The Big Three are back on Capitol Hill, trying to convince lawmakers that they really, really get it this time and if they get just one more chance, they won't blow it.
The automakers are all but down on their knees begging for $34 billion in emergency loans to keep them from imploding, and they've mapped out business plans that promise to, among other things, bring us smaller, more fuel-efficient cars and hybrids.
To their credit, the Big Three are building smaller, more fuel-efficient cars. General Motors has more models that exceed 30 mpg than any other automaker, and it offers more hybrids than Toyota. Ford's new EcoBoost engines deliver a 20 percent improvement in fuel economy and a 15 percent reduction in emissions over previous engines, and its cars consistently rank among the best in build quality. Even Chrysler has finally gotten hip to the need to build hybrids. They're all looking ahead to plug-in hybrids and EVs as well, with the Chevrolet Volt plug-in being the most obvious example.
Despite this, Uncle Sam and taxpayers remain reluctant to rescue the automakers. Many people say Detroit has no one but itself to blame for its woes, so we ought not throw good money after bad. It's easy to see why they'd think that way. After all, the Big Three have rarely missed an opportunity to miss an opportunity. Here are five examples where American automakers completely dropped the ball.
1. Hybrids - The Big Three let Honda and Toyota beat them to the punch a decade ago, then sat on the sidelines, arguing hybrids were too expensive, they wouldn't sell, yada yada yada.
They were right. Hybrids were expensive. And they were slow to catch on. But the Japanese automakers showed patience, and they were rewarded. These days Toyota and Honda can't build hybrids fast enough to meet demand and the Big Three are scrambling to catch up.
2. Electric vehicles - All of the automakers — including Honda (the EV+) and Toyota (the RAV4 EV) — are guilty of pulling the plug on EVs prematurely in the late 1990s, arguing the technology was too expensive, the batteries unproven and the demand for such cars nonexistent. But GM lost the most with the EV1 debacle. You can argue the car was entirely too expensive and way too advanced for its time — "The EV1 was a work of art," one EV advocate told us. "And that was the problem." — but the fact remains GM held the future in its hands and threw it away.
3. Sports Utility Vehicles - American Automakers relied entirely too much on SUVs to pad their bottom lines. Yes, they were dirt cheap to build and allowed Detroit to make mad money. But the over-reliance on SUVs made the Big Three so fat and lazy they couldn't respond to — or couldn't see — consumers' sudden shift toward passenger cars. Japanese and European automakers cranked out a lot of SUVs themselves, but not at the expense of small and mid-size cars.
4. Fighting progress - the Big Three have had a history of resisting changes and improvements that, though they might be costly to implement, deliver dividends in the long run. A few obvious examples include seat belts, catalytic converters and airbags.
5. The Partnership for a New Generation of Vehicles - Back in 1993, the federal government invested over a billion dollars in this program, which was a partnership with the Big Three to develop cars that could deliver up to 80 mpg. They did it, too. Each of the Big Three developed concept cars that topped 70 mpg. None of them were cheap, and none of them would have been easy to manufacture. But they showed what was possible. Who knows where they might have led us had the Bush Administration not killed the program in 2001 — at the request of the Big Three.
Photo by General Motors.
