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The death of the Hummer?
GM shutters plant. Light truck sales plummet.Damn, these gas prices have some bite. American automakers, who depend disproportionately on sales of SUVs and light trucks, are getting hammered. GM saw a 28% drop in light-vehicle sales in May. Ford’s sales fell 16%. The Ford F-150, the most popular vehicle in the United States almost every year for the past three decades, was knocked off its perch by both the Toyota Camry and Toyota Corolla. Hummer sales fell by 60%! GM has announced the closure of its Janesville assembly plant, and the discontinuation of the plus-sized Tahoe, Suburban and Yukon lines as early as 2009. No word on the Hummer, but the buzzards are circling. GM will add additional shifts to plants that produce more fuel-efficient cars, and the company hopes to have the electric Chevy Volt in showrooms by 2010. (Update: GM is considering selling the Hummer brand. Solve Climate snarks about possible buyers.) (Update 2: David Leonhardt crunches some numbers in the NYT: “the difference between a Focus and an F-250 over five years is $60,000. The annual pretax income of a typical family in this country is also about $60,000. So choosing a F-250 over a Focus is like volunteering for a 20 percent pay cut.”) Bad news for Detroit in this case happens to be good news for the climate. Car purchases are sticky. Consumers may lose their passion for conservation after they acclimate to higher gas prices, but they’ll still be driving more fuel-efficient cars for years to come. Further, getting light trucks off the road is one of the best levers for reducing transportation emissions, much more so than getting drivers into hybrids. Thomas Friedman recently called for a $4 floor on the price of gasoline. This will never happen, but it’s easy to see why such a policy would be more effective than CAFE could ever be. Image by Flicrk user scottfeldstein. Tags: Gas guzzlers, Gas prices
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Comments2.
Comment by Chad
@ Jun 4, 2008 3 AM
 This is what I have been arguing for years: price increase (via tax or any other mechanism) are a much more effective method of increasing efficiency than CAFE standards. I remember seeing analysis once by the Congressional Budget Office that a carbon tax would get the same improvements as CAFE at 23% less cost…yet politicians are heavily in favor of the latter, in deference to ignorant public opinion. 3.
Comment by Jim
@ Jun 4, 2008 4 AM
Here I sit in France where we just filled up for 88 Euros (around 135 dollars). Ouch! But, we do think before we go driving off over the horizon. The U.S. wants cheap gas so we can simply waste it. How insane is this? Let it hit 8 dollars a gallon and we will see some REAL difference in our collective behavior (and emmissions). Everything is driven by money. Jim from Oracle, Arizona 4.
Comment by Linda
@ Jun 4, 2008 5 AM
I am delighted to hear that the Hummer 5.
Comment by Troy Banther
@ Jun 4, 2008 5 AM
I would absolutely love to trade my little 2000 Chevy Metro in for a more fuel-efficient hybrid or an all-electric vehicle. Out here in rural New Mexico the distance between villages, towns and several large cities is significant. These vehicles need to be rock solid stable and worth the cost. GM’s also getting its new hybrid Volt ready, and not a moment too soon. Meanwhile, Rust Belt cities like Pittsburgh are growing CSA community gardens in the healthy land in their old deserted neighborhoods, and using the polluted brownfields to grow biofuel crops like sunflowers that lock up carbon, leach toxins from the soil (bioremediation!) and provide biofuel feedstocks. Win-win-win. Dang, make that the electric Volt. Need. More. Coffee. Ha!! I hate those Hummers!! I see ONE PERSON driving them to work and think, “How selfish are you?” They hog parking spaces, use unreal amounts of gas and are a joke in city driving. I have not met one person who thinks it’s a good idea and have noticed less on the road, lately. It’s another case of “I’ve got a bigger something than you” and usually bought by people who are struggling to pay for them, too! Although gas prices have gone up and caused people to pay higher prices for everything, it’s the kick in the head (hopefully) for people to be more green. For every action there is a reaction, for every negative there is a positive. Hopefully, the tide will turn. 9.
Comment by J
@ Jun 4, 2008 7 AM
While I agree that this is all good news, lets not forget that there are Americans who are losing their jobs becase of the poor decisions the leadership of their companies made. Let’s be a little less overtly gleeful, and take the victory maturely, and with respect for our fellow citizens. 10.
