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The March 2009 Car Update

By Steve Jones,

Flying CarIt's time for another car update, and I'll start with a link that someone sent me about speeding cars.  Apparently  some cars get stopped more than others, as you'd expect. It might not be the models you think are targeted, however. I know I was surprised by a few. So is it that cops are targeting cars or that drivers with similar styles tend to drive the same models? I wonder… I'm just glad my 911 wasn't on the list :)

I had a whole other editorial written, but with some recent auto events, I wanted to comment on them. With the resignation of Rick Wagoner from GM, the short leash Chrysler is on to merge with Fiat, and Obama questioning the viability of the industry, there will be a lot of changes before I get to write another one of these.

What's wrong with the auto industry?

I really have no specific idea, other than it's a model that is out of date. The idea that enough people need to buy a new car every 5 years is preposterous. I think it's been a short-sited effort by so many companies over the last couple decades to keep building on the same system rather than rethink the industry. This quote might sum it up:  Detroit's goal has never been to sell the cars that consumers want to buy; it's been to sell the cars that will yield the highest profits. That's the case in many industries, and it's where markets fall down when there isn't enough flexibility for the consumer.

How do we fix things? First I think shrinkage is called for. I love cars, but larger and larger companies, trying to take advantage of economies of scale don't make for a nimble industry. The computer industry had similar issues, and still does. The DEC/Compaq/HP/IBM/SUN of the 80s don't work today, and arguably still need to evolve more. I will give kudos to Ford for not asking for bailout money and trying to build new designs and implement new ideas. I'm not sure if they're really re-inventing themselves or just doing more damage control, but they made a great statement yesterday.

I know we have distributed parts makers, and dealers, and lots of parts in the systems, but it appears from the outside that they're so regulated and tightly bound to each other that they've lost flexibility. I think independent companies would make more sense. What if we had separate companies that could do

  • Design companies that come up with new shapes, enhancements, and ideas, pitching them to a car "company." Look at the designs entered in theAutomotive X-prize.
  • Manufacturing plants that competed for business from any auto company. Why should Ford have idle plants if Toyota needs to build more plants? Shouldn't factories be able to re-tool quickly for a new model? Why not have building companies that build cars, trucks, or golf carts if someone pays them?
  • Customization companies - We should be able to customize new cars quickly and easily as well as enhance old ones. There's an industry here that could grow. Why can't the auto dealers work with customers here as well, rather than trying to sell new cars.
  • Dealers - Do we really need dealers linked to companies? Shouldn't we allow anyone to sell any car?
  • Leasing community cars? Is there a business model here, letting people lease communal vehicles for the day/week/month? It doesn't necessarily help the industry, but maybe they can derive some profits here instead of trying to grow by building and selling more cars.

I know there are lots of standards required of cars. Testing, certification, safety, emissions, etc. and these create issues. However there are way to share some of these costs, model more CAD/CAM, or even have the government "loan" money to companies to get this done, being paid back as models are sold.

I'd like to see more shared research as well, at least in the US. No reason why all auto companies in the US should be duplicating research. Japan allows some shared research under MITI, we should as well (as should other countries).

I think our unions, which have served a purpose at times, need to be restructured. Labor should be paid fairly, and in line with the work done. I hate to have pensions and promises made broken, but there does need to be dramatic work done from this point forward. We may get to that point in IT someday, but it's definitely here for the auto and financial industries. There are potentially lots of places to use displaced auto-workers in new businesses. Let them take their car knowledge and refurbish cars, renovate and repair old ones, or some other business model. I'd rather see bailout money going to smaller companies trying to get started or grow than the big 3 dinosaurs.

My son thinks we should move to these flying cars, however I'm not sure that I want more pilots in the air. We've had 3 crashes in 4 years at the rural airstrip 4 miles from my house and 3 at the small commercial airport about 14 miles away. People have enough trouble moving in two dimensions without bumping something, not sure I think they're ready for three.

I'm not sure what will happen, but I do think that dramatic changes are coming over the next decade in the auto industry. There are lots of ideas, and visions of where to go, but I don't know anyone knows how to get to a new vision for the industry from where it is today.

Steve Jones

The Prius Update

Numerous ski trips with the Prius this winter have worked out well with the roads being clear. I've headed away from home at a 48mpg average and often returned home with a similar number after going up and down about 5,000 ft. Gas is about $1.80 in the Denver area. I've added the one year comparison numbers as well.

Prius Stats

Months owned Mileage Avg MPG (current month) Conservative savings Realistic savings
24 43,800 48 (for Mar) $4,070 $4,819
12 20,500 48 (for Mar) $1,902 $2,253

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