Monday, February 13, 2006

What We Have Here Is A Failure To Communicate

Apropos of the Charles Groat interview I found earlier, I have to wonder what moron is in charge of coming up with the price estimates for oil over at GM and Ford. I actually subscribed to the Wall Street Journal earlier in the week, and lo and behold but here's their review following the Chicago Auto Show ($$$, of course) which has some whoppers:
The large-SUV market is about to experience a near-total renaissance, right on the heels of its disastrous 2005 sales collapse. General Motors is rolling out its new generation of large Chevrolet, GMC, and Cadillac SUVs. The new Cadillac Escalade, with its 400-horsepower engine and its chrome-jeweled exterior, was the star of a glitzy Super Bowl ad. And GM executives are talking up the early sales results for the new Chevrolet Tahoe.

That's to be expected from GM, since large SUVs are the money-losing No. 1 auto maker's primary new product this year. If they sell, GM stands a chance of significantly narrowing its automotive losses. If they don't, GM is in big trouble.

Well, look for that to be "big trouble", good buddy...
But overshadowed in GM's Big SUV hoopla is the fact that Ford is also launching a restyled and expanded lineup of large SUVs this year. Of special significance are new, extra-long versions of the Ford Expedition and Lincoln Navigator large utilities, designed to give Ford dealers what they have long wished for: "extended length" large SUVs to compete with GM's plus-sized Chevy Suburban and Cadillac Escalade ESV.
Are they for real? Does nobody pay attention to what the sales of Toyota hybrids are doing? At least the author of this piece, Joseph B. White, isn't entirely without a clue:
How much oil could we avoid burning if gasoline were $3 a gallon and consumers had an economic incentive to buy small cars that got 30 to 40 miles per gallon, or better, using ethanol, diesel or hybrid technology? Right now, it seems unlikely we'll get to find out. In the absence of a clear direction from policy makers or consumers, auto makers will hedge all bets, expanding the range of small, fuel-efficient subcompacts aimed at young buyers, and investing more in plus-sized rides such as the extended-length Navigator L at the same time.
This is obviously crazy. It's the a massive failure to misread the future direction of the market that essentially amounts to wishcasting by Ford and GM, and after this summer, I bet both come tumbling down.