Comment by John
@ Jun 4, 2008 7 AM
I agree that it is sad that people are losing jobs; however, it is hardly consistent with the current social contract to put all the blame on the company. These employees have had plenty of time to read the writing on the wall, take control of their future, and create a more stable career for themselves or at least a plan once the company crumbles. It is neglect if anyone in this day and age believes that they can coast at one company for the rest of their careers the way that people did two generations ago. While the obvious story is the idiocy of these companies, the remaining employees do not draw much sympathy since they for the most part are sticking to the old union model even though it is clearly out of step with current economic reality. 11.
Comment by Troy Banther
@ Jun 4, 2008 7 AM
As much as the automaker elites would like to blame this on others it is actually a failure of vision on their part. People have and are loosing jobs because the managers chose either to ignore or was in denial that fuel cost would rise to the point where it would cripple their industry. The Japanese have been actively working on fuel-efficient vehicles for a long, long time. I would like to have a small car, much like my Metro or smaller, that has huge fuel savings. 12.
Comment by Kevin Wright
@ Jun 4, 2008 7 AM
Let us also remember that this is only temporary. The market has only adjusted to what gas prices should really be (adjusted for inflation we are still getting off cheap compared to 30 years ago) and will go down again. When election time comes you will see a drop and once we have a new administration (pray for the brother) and the USD$ is worth more than dirt the prices will also go down. I would not be surprised by $3.00 per gallon gas again. Also, once the people get used to the high price you will see a resurgence in large vehicle sales. We have gone through all of this before, and not just once. I’m only 33 and I’ve seen it twice in my lifetime. You all give americans more credit than they deserve, stupidity will prevail once again. 13.
Comment by Gord
@ Jun 4, 2008 9 AM
How foolish are people to blame just oil and auto companies.What about our elected officials policies regarding polution regulations in respect to the fuel and auto industry?Seems as though money really talks,especially in regards to lobbying.Europe and Japan have tightened up their laws, with the auto the industry following suit.They don’t have work problems like we do ,with layoffs,high wages and health costs.Alternative fuels with effeciant mods of transportation have been over seas for decades.How about this side of the pond?? 14.
Comment by Jim
@ Jun 4, 2008 9 AM
It should be legal to shoot at a Hummer. After all, this is what they were designed for. 15.
Comment by TimW
@ Jun 4, 2008 9 AM
Don’t forget a possible feebate system. Most people don’t have spare capital to buy the more expensive fuel efficient machines that might ultimately save them more money. Raising that spare cash is a hurdle. The feebate system takes a fee from adding a Imagine Bush’s stimulus package had been contingent on it being spend on energy conservation/fuel efficiency.. 16.
Comment by Aaron A.
@ Jun 4, 2008 11 AM
Chad and I don’t normally agree on much, but I like this: Yeah, that’s public perception for you. Phoenix Woman: I’m eager to see the Volt too. If Chevy lives up to its own marketing hype, I could go months without stopping for gas. — A. 17.
Comment by Matt
@ Jun 4, 2008 1 PM
Shoot at Hummer’s??? Americans are getting more credit then they deserve???? Stupidity will prevail??? 18.
Comment by Troy Banther
@ Jun 4, 2008 1 PM
I thought the “shoot at the hummers” was actually a little funny. It was funniy since most of the people in this area of the U.S. drive with a “boot” on their head and a gun rack in the back. The “boot” on the head is a “FarSide” reference for “Natures way of telling others to leave this person alone.” I do find from simple observation that very large people who drive Hummers, SUVs and huge pick-up trucks drive alone, read as one person, into McD’s, BK, DQ and other fast food places. I guess a super-sized vehicle to buy a super-sized meal for a single super-sized butt. Anyways, back to the point. I’ve learned to let the comments roll off and away. I am an American and yes, maybe, some of the criticism is justified through other people eyes and the way they see or interpret the world. Everyone should know though that there are many, many Americans who don’t fit the “Typical American” perception. I drive a small vehicle only when I must. Live a wabi lifestyle. Actively work for a greener world. Gas prices will vary, and demand for large vehicles will follow, but the trend is clear: public awareness has reached a level that gas guzzlers will never return to the levels of demand they once saw. This is what the market is supposed to do. With heightened consumer awareness - not to mention taxes and regulations that are coming down the pike - emission-heavy products of all types will gradually fade way. Finally! 20.
Comment by Charlotte
@ Jun 4, 2008 7 PM
[Ed. — Charlotte, please go be sick elsewhere.] 
