Question of the Day: Where Will Carmageddon End?
What a doozy. Our coverage of Black Tuesday– which has nothing to do with Senator Obama wrapping up the nomination– has been long, hard and bloody. Farago and I attempted to get a grip on the financial fiasco in yesterday's podcast but made little if any headway. The story, in case you missed it, is this: Detroit is fucked. The only thing more dead than Hummer is Chrysler (it just doesn't want to admit it yet). The Ford F150 got outsold by four different cars. GM's trucks and SUVs aren't doing any better. Sales are down, down, down. Except for Subaru, whose symmetrical AWD cars have seen sales increase for three straight months. Go figure. My question for you is, what happens next? Besides layoffs, buyouts and plant closures. Federal loan guarantees? And then what? What will the American automotive landscape look like in… 2010? Look deep into your crystal balls people. We want the future.
Cleanup driver for Team Black Metal V8olvo.
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While I'm also an armchair general, wargamer, and fan of WWII tanks, let's keep in mind that: - nowadays, the quantity of heavy material in the army is far lower than during WWII - said material is built mostly by specialized companies, not large carmakers - the real strategic industry is in electronics, not in in ground vehicle building. A single predator drone flight now uses more bandwidth and computing power than the entire air campaign during desert Strom in 1991. The idea of building thousands of tanks and launch them at another army of tanks crashed along with the Berlin wall.
All automakers are bought out and taken over by Milo the Wonder Dog. Dogs start wearing hats, berets, and scarves while driving their loyal and loving owners wherever they like. All cars come with 'I-Bark' which allow cars to understand the dog's commands. However most dogs can't stand the little bone that's used to direct all the 75,876,321 commands. The bone is replaced with a squishy toy. All front and rear consoles are replaced with fire hydrants. Clinton's old cat Socks comes back from the dead. Socks overthrows the government and puts GWB and Dick Cheney back in power. The United States invades Mars... and loses.
"It will be the 1980’s all over again." I doubt it. What is different this time is the rising consumer economies inside China and India. India has about 1.1M people. China about 1.3M. The US, just over 0.3M. Between them a population about 8 times the size of the US' is buying gasoline powered transportation, many for the first time. Those who can afford it are getting refrigeration and air conditioning. Presently those populations use less than 10% the energy per capita as the US does. All they have to do is to inch up from 10% to 20% to keep the world supply:demand equation out of balance. Prices don't fall in a seller's market.