Thread: Bailing out the Detroit automakers
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Old 11-24-2008, 05:00 PM
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Quote:
Originally Posted by Muck View Post
So the Big 3's problem was that they sold more vehicles than the competition and those vehicles were of a type that had a higher profit margin?

The solution was to sell fewer vehicle with a lower profit margin while the competition was investing billions in producing larger trucks & SUVs?

Got it.
I suppose your idea - going with the larger profit on increased buggy whip sales - is a good idea too.

Muck - you do know that the industry has opposed and obstructed CAFE standards for almost two decades. Groups like the Heritage Foundation (and Rush this morning) insist that freedom to buy any vehicle the market wants is essential to the system.

So I have to ask you, are you opposed to higher CAFE reqs, and do you think that we would be in the same fix as now if we had been developing more fuel efficient vehicles the last decade or two?

I grant you people did not want what high CAFE standards would require as much as they wanted the freaking SUVs - like the one I just bought.

But here we are talking about something that is more important than consumer preference. I mean, lets say the market would want land yachts that got 7 mpg. Assuming that is what the market wants, you cannot reconcile the need for less dependence on foreign oil with the market forces wanting less efficient vehicles. And in this case, it was the failure of the auto makers to take the long term medicine that was at fault. Had they been in a slimming mode for two decades they may have been better able to compete than now - when their inventory went up a zillion % in response to the high gas prices. Hell, when I bought my used Expedition they were offering 10K off on new Sequoias and about that on the King Ranch Expeditions. Crazy amount of inventory. Local dealers were not taking suvs as trade ins. That could have been avoided with a better product line, albeit forced upon us by the CAFE req.

And - yeah - we need better quality. I researched the Ford product for some time, and it has been getting better. The Expeditions were a Consumer Reports best buy - as was the sequoia - but I went with the Ford because it was 7K cheaper.
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