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Gas Guzzling Cars Will Drive American Economy Into Ditch May 2005Any national energy policy that does not include and emphasize energy conservation is worthless. The oil industry does not want conservation because it means less revenue. The American auto industry's opposition to government-mandated fuel efficiency standards and emission controls is self-destructive.Failure to adopt a national energy policy based on energy conservation and non-polluting energy alternatives will result in continued dependence on foreign oil, environmental decay and economic decline. American manufacturing will take another huge and possibly irreversible hit if Ford and/or General Motors collapse because of their irrational reluctance to embrace more efficient fuel standards. This is a very real and scary possibility with GM losing $1.1 billion in the first quarter of this year. Ford and GM problems are the result of years of production of inferior, less reliable, less fuel-efficient vehicles than their foreign counterparts. Over the past 35 years, the domestic market share of these two U.S. automakers has declined from about 70 percent to about 45 percent. Sales of hybrid vehicles rose 81 percent in 2004, and Japanese manufacturers account for more than 96 percent of the hybrid vehicles registered in America today. By 2010, hybrids are expected to capture 7 percent of the U.S. market. About 60 percent of GM's vehicle models are gas-guzzling SUVs and trucks. GM and Ford should be leading the world in innovation, style, quality, reliability and fuel efficiency. Instead, they are miles behind. If Ford and/or GM go bankrupt in the next few years, they will take down hundreds of other American manufacturers that are their suppliers. Being an American automotive supplier now is extremely difficult. Profit margins are razor thin, and Ford and GM refuse to absorb price increases from their suppliers although production costs continue to rise, and in some cases skyrocket. The price of steel, for example, has almost doubled since January 2004. The U.S. economy cannot afford to absorb the collapse of one or two of the largest manufacturing companies in the country along with hundreds of their suppliers. The loss of jobs and income to the Northeast and Rust Belt could be devastating, and the implications for the Rochester- and Buffalo- area economies are potentially disastrous, particularly in light of the problems Eastman Kodak Co. is also facing. Americans must insist that Congress immediately pass and President Bush approve an energy bill whose focal points are energy conservation and nonpolluting energy alternatives. We've already wasted too much time. Donofrio is controller at a Rochester manufacturing company that is a supplier to the auto industry. | ||
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