The current state of the automobile industry – so grim and dismal, it’s grismal – is on one level very easy to explain. For a single fact reveals all: car sales have crashed, falling from about 17 million in the U.S. in 2006, to 13 million in 2008, to possibly less than 10 million this year. A laboratory mouse could do the math, but he wouldn’t like the result any better than you. Basically, no one ought to be shocked that Chrysler and General Motors – which firm managed to motor through the entirety of the Great Depression without a single money-losing season – went broke in 2009. What the loss of almost 50 percent of custom does for an industry’s balance sheet is never pretty.
But that’s only for starters. If things don’t turn around soon, America’s biggest losers won’t be in receivership alone for long. Nor will they be done losing money, because there’s plenty more to lose following bankruptcy, what’s left after you’ve legally dumped your brands, workers, and dealers and walked out on some hefty portion of your debts and other obligations with the court’s blessing.
No one can incinerate cash forever. So naturally, lots of time, money, and effort are being expended in Washington, D.C., and elsewhere with the goal of returning the car market to health, which is understood to mean historic sales highs or better. Cash for trash legislation, enacted in Europe and now kicking around Congress, is one popular solution, encouraging citizens to junk their so-called clunkers by offering cash incentives in the form of tax breaks to put down on new, more fuel-efficient models. The idea is rooted in the not-unsound notion of using tax policy to move the public toward cleaner, lower-consumption cars. Unfortunately, because the proposed legislation requires only mild fuel-economy improvements over the vehicle being junked (4 mpg for cars, 1 mpg for trucks), it is more accurately identified as a tool to clear dealer parking lots heaving with unsold pickups, SUVs, and other thirsty leftovers, rather than anything that’s actually going to significantly reduce pollution or demand for gasoline.
Fair enough, we help people buy pickup trucks that have already been built. Thus begin Honest Obama’s Dealing Days. But where does that leave us? Still breaking our collective hump to get people to buy more cars and trucks, many millions more, even ones that don’t get very good gas mileage.
It’s nice to aim for the stars, I suppose, and folks like buying cars. Why wouldn’t they? Cars are cool and often useful. And we’ve been prodded to want them by marketing, aggressive and subliminal, since childhood. Buying cars is what we know.
I like cars quite a bit myself, as you may have noticed. I restate the obvious here in the hope that you’ll not run for the pitchfork when I put to you this question: With car sales way off and the country desperately trying to reinvent itself, wouldn’t now be a fine time to consider whether we really ought to keep knocking ourselves out trying to make and sell so many? 17 million new cars a year? Given that we’re broke and looking for change, might we not be better off with less? Should maximum, unchecked, even artificially created demand be a central value of society? Should we be so anxious for people to buy things they don’t need and can’t afford? Is unbridled consumerism really the only way forward?
If you’re trying to save money, buying a new car less frequently than every five years could be a pretty good down payment on prosperity. At the same time, older cars create jobs for mechanics, repair shops, even dealer service departments. Don’t worry, cars won’t go away.
Washington’s allegiance to the automobile industry’s desire for ever-increased demand has been more or less unflagging since the 1920s, when auto lust supplanted Uncle Sam’s previously wholehearted support for railroads. Even the emergence of another government agenda – a longtime commitment to promoting airplane sales, at any cost – has not slowed the system’s distinct new-car bias.
Perhaps it is time for the government – and the rest of us – to revisit old truths and tired goals, in favor of sustainability and the refreshing notion of using what we have and buying new only what we truly need. The world has changed. Mr. President: tear down that (auto) mall.
Written by: Jamie Kitman
Illustrated by: Tim Marrs