Um, how did $0.50 cents more per gallon over the next 30 years turn into forced migration to Siberia? Gas is up $2 in the last two years! We’re going to need trucks from some time. All we’re advocating is a little pricing to make folks that don’t need trucks a little gentle push to buy a more efficient car instead. 4 cylinder, not 6. Car, not SUV, that sort of thing…. 22.
Comment by Jim
@ Jun 4, 2008 11 PM
Matt No. 17 Hey Buddy, you really should lighten up a bit. Nothing ever gets done without retaining one’s sense of humor. Jeeze… My wife and I have been cheering every time we hear gas prices hit a new record, and of course every time one of GM’s (or Ford’s or even Toyota’s) stupid, short-sighted decisions comes back to bite them. But lately, a more stark reality of these impacts is being felt: people are losing jobs, and costs for basic living are increasing dramatically. We’re not cheering so much as we are hoping that these changes will wake up the politicians. It’s easy to say that people working on GM assembly lines should have used the opportunity to see this coming and get new jobs. But this is not a reality for most people; it would require a massive life change, including spending money learning a new skill, and most likely moving to a different part of the country. It is truly elitist to blame people for being short-sighted. I wish everyone were enlightened, but they are not, and even the enlightened of us have to make a living. I don’t think we can put much blame on hard working Americans. We are mostly just doing what leaders have said we should do: consume. The blame should go squarely on our politicians who have largely failed (over the last 20 or 30 years) to accept, or at least begin to understand. The problem was obvious to a few smart people for quite a while (Amory Lovins, Peak Oil advocates, Global Warming scientists). Politicians need to do what politicians are supposed to do: explain abstract problems to the country, like global warming, energy shortages and provide a sensible plan to use the problem as an opportunity to make the country stronger. The positive message is clear and simple, echoed here at TerraPass, the Rocky Mountain Institute, Environmental Defense, and numerous other “non-fringe” organizations. The message is: economics can work to solve this problem and make America stronger. It will require something like a carbon tax, or cap-and-trade, or whatever it is that causes the true cost of our use of fossil fuel to be recognized in its price. And now that people are beginning to feel the pain of inaction, our politicians and activists need to sell the idea that what we’re going through now is just the beginning of a big change. We have two choices: let it happen to us, or figure out how to take advantage of what is perhaps one of the biggest economic opportunities of the last 100 years. Inaction will result in unpredictable and extreme pain. Action will result in predictable, gradual change that will require some adjustments. I choose the second. We need leadership, inspiration, and someone who can truly explain the situation to the people in the country. And it would be good if we got it before January 2009. Tom 24.
Comment by Bob
@ Jun 5, 2008 12 PM
Tom No. 23 “We need leadership, inspiration, and someone who can truly explain the situation to the people in the country. And it would be good if we got it before January 2009” We will have this person very soon… 08ama! 25.
Comment by Martin from Canada
@ Jun 5, 2008 7 PM
Adam Smith was a very smart man. He was the economist from a long time ago that said (in effect) that the invisible hand (the market) should be allowed to work without interference. 26.
Comment by Troy Banther
@ Jun 5, 2008 9 PM
I have absolutely no argument with Adam Smith. He is correct. I choose, as part of the free market, to withhold my payment for gasoline until I actually need it. My goal? To make oil have near zero value on the market. We don’t need a Republican or a Democrat to fail or over-control the markets. As a person who has a strict interpretation of theConstitution the U.S. president’s job is to obey Congress. To execute Congressional will. The days of the Imperial Presidency died with Nixon. Back to the topic. I choose, again as part of the free market, not to purchase a new vehicle. Especially, a Hummer, SUV or a super-sized utility truck. My “paid for” 2000 Chevy Metro, which may be a little worn, is in excellent shape. I can also walk as-well-as ride a bicycle. My goal? Not to give in to the latest and greatest “thing” from the automotive companies. My goal is to live a wabi-sabi lifestyle. Having a new car, while it is nice, is not the path I choose to walk or drive. I choose, yes, I love having a mind to think and choose with, not to celebrate Father’s Day and many, many so-called holidays. My free hand to the market does not have money in it to such things. If there is no demand, there is no market. Also in Adam Smith’s free market environment the buyers and sellers do not coerce or mislead each other nor are they coerced by a third party. I ask myself, as many other are, is there third-party manipulation of the oil markets? Post a commentSearch the TerraPass blogTurn your old cellphones and PDAs into a FREE TerraPass. |
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How about an $8 floor? It seems like it would take at least that much to internalize the externalities associated with driving.