In my last post on this issue I wrote about the oil and gas industries. With this post I’ll cover their partners in market manipulation, US automakers.

The original Ford Model T achieved 13 to 21 miles per gallon and could run on gasoline, kerosene, and ethanol. It rolled off the assembly line more than one hundred years ago. But visit the web site of any US automaker today and you’ll find vehicles listed with worse fuel economy. I’ll admit that’s not a totally fair comparison. Cars today are far heavier than those of a century ago. But it raises an interesting question – how would today’s models compare on a mileage per pound comparison?

Fifty years ago, General Motors was the world’s most dominant automaker. The expression – what’s good for GM is good for America – was true. It’s wasn’t just a clever marketing slogan. At the height of its success, GM controlled fifty percent of the market – half of all cars sold. Today, they only have a twenty percent market share and are the number two manufacturer behind Toyota. And Toyota did that with fifteen hundred dealerships compared to GM’s seven thousand. During WWII, General Motors and the other US automakers transitioned their factories from auto and truck production to military craft, armaments, and equipment in a matter of months. It was an unprecedented reshaping of US industry like none other in history. But today the big three can’t even get out of their own way.

Since then US automakers have attempted to block every effort to improve efficiency, reduce emissions, improve safety, and more. They routinely fight government plans to raise CAFE (Corporate Average Fuel Economy) standards. As a result, cars manufactured in the US cannot be sold in other parts of the world. Europe, China, Australia, and others have higher fuel economy standards. How is it that other countries have been able to figure it out, but the best minds in America cannot? Honda, Toyota, and Nissan all have higher fleet mileage than any domestic brand.

With every government effort to improve safety or environmental impact, Detroit has used the time work argument that any change will increase cost passed on to the consumer. In 1994 when California was debating low emission standards they cried wolf again and claimed that modifications would increase each auto by $800. After the legislation passed the price tag per auto was actually $80.

Several years ago I attended a presentation by a Toyota representative where they acknowledged their products rely on a fuel with a dwindling supply. They understand and accept the fact that to be in business fifty years from now their cars will have to run on another fuel. They aren’t waiting for more crude to be discovered, they aren’t resting on their laurels, they aren’t waiting for someone else for figure it out for them, they are aggressively pursuing alternative locomotive options.

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