That’s the question that President Obama posed in his 100 day press conference.
The answer: According to the Washington Post, they (the Japanese) can’t make a profitable hybrid — even the Prius loses money! So, add on a few UAW work rules and legacy costs and you get a mega loss generator … probably supported by extensive government subsidies.
P.S. to President Obama — we didn’t invent the auto — the Germans did (ever hear of Mercedes Benz ?)
P.P.S. to Pres. Obama — hire a fact-checker
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Excerpted from Washington Post, “The Car of the Future — but at What Cost?”, Steven Mufson, November 25, 2008
Hybrid Vehicles Are Popular, but Making Them Profitable Is a Challenge
Sen. Charles E. Schumer said last week. “We need a business model based on cars of the future, and we already know what that future is: the plug-in hybrid electric car. ”But the car company Schumer and other lawmakers envision for the future could turn out to be a money-losing operation, not part of a “sustainable U.S. auto industry.”
That’s because car manufacturers still haven’t figured out how to produce hybrid and plug-in vehicles cheaply enough to make money on them.
After a decade of relative success with its hybrid Prius, Toyota has sold about a million of the cars and is still widely believed by analysts to be losing money on each one sold.
U.S. lawmakers want the companies to produce automobiles of the future, using advanced technologies and featuring hybrid or plug-in vehicles. But there’s no guarantee that the new business model would be any more viable than the current one.
Automobile experts estimate that the battery in a plug-in vehicle could add at least $8,000 to the cost of a car, maybe considerably more. Most Americans will be unwilling to pay the extra price, especially if gasoline prices languish around $2 a gallon.
GM will have to stake its future on Malibus, the Chevy Cruze, and much more conventional technologies.
“Do you bet on lighter, smaller, more fuel efficient but ultimately less profitable cars or do you hold back a little on technology development and look at new versions of existing cars.
”Many experts say that gas guzzlers will not fade away as long as Congress fails to impose higher taxes on gasoline to steer people toward fuel-efficient cars.
GM and other car companies, while preparing plug-in vehicles, are more likely to live or die based on the sales of conventional cars that get better fuel efficiency through improved transmissions, reduced weight or hybrid technology.
”There’s fluff and there’s reality … The fluff is the Chevy Volt . . . That’s not going to save GM in the next five years. What will save GM is more small sedans and more crossovers. That’s what people are going to be buying.”
Full article:
http://www.washingtonpost.com/wp-dyn/content/article/2008/11/24/AR2008112403211.html?wpisrc=newsletter
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