Kill the Messenger - this time the LA Times

[tw]

From the New York Times of 23 April 2005

Bicoastal Blues for G.M. and Ford
Washington and Oregon plan to become the 9th and 10th states to adopt California's tough car emissions rules, forming an increasingly potent market for more fuel-efficient vehicles on the West Coast and in the Northeast.

The states that already follow California's stringent tailpipe emissions rules also happened to fall in the blue column of the 2004 presidential election: Connecticut, Maine, Massachusetts, New Jersey, New York, Rhode Island and Vermont. ...

Further pressure comes from Canada, which recently forced automakers to agree to substantial cuts in emissions of global warming gases; California has a similar plan that automakers are challenging in court. ...

... on the coasts the last two domestically owned automakers face their biggest challenges, with customers turning to competitors like Toyota faster than in the rest of the country. Together, Ford and G.M. controlled 49.1 percent of domestic sales last year, but according to Polk, their market share in the 10 states was 40.6 percent.

... G.M. is diverting engineering resources from passenger cars to rush a new generation of its largest S.U.V.'s into production, betting that new models will stimulate the market for big sport utility vehicles ...

"The reality is that both companies are heavily invested in large S.U.V.'s and both companies have more risk than they have opportunity with their current sales mix," said John Casesa, an auto analyst at Merrill Lynch. "There is a secular trend towards lower emissions and higher fuel economy, which can only be met with lots of technology investment and probably smaller vehicles. There's only so much you can do with a Suburban."

Since more consumption means higher gasoline prices, where is the logic in GM's planns. Those who lived through this kind of downturn in the 1970s can also appreciate what GM, Chrysler, and Ford's solutions were back then. They simply kept building more large vehicles with low performance, low mileage engines. History tends to repeat itself in 30 year cycles when we don't learn those lessons.