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Friday, August 04, 2006

The Truth About Cars - SUV’s: The Worst of All Possible Worlds

By Robert Farago
August 2nd, 2006

Speaking of sports utility vehicles, consider the philosophy developed by Jeremy Bentham. Utilitarianism identified pain and pleasure as the only absolutes and declared that “whatever brings the greatest happiness to the greatest number of people” is, well, great (even if it isn’t so great for the people who don’t make the cut). By this standard, America’s gas-guzzling SUV’s were once a very good thing; the lumbering behemoths brought the majority of American motorists tremendous, not-to-say guilt free pleasure. And then, they didn’t. And now Detroit’s feeling the pain.

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In July, GM’s truck sales slipped 31.2%, Ford’s fell 44.8% and Chrysler’s dropped 41%. Obviously, the whole SUV thing is on the skids. Sure, thousands of Big Three executives and middle managers continue to hold a candle for the genre, hoping against hope that America’s automotive “fickleness” resolves itself, so that the gold rush can resume. But any rational person knows that the winds of change have blown that candle out. Any car company with a truck-heavy sales mix, any automobile manufacturer without a competitive line of cars, is, as they say, shit out of luck.

Baby, baby, baby; where did our love go? The simple answer: gas prices went up and truck buyers bailed out. The more accurate answer: Americans were bored of their SUV’s long before triple digit refills. The rising cost of gas simply cranked-up the average SUV buyer’s automotive ennui. I mean, why pay a premium at the pump for something you’re not so crazy about in the first place– especially if it’s trying to kill you. Yes, there is that. I reckon SUV’s music died when the Ford Explorer burst tire rollover debacle debuted. The genre’s Marlboro Man image was revealed as something of a cruel joke. Customers started asking questions.

Like what the Hell am I doing driving an SUV? Take away the SUV’s mantle of invincibility and all you’re left with is a large, tippy-over feeling, fuel-sucking vehicle that’s not very good at carrying kit and caboodle and damn hard to park. Obviously, some buyers drove SUV’s because they were the best vehicle for the job, a cheap way to tow, ford (small f) and schlep through challenging terrain and conditions. But the majority of SUV owners were simply indulging in an automotive fad. When the vehicular fashion statement was [literally] up-ended by thoughts of death, it was only a matter of time before it completely lost its luster.

Even as the SUV boom boomed, the media and social groups sowed the seeds of its demise. They demonized SUV’s for their lack of safety (and killer prows), environmental damage and prodigious thirst. It was the anti-fur thing all over again: a small group of highly motivated activists forcing a sea change in public perception. The anti-SUV groups’ one-two-three punch set ‘em up, gas prices knocked ‘em down.

These days, the SUV’s owners face a new problem: how to ditch their trucks when everyone else is trying to do the same. Trade-in values on SUV’s are so low they’re laughable– unless you happen to hold paper on one. Which creates a vicious circle; if you get burned on your old SUV, you sure as Hell ain’t gonna buy a new one. As hard as it is to believe, Detroit has an even bigger problem than how to coax SUV buyers out of their old rigs into a new one without giving all the trucks’ profits away. Now what?

Now nothing. The Big Three’s mainstream products are on a three year development cycle. We’re not even a year into Detroit’s realization that yes, SUV sales have tanked and they ain’t coming back. (“We’re selling Tahoes as fast as we can make them” Bob Lutz. 3.1.06) While the automakers are rushing new cars and strange beasts (i.e. crossovers) into their lineups, hoping to catch the “next big thing” before they’re sucked into Chapter 11 or divestiture, these non-truck products must compete against lean, mean competitors who own the car market lock, stock and market share. And as much as they’re trying, the Big Three can’t simply shut off the SUV spigot. Inventories of unsold SUV’s will get a lot worse before they get any better.

What a travesty. While American liberals feel vindicated at the mere mention of the Bush administration’s “intelligence failure” in Iraq, few auto industry reporters have made much of Detroit’s abject failure to anticipate the shift away from SUV’s. This despite the fact that all three Detroit automakers shell-out tens of millions of dollars to Armani-clad consultants to detect, analyze and forecast consumer trends, to create forward planning. Clearly, Detroit no longer knows how to bring the greatest happiness to the greatest number of American consumers. And that means that they're not so great anymore.
SOURCE:
The Truth About Cars SUV’s: The Worst of All Possible Worlds

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