Tuesday, April 28, 2009

The reason the auto makers are in trouble.

It doesn't take a rocket scientist (or an automotive engineer) to figure out why General Motors (note the "general" in their name) is in trouble or why the others are scrambling to figure out why they're losing money hand over clenched fist. Look no further than the hybrid car market.
Let's start with the Nissan Altima and its little brother, the Nissan Altima Hybrid. The Altima has a base sticker price of $19,900 and gets (EPA estimated) 23mpg city and 31mpg highway.
The Altima Hybrid has a base sticker price of $26,650 and gets (EPA estimated) 25mpg city and 33mpg highway. The higher city mileage is because it's running on battery power. Even so, the extra $7,500 doesn't make sense when you figure in an extra 2 miles per gallon of gasoline. You'd have to be a hard-core tree hugger to shell out $7,500 and get literally nothing in return other than the satisfaction of running a car on batteries for a short time.
By comparison, the Versa and Sentra get 34mpg for a lot less money than you'd spend for an Altima, so if money is your chief concern (join the club by clicking here) then your dollar is better spent on something that consumes gasoline 100% of the time instead of something else.
It isn't just Nissan that is dropping the ball on this stuff. Ford, GM and the rest of them are not making a legitimate effort to convert Americans to hybrid technology. They're building the cars, but if they can't make them worth investing in, then consumers won't bother spending money on the technology. General Motors is closing down the Pontiac division. BFD. That's a division that should have been closed years ago, along with Buick. They aren't addressing the problem, and that's the problem.
I would have hoped that our government's bailout money would be better spent, but then, I have an inflated notion of the intelligence of our government. They gave out money to keep them in business, but it's been business as usual, and that isn't good enough. Mostly, this hybrid technology is what the late Rich Ashburn used to call "eye wash."
Hybrid's are odd and
I find it disconcerting.
Gasoline is King.

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