Decoding the Automobile – Where is the Industry Headed?

The past few years have been difficult on the automotive industry. Some of the factors that have stressed this industry have been the bailouts given to GM and Chrysler, the horrible earthquake in Japan, and the requirement of emission standards to change. Overcoming these circumstances have provided much success.

The industry took a hit from the market crash and was lifted by the bailouts. Then the earthquake hit and slowed down the recovery that has changed the way we define our transportation options. The US Automotive industry took a step back and looked at what the future was calling for in terms of direction. Where, what, and how all this would happen needed to be a long term change, not just body style change from year to model year.

Since the first automobile was created, either horsepower or family transportation has defined the way American cars have been built. In many ways this is silly, because you cannot physically measure horsepower – you can only calculate it. Many people want a comfortable vehicle and not just a mini van. Thus you have marketing at its best. Instead of supply meeting demand, creating demand to sell off a supply is what happened. Going forward, US Automotive manufacturers have listened to our cries for change and will define the size of the engine by a couple of different motivators. These changes will also be positive for the family rides.

Two ideas that will change in the automotive industry are: the amounts of torque the vehicle produces, and the number of miles per gallon (mpg) for travel. These will be the new ideas because of how the Federal Government has regulated emissions and how the public will accept this change. The more torque that is produced, the less mpg a vehicle will get, and the emission will rise with this production. Balance to perform the basic core task of transportation will be the new marketing focus.

The Clean Air Act has defined emission standards. It mandates that vehicles with high emissions will be limited for sale, based on a percentage of zero emission vehicles sold. Zero emission vehicles will be defined by how much torque they need to use in order to perform the job of getting the passengers to and from a destination. Why have the waste of extra weight and oversized engines burning up gas? Having just what is needed to do the job will save the consumer money and keep this waste of excess energy to a minimum.

The transition vehicle is the hybrids. The hybrids are currently on back order for many manufacturers because of the earthquake in Japan. Japanese manufacturers produce many of the major components for hybrid technology.

Then comes the all-electric automobile. Electric cars will need to be light, safe, and able to perform the role of getting people to and from work. The power grid is already changing with charging stations going up in different cities like Seattle and San Francisco. The purpose is to prepare for the wave of individuals redefining how and what they drive. The cost of gas will keep going up, thus continually increasing the cost of energy.

Focusing on how each one of us uses energy will define the direction of what the automotive consumer purchases. Less money spent on gas is more money in a person or family’s budget. Hydrogen fuel cell cars will be in the market soon also. This will also have a positive affect on our economy. The US automotive market is seeing the change, the transition is happening.

Going forward the US automakers are starting to see that lighter, more fuel efficient, and environmentally friendly vehicles are the future. The crash of the market woke them up to see what changes were needed and they have moved in the right direction. The earthquake has affected Japanese manufacturers. European makers do not see the change coming. The financial situation of Europe’s crashing financial market and Autobahn have not changed the mind set of what they are producing, thus allowing US auto makes to take the lead in The Green auto market. This change will help to solidify the US auto market for years to come.


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