The global auto industry is finished

[GliderGuider]

That includes the Big 3 along with the Japanese, the Koreans, the Germans, the French, the Italians, the Swedes and the Indians.

Within 20 years the USA is likely to be running on a third of the oil you use today, due to a nasty phenomenon related to Peak Oil called the net oil export problem. The face of your society will have changed as a result, and the one thing it will have moved away from very decisively is the personal automobile. In addition, for a number of reasons I expect the world to enter an essentially unrecoverable depression within two or three years (for my reasoning on that conclusion read this post).

That pair of factors make it enormously urgent to start thinking outside the box when it comes to jobs, manufacturing and the social organization that has sprung up around the automobile. I know many Americans are enormously attached to the auto industry, and I understand how difficult it is to think that an industry that created the nation you love may have become part of the problem. I also know that letting the Big 3 fail would be catastrophic for the US in a way that even bank failures are not.

However, letting the companies simply continue in their current form with taxpayer support isn't a solution. Consumers just aren't buying cars right now, and there is a distinct possibility that auto sales will never recover. If that happens, and the industry doesn't reinvent itself into something besides huge car companies with huge finance arms, and all the auto workers stay employed, the auto companies could end up running at a taxpayer-subsidized loss in perpetuity. That would be an intolerable situation for the economy as well, though it would take somewhat longer to manifest.

IMO the auto industry needs time, money and political willpower to restructure itself from top to bottom and change direction completely, because it's headed for a cliff. The problem is that all three of those commodities are in very short supply. We're heading into a depression as we speak, so time and money are draining away. Regarding political will, the industry (company and unions together) is powerful enough that it can influence the course of political events in its own interest, even if that results in a beggar-thy-neigbour position with regard to the rest of the economy.

The best solution I see is for the US government to take a major controlling interest in the companies. It could then use the leverage of ownership to force a change in direction that will be merely painful rather than catastrophic. It's obviously a socialist move, but that door has already been opened with the banks.

This is the situation as I see it. Unless someone can present something besides short-sighted bluster and verbal intimidation to counter it, I'll stand by it.

[Buzz Clik]

1. The auto industry isn't "finished", but their future is in doubt.

[Double T]

2. Free Market Capitalism could not control or govern itself; profits at all costs and.........

above anything else with no regard for society, the environment, finite resources and country absolutely does not work. Socialism and government controls will replace the free markets; it will be the only very slim chance WE will have for even a paltry economic and financial recovery. The seriousness of our crisis is currently being masked with bailouts and stimulus packages which are actually going to make the crisis even worse. The auto industry needs a complete reorganization and new thinking needs to replace the SUV/truck/crossover mentality with more of a 'Smart' direction. A 'Manhattan Project' for the auto industry would be a step in the right direction and the BO Administration can make that happen. Great Post and Links, thank you for your reason and sanity.

[dipsydoodle]

3. At least partial nationalisation

is probably the answer. Apparently the Europeans have already pointed out that a bailout would be illegal under international agreements which the USA helped create- see reply #16 here : http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3603459#3603557

As an aside - keep up the good work. I enjoy ploughing through your stuff.

[ensho]

4. the auto makers have ignored climate change. don't give them money

the economy and climate change are happening faster and faster.

[madrchsod]

5. how are we to go from place to place?

how are we to move goods from one place to another? i guess i`ll invest in horse and buggy futures

[wuushew]

7. I believe street cars could be retrofitted back into the existing road surface

nothing terribly high tech about electrified steel rail. Liquid fuels thus could be rationed for emergency vehicles, local freight delivery and construction equipment.

[GliderGuider]

8. In the short term there will be a shift to mass transit (especially electric light rail)

People who live in areas where this is not possible will either economize on travel any way they can, move, or simply devote a growing slice of their income to transportation costs.

In the long term we'll be doing a lot more staying in one place, just as our grandparents and great-grandparents did.

[juno jones]

6. Retool for mass transit

The numbers for transit use jumped when gas went thru the roof. They have remained high despite the falling prices. Get trains and buses going and expand systems. And keep going greener. It would be nice to put what's left of our industry and infrastructure towards building a future.

[Strelnikov_]

9. Mass transit does not save energy compared to the typical automobile

(20.5 mpg) in terms of energy consumed per passenger mile.

And since we are talking energy, that is what counts.

Mass transit, to date, has been deployed to alleviate traffic congestion and pollution (smog). With the population density we have attained through decades of development, mass transit is not energy efficient.

Following is the publication that caused me to dig into energy efficiency of mass transit.

Our urban sprawl has no precedent in history, so the feasibility of a mass transit system has yet to be proven – a true mass transit system for the U.S. today may, in fact, be impossible. In addition, the energy savings of mass transit, in the context of implementing such a system in today’s configuration configuration of cities and urban sprawl, may be highly overrated. Figure 6 shows that existing mass transit systems do not provide significant fuel savings.11 It depicts the Btus of energy per passenger mile (assuming average passenger densities) for each type of transportation.

11. Transportation Energy Data Book, 25th Edition, 2006, tables 2-11 and 2-12, Center for Transportation Analysis, Oak Ridge National Laboratory.

http://www.communitysolution.org/pdfs/NS12.pdf

Following is the raw data:

http://cta.ornl.gov/data/index.shtml

Following is the concept of what I think is the personal transportation future to serve as the collector from low density development to high load factor electric powered mass transit corridors.

[bean fidhleir]

10. Except for it being a delta rather than the more stable tadpole config

and the problem of battery vs internal combustion still not having been fully sorted, I'd go for it in a heartbeat!


A 25cc engine running on gasoline/alcohol/diesel can get 200 mpg while lugging 1 human + a lot of parcels - without even a proper gearbox.

A 50cc engine can do the same for 2 adults, a child, and parcels.

And when the engine wears out after 50K miles, can be fully recycled. I don't know how the fully-burdened cost compares to batteries since I don't understand modern battery technology at all, but I wouldn't be surprized if it were superior.