By on June 9, 2008

jacksonspeakshl.jpgThe Wall Street Journal reports that Michael Jackson is joining a growing chorus shouting "take your medicine." No it's not MJ handing a can of Coke to a young fan. It's the CEO of mega-dealer AutoNation, who thinks "high gas prices are good for the U.S. auto industry." Just as Scott McClellan trash-talking the Bush administration, Jackson is biting the hand that feeds. "We are highly skilled at selling size, horsepower and speed at a premium price, and giving away fuel efficiency," Jackson opines. "Now, going forward over the next 10 years we are going to have to convince consumers why they should pay more for a smaller engine, or some new technology, that is going to give them a tremendous benefit on fuel efficiency." Surely it's a new day in the US of A when the top car salesman in the land embraces the challenge of selling fuel efficiency. Who's bad?

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14 Comments on “Auto Nation CEO: High Gas Prices a Good Thing...”


  • avatar
    bunkie

    Wow. I’m stunned. A salesman stating that what sells sells. Brilliant.

  • avatar
    AKM

    He’s simply a smart, shrewd businessman who knows which way the wind blows, and want to make sure he not only stays in business, but takes business away from competitors who rely on outdated business models.
    I don’t see how that is “biting the hand that feeds”, as he doesn’t target any car company in particular, and simply acknowledges that the era of cheap fuel is gone, at least for now and probably for good.

  • avatar
    qa

    I think our mobility and lifestyle choices will eventually match up with the rest of the developed world where gas is even more expensive at ($9-11/gal). Yet notice the traffic congestion in those nations. So yes it should be good for the auto (and oil) industries.

  • avatar
    ttacgreg

    If oil is indeed a bubble that will pop, causing the world market price to fall substantially, what should we do?
    1. Party on! Screw efficiency!
    2. Apply taxes that support prices where they are at, thus encouraging efficiency, and pour that money into infrastructure, and transitioning to alternatives?

    Personally I think #2 is the right thing to do, and I thought back in 80′s when oil prices collapsed we should have done that back then. Think of where we would be now if we had.

  • avatar
    ttacgreg

    In fact, if I were king, I would apply an ever increasing light to moderate tax on all non renewable energy resources, and use the money to facilitate transiton to renewables. The steady, predictable economic changes this would impose would be something that could be dealt with more successfully than allowing “free market” swings deliver sudden, painful blows to the economy.
    Additionally in times of huge world market price swings, the tax could be callibrated to be reduced in those times to cusion the economic impact of such spikes.
    Or we could just go totally free market, let huge money interests buy off the government, have them drag us into resource wars, plunder the earth, all the while milking us dry for their profits. Oh wait! That’s what we are doing right now!

  • avatar
    taxman100

    I would tax all imported oil, and open up the majority of federal and offshore lands to energy exploration and production. The tax would be used to pay for the Iraq war.

    I would also encourage the production of nuclear and wind energy by making the regulation of such reasonable.

    Of course, the environmentalists really don’t want energy independence – they want to change our lifestyle to fit their ideals of them telling you how to live.

  • avatar
    ttacgreg

    Mr, taxman100 sir,
    How does your ideas move our country, and humanity towards renewable energy sources? Do you value long range and historical perpsectives? Truely sustainable industrialization ultimately needs to be enviromentally and biologically benign as possible, and renewable.
    If fossil fuels were indeed unlimited, just how much CO2 can the atmophere take?
    Please describe how you would deal with nuclear wastes, as well as the sites upon which nuclear plants are built? And what about the weapon material plutonium they produce? Don’t tell me they can be accounted for, humans are imperfect. Our airforce’s accidentally shipping missle warheads across the land on a B-52, or off to Taiwan pretty much settles that arguement I sincerly desire that humans survive for many more millenia. Ain’t gonna happen in the face of blind grasping greed and attachment to material things.
    And sir, I genuinely do want the USA to be independent of foreign energy sources. We would not need to spend our wealth on a monster military and over 170 military bases around the world. Think about what we could do with that money!

  • avatar
    rtz

    I was out cruising all weekend. Way less traffic and there’s not 75 police cars out and about anymore!

  • avatar
    geeber

    ttacgreg: In fact, if I were king, I would apply an ever increasing light to moderate tax on all non renewable energy resources, and use the money to facilitate transiton to renewables. The steady, predictable economic changes this would impose would be something that could be dealt with more successfully than allowing “free market” swings deliver sudden, painful blows to the economy.

    European countries heavily tax oil, but they have experienced price increases, too. I just read last week that there are increasing protests in France over rising gasoline and diesel fuel costs, even though their gasoline and diesel costs have increased by about 90 percent over the past 4-5 years, while ours have gone up 170 percent during the same time period.

    Your plan would not necessarily bring about steady, predictable economic changes.

    ttacgreg: Additionally in times of huge world market price swings, the tax could be callibrated to be reduced in those times to cusion the economic impact of such spikes.

    This will never work, because, in the real world, government quickly becomes addicted to the revenue generated by fuel taxes, and thus isn’t about to forego them just because fuel prices rise. European countries have had high gasoline taxes for decades; I don’t see any of them rushing to institute meaningful tax reductions to give people relief at the pump.

    Why not? Because those governments are highly dependent on the revenue from fuel taxes to pay for spending.

    ttacgreg: Please describe how you would deal with nuclear wastes, as well as the sites upon which nuclear plants are built?

