The Big Three: Evolve or Die

14. November 2008 by Martin Suter.

Talk about conflicted. I filled up the tank this week and paid $2.09 per gallon of gas. It’s been a long time since a fill cost me under $35, and with the rest of the economy in the tank (no pun intended), a little part of me was OK with saving some money. But a bigger part of me is thinking: Stop the madness!

At $4.25 per gallon, it hurt to go fill up, and as a result, people’s behaviours changed. SUVs and pick-ups weren’t moving off lots, major car dealerships shut down, and those that manufactured the vehicles to feed this craving, The Big Three, have admitted that they’re no longer capable of being self-sustaining and are looking for government bailouts. Why are they dying? They have ignored innovation and resisted building high mileage fleets, choosing instead to convince the US public that it needs 8 cylinder, 8 passenger, 12 mpg behemoths that cost over a hundred bucks to fill.

Evolve or die. They didn’t evolve as the 20^th century came to a close, and in fact openly opposed evolution. It’s time to let the market economy do what it does, and allow the next wave of innovative start-ups room to transform the automotive industry in the 21^st century.

Politicians don’t do “tough love” well. No politician, blue or red, will risk alienating entire swing states, so I expect there will be some kind of package put forth. Personally, I think it’s keeping the patient with multi-organ failure on life support. Does anyone think that the tens of billions of dollars that will be spent to transform The Big Three or will we be extending the suffering? Imagine if, instead, a portion of that money was invested to build a national distribution system for renewables? Or hydrogen refueling stations?

The government needs to man up, and act with an iron fist in a velvet glove. Bail them out, if you must, but use it as an opportunity to avoid a national crisis that threatens our future.

1. Add a bailout tax of $2 per gallon, so that every American is paying a user tax commensurate with the vehicles they’re driving.
2. Tie all monies to real mileage targets that will make a difference, not the abysmally minor gains currently on the books.
3. Legislate that ten percent of all vehicle sales must by electric by 2015.
4. 50% of vehicles produced must be hybrids by 2013, etc.

Put some teeth in the package. Give the Big Three a choice: evolve or die.

Stop the madness.

That’s my .02!

Martin Suter

(martin.suter at iplicensing.net)

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