Over the last three years, “going green” and conserving energy has become cool, fashionable, and morally sound. But in all the hype, people are failing to realize that going green doesn’t necessarily mean going without. In the long run, conservation will never be the solution.
In a world of cheap energy, people bought big cars and SUVs. With oil prices above $100/barrel, the prevailing sentiment seems to that there has been a fundamental change of desire towards smaller cars. In a recent interview with Business Week, Bill Ford said:
“I’ve been an environmentalist my whole life, and I’ve fought a lot of battles during 30 years at Ford…. I don’t think we’ll ever see a shift back to [big cars and SUVs]… This is a permanent shift in the marketplace. “
While it’s somewhat refreshing to see major car companies acknowledge the changing realities of the market, jumping 100% on the small car bandwagon is really more of the same catchup that they’ve been playing for the last decade.
The fact remains, people like big cars. As long as this desire exists, there should be smart people competing to create technologies that make those big cars and SUVs affordable. In today’s world, this means building vehicles using energy systems that are far less expensive and more environmentally sound.
In fact, while it’s easy and fun to poke fun at the big US car manufacturers, all of them (and most international ones) have to some degree wised up to the inevitability of electricity as the optimal alternative energy system. In the next 24 months, GM, Ford, Toyota, and Honda all plan to release cars that are at least partially electric. And upstart Tesla Motors is already rolling cars off the production line as we speak.
The problem is that while the big car manufactures are taking steps forward, they are doing so at a glacial pace.
If people want SUVs, the future will be in making those SUVs. Investing 101 tells us: buy low, sell high. If you’re a car manufacturer and you want to step ahead of the crowd, the solution is not to kill your SUVs and big cars, but to invest more in them by rapidly transitioning them over to electric fuel systems. For a company like GM, this means pouring more money in a brand like Hummer, instead of selling it.
Now, this isn’t all so simple and easy. There are significant technical and logistical issues to be resolved, and all of these companies have earnings calls to worry about. But if the major auto manufactures don’t learn to anticipate what people will want in the future, they may not be around to see those vehicles being delivered at all.
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