Is the Car Industry Going Nuts?

By Tom Ripley

Everybody I know who attended the North American International Auto Show in Detroit left Cobo Hall shaking his or her head.  In looking for common threads within the mind-boggling expensive exhibition of the latest wares from the world's car companies one trend was obvious -- there was no trend.  Or, perhaps more accurately, there were several trends, some running in parallel but others clearly contradictory to one another.  If one were to take a clinical view, one might say the auto industry is demonstrating a serious case of schizophrenia.  And that disease, if indeed it is a disease, was never more apparent than at the press conferences that preceded the public opening of the Detroit auto show. 

Why the diagnosis of schizophrenia?  Is the auto industry, beset by competition from within and pressure from without, on the verge of simply blowing its top?  A tour from press conference to press conference might suggest that.  In a generally subdued series of presentations that came on the heels of the announcement of layoffs of 30,000 workers, General Motors made a strong case for its devotion to fuel-saving hybrids and cleaner E85 Flex Fuel vehicles, and then nearly stole the show with its 400-horsepower Chevrolet Camaro concept.  Chrysler group unveiled its own high-horsepower ponycar, the Dodge Challenger, and, at the same time, made news with its economical Dodge Caliber.  Ford extolled the virtues of its Reflex diesel-electric hybrid concept and, in almost the same breath, expounded on the Super Chief truck concept, whose purported ability to run on hydrogen was designed to offset its incredible mass.  Similar schizoid behavior was in evidence from the Japanese, Korean and European manufacturers.  For instance Mercedes-Benz showed off its GL450 seven-passenger SUV and on the next turntable the E320 BLUETEC, designed to sip low-sulfur diesel fuel. Toyota showed its economical Yaris, and the next day its Lexus division introduced the high-horsepower LS 460.

What's going on here?  Are all the car manufacturers nuts? Well, while it might seem like the carmakers are working against themselves, the fact is what they are doing is utterly rational.  Fact is car buyers want high fuel economy; they want power; they want luxury; they want to be kind to the environment; they want popcorn with butter; they want popcorn without butter; or they feel that those who pop corn are being cruel to a living thing.  The point of this is that carmakers are at least as rational as the people who buy their wares, which, I'm afraid, means not much.  And, as they are