that thing was a nightmare. The ignition would have to be replaced on it like every 6 months. Then the tranny failed and the head gasket blew all before 80,000 miles. We got rid of it and bought a Toyota!

  23. Kev
    Posted March 17, 2007 at 1:16 pm | Permalink

    Part of the trade imbalance too is not just caused by MPG standards but many other countries require that the cars have the driver on the right side of the car. Not only that but almost ALL other countries require products be metric as opposed to the system we use to build things. This means that USA manufactuers essentially have to build 2 different products- one for domestic sales and one for export which cost alot of money. The European and Japanese car makers don’t have as many problems. They do have to put the driver on the left side but they can and do sell metric cars in the USA. To even out the scale, we should either switch to metrics or force them to use only USA measuring system parts in cars sold here.

  24. Econ101
    Posted March 17, 2007 at 1:19 pm | Permalink

    Kyoto = OUTSOURCING!

    Clinton never presented the Kyoto Treaty to Congress, but he signed parts of it, through VP Al Gore.

    Clinton Knew that that a fight between leftist Unions and lefist Greens would kill the party, so he tried to make both happy at the same time!

    Come on lazy journalists! Print some stories on how US labor will be effected by Kyoto and other Global Warming measures!

    We are treated to a story on every “split” on the right.This is a split on the left, report it!

  25. Posted March 17, 2007 at 1:22 pm | Permalink

    That’s rather peculiar about the problems people have with cars. I remember buying a 1950 Chevrolet, 26 years old when I bought it. I changed the oil, tuned it up and did some maintenance on it. Lasted me for another 10 years until I sold, with a fresh paint job. :)

    Had friends who couldn’t keep a brand new car more than three years without something blowing up on it.

    Maybe there is something to do with regular maintenance and good driving skills? :)

    The people I knew who had problems with their newer cars backed out of their driveways without warming up their cars, didn’t let the cars come to a complete stop before they took it out of reverse and threw it into drive or first gear, rode their clutch (if they had one), hot rodded it, goosed it a lot (gave it excess gas to gain 40 foot advantage to get in front of someone so they could just turn right at the corner and…

    generally did not take good care of their car with maintenance.

    Hotrodding it, never check oil, tires, other fluids and waiting until something went completely wrong on their care before they fixed it.

    Maybe I’m wrong, but see too many examples of this. :)

  26. Econ101
    Posted March 17, 2007 at 1:24 pm | Permalink

    I drive a Chevy Impala.It is GREAT, 30 MPG and I can pass nearly anything else on the road, if I need to.

    I, too, have given up on Ford. My last, a Taurus, was awful. Of all things, window always frosted up becaue cooling system corrosion clogged heat exchanger. Had to flush radiator more than twice a year!

  27. cosmos
    Posted March 17, 2007 at 1:34 pm | Permalink

    I overheard at a car parts store — guy put synthetic oil in his car engine, thought it didn’t EVER need to be changed — engine completely burned out 75,000 miles later.

  28. J R
    Posted March 17, 2007 at 1:40 pm | Permalink

    Uh Paul F Rosell econ101?

    This thread is not about Kyoto. What is more? No one else has mentioned Kyoto.

    Idiot.

    Kev is very correct to bring up the metrics issue. Metrics is part of the problem in US engineering. Other countries use millimeters when measuring tolerances. The US system is more cumbersome. This MAY contribute to the fact that engineering tolerances allowed by Japanese manufacture are about one third that of what US allows.

    Or maybe our engineering and government standards are just too lax.

    In any case, US engineering tolerances are a big reason why our cars are junk.

  29. Jed
    Posted March 17, 2007 at 1:55 pm | Permalink

    I’m highly amused by the noises emanating from Detroit. Aren’t you the same people who go all apoplectic about “personal responsibility” whenever the subjects of minimum wage, welfare, Social Security and unemployment compensation come up? Maybe now would be a good time for you to take a bit of personal responsibility yourselves. Hint; it’s not the fault of your workers, the union or the Democrats, it’s your own attitude toward your customer base that drove them into the arms of imports! Wise up, and maybe you can salvage at least part of your business; don’t, and you go the way of the dinosaurs. It’s your choice, and your responsibility.