    Please explain how you are going to ensure the widespread availability of electricity without relying heavily on nuclear power, if you aren’t going to use fossil fuels.

    And don’t say conservation – that won’t provide sufficient savings, unless people give up air conditioning and drastically lower the thermostat during the winter months.

    File that one under notgonnahappen.com.

    Nor will wind power (not reliable and steady enough, plus lots of environmentalists oppose windmills) or solar power (doesn’t generate enough electricity, and most areas don’t receive enough continuous sunlight to generate substantial power).

    ttacgreg: We would not need to spend our wealth on a monster military and over 170 military bases around the world. Think about what we could do with that money!

    We could give it back to the taxpayers, and they can decide how to spend it, as it’s their money in the first place. That’s a good start…

  • avatar
    ttacgreg

    Hello geeger!

    Is it an absolute that government gets addicted to the money? Do we the people not in theory put these people there by electionns in the first place?
    I thought of Europe as I wrote that, thanks. As you pointed out Europe does have earmarks on those petro tax dollars. My plan is my plan, not the current European one.

    You did not answer the nuclear waste and site clean up, did you? :)

    Your arguments appear to be quite set into current thinking and paradigms. Thinking out side of the box is needed here. Solar is highly expoitable, all it takes is imagination creativity, inventiveness, comittment, and cultural change to accomplish.

    Much of the US history has that can-doism running through it. We imagined things, changed our culture, our infrastructure, and invented new lifestyles.

    Now we appear all locked down into clinging to the past. It is a prison we need to set ourselves free from. Is not one of the stereotypes of Amricans is that we are inventive?

    Sir, one can assuredly set oneself up to be made a fool of by saying “never”.

  • avatar
    97escort

    High gas prices are a good thing, but not for cars. We only have to look at the latest report on cars sales to see the effect of high gas prices.

    High gas prices are especially dangerous for the auto manufacturers who have nothing competitive in the fuel efficient small car segment. The American 2.8 have fumbled the ball again as usual and are being left out of the sales game or what is left of it.

    They are in for very tough times and may not survive. They have no one to blame but themselves.

    Japanese auto makers saw it coming for the most part and prepared models like the hybrid Prius and Civic. They know about high oil prices and scarcity since Japan must import all the oil they use.

    All Detroit had to do was copy them as quickly as they made their move. Seems like the Prius has been available for 6 or 7 seven years now. But no, American arrogance and an unwillingness to change has been its downfall.

  • avatar
    chuckR

    How to take care of nuke wastes? Yucca Mountain. I’m not gonna worry about ridiculously improbable what if events. You absolutely want to get the radwaste out of the trenches at Hanford – and other places – and into a safe repository. Yucca will do just fine.

    How much more CO2 can the atmosphere take? Dunno and neither do all the AGW proponents baying after that sweet, sweet grant money, money awarded by politicians who are mostly after more control over everyone’s lives. Don’t believe those researchers don’t know? We have scientists predicting the climate 100 years from now. Show me a cite for their computer programs starting 100 years ago and successfully predicting today. They can’t do it. Hell, they can’t even conclusively demonstrate that CO2 is causative rather than a trailing indicator of warming. AGW is worse than a fraud, its a blunder in that we haven’t gotten even the outline of an energy policy from it.

    Solar, wind? Sure, but neither will provide a significant contribution over the next decade. People who believe (and that is the operative word) otherwise have no sense of proportion.

    Nonetheless, bring on higher efficiency cars. I look forward to fewer big trucks and SUVs careering down the roads.

  • avatar
    Geotpf

    Why are you folks talking about nukes and solar? Oil has nothing to do with electricity production in the continential United States. 99.99% or so of all electricity production in the US is made with things other than oil. Oil is used in transportaion (boats/planes/trains/motorcycles/pickups/cars/SUVs/buses/big rigs) and plastics/chemicals/fertilizer, but not electric power. Oil has very little to do with electric production.

  • avatar
    geeber

    ttacgreg: Is it an absolute that government gets addicted to the money? Do we the people not in theory put these people there by electionns in the first place?

    Unfortunately, yes. It appears to be human nature, which crosses party lines, for most legislators and government officials to spend every available dollar.

    Your intentions are certainly noble, but, as someone who works in government, I am guided by what I see happening in the real world.

    ttacgreg: You did not answer the nuclear waste and site clean up, did you? :)

    I believe that chuckR has answered that one…realistically, given current technology, we will not be giving up fossil fuels any time soon, and the one technology ready to take their place is nuclear.

    ttacgreg: Solar is highly expoitable, all it takes is imagination creativity, inventiveness, comittment, and cultural change to accomplish.

    Germany provides heavy incentives to encourage the use of solar power, and at this point it generates only 4 percent of the nation’s electricity. This is in a nation that lacks the extremes of climate experienced by most of the United States (bitterly cold winters, very hot and humid summers).

    Believe me, I’m all for solar power – if it’s feasible. But right now, it’s not ready for primetime, at least not on a large scale basis.

    ttacgreg: Much of the US history has that can-doism running through it. We imagined things, changed our culture, our infrastructure, and invented new lifestyles.

    Now we appear all locked down into clinging to the past. It is a prison we need to set ourselves free from. Is not one of the stereotypes of Amricans is that we are inventive?

    There is a difference between changes that result from the natural flow of innovation, and changes forced on society through regulations or poorly conceived laws. We “cling” to many things because no suitable subsitute – suitable on a cost basis, or on an energy-yield basis – has yet been found.


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