Manufacturing 2.0
Rock River Valley manufacturing experts discuss the many facets of manufacturing: technology, education, training, events, people and any other aspects of this important segment of our economy. They’ll use this blog to get the word out and solicit feedback on local and global manufacturing. They hope to better engage our employers, employees and our future work force and increase their understanding of manufacturing.

Archive for June 5th, 2008

Gas Guzzlers-Part II

Add comment June 5th, 2008

It’s clear to me that there are other factors why the Asians have more fuel efficient autos.

1. Asians, like Europeans, have had much higher fuel costs than Americans for a long time. Higher taxes are assessed in these countries to fund many of their government programs. Maybe these companies started on these designs long before we did to economize for their markets. Then, when the market changed in the U.S. they started building here. It’s also interesting to note the number of Asian auto plants located in the U.S.

2. Typically, streets and roads are narrower in Europe and Asia than we enjoy here. Ever driven down a country lane in England? Ever driven in Turino, Italy?

3. It’s been well documented that big cars are more profitable than small cars. Shareholders of corporate stock want to see their stock prices go up, not down and that’s a partially a function of profitability. Individuals and many retirement plans are invested in the stock market. Would you rather earn 8% in the market or 4% at the bank? In the end, stockholders are the boss.

4. Most Americans want bigger and better and of course, they are the market. Walk through any sports park, shopping mall and what do you see? If U.S. auto companies listen (at least in part) to the market and their stockholders, then maybe what we want is what we get.

Too bad the stockholders, managements and marketing gurus didn’t see the run-up in fuel costs sooner.