  30. cosmos
    Posted March 17, 2007 at 2:23 pm | Permalink

    Heckler,

    “They choose big, powerfull, safe vehicles as long as they can afford to feed them.”

    “Big” does not necessarily = “safe”.

    Some mid-size sedans, like Honda, have lower fatality rates than some SUV’s.

    Some SUV’s have an increased risk of rollovers, and have weak roofs that collapse.

    Their too-stiff steel girder frame transfers the crash impact to the occupants, and is a “battering ram” on other vehicles.

    UCS has “Building a Better SUV” in ‘Off-the-Shelf: Improving Vehicles’ at,http://www.ucsusa.org/clean_vehicles/cars_pickups_suvs/

    They improve both safety and mpg, at a cost that’s paid back with fuel savings.

    The future is carbon-fiber composite, for safety and higher mpg.Lots of info, examples, etc at ‘Ultralight but ultrastrong’ PDF page 81 of 332, at http://www.oilendgame.com/ReadTheBook.html

  31. Wiseman
    Posted March 17, 2007 at 3:01 pm | Permalink

    This article said –“Chief executives of the major U.S. automakers are asking for government incentives and wider efforts to reduce oil consumption and carbon emissions. Fuel-economy mandates, slow sales and loss of market share to foreign competitors have the automakers concerned. Massive layoffs and plant closings are forcing major restructuring in order for the companies to remain viable.”

    I do not get it?

    I thought the automotive industries have developed into super conglomerations with oil corporations that tried to monopolize everything that is automotive in the United States.

  32. steve
    Posted March 17, 2007 at 3:50 pm | Permalink

    If the govt. had imposed carter era like rules for mpg. detroit would not be in the situation they are in now. The didn’t change and improvise because they didn’t want to make the investment, and now are paying for their shor sightedness. When Bush gives tax breaks for Hummer buyers, why build smaller?

  33. cosmos
    Posted March 17, 2007 at 4:41 pm | Permalink

    Reagan rolled back CAFE mpg standards in 1985 — because GM and Ford, unlike all the others, were too incompetent to meet the standard, and would’ve been fined.

    Written in 1990, 16 years ago,’Make Fuel Efficiency Our Gulf Strategy’http://www.rmi.org/images/other/Security/S90-26_MakeFuelEffGulf.pdf“Are we putting our kids in tanks because we didn’t put them in efficient cars? Yes: we wouldn’t have needed any oil from the Persian Gulf after 1985 if we’d simply kept on saving oil at the rate we did from 1977 through 1985.” (continues)

    It’s ironic, and sad. GM and Ford evaded a relatively small fine back then — and are going bankrupt now because they don’t make the higher mpg vehicles the market is starting to demand.

    The U.S. is addicted to imported oil, and involved in oil wars, because of Reagan’s action re CAFE. And the SUV/light truck “loophole”.

  34. J M Walker
    Posted March 17, 2007 at 6:04 pm | Permalink

    The car is here to stay. It ain’t going away. The thing to do is end the war, take all the money that would have been used for iot and apply it to education first, and traffic management/highway safety second.

    Use the power of congress to force the automakers to build safe, efficient cars. The technology is out there, but we are going top have to change our image of SUV as a necessary mode of transportation. Even hybred versions are not good enough. And this ethonol nonsense has got to stop.

    There is an excellent article on the opinion page on water in the western state. It points to legislation meant to buy water rights from farmers on a trade basis: Take two acres out of CRP and put one acre on no water.

    Guess what the problem is here? How about with the state controlling water rights, the little guys will bne shut out, mega-farms will reap the benifits, and the state will be able to direct this “save to aquifier” flood that is supposed to do the same, but will be instead will be diverted to “ethonal farms.”

    Boy, I can hardly wait for the return of the dust storm, both real and political.

  35. Jim
    Posted September 28, 2007 at 11:23 am | Permalink

    The US auto-makers used to make good cars. They maybe could still compete with Jap companies if they’d quit paying union workers outlandish wages for mediocre work. I won’t ever again buy an American car until the Auto companies produce one out of something other than “tin-foil”. If I lose my well because of ethonol plant’s water greed, someone besides me is going to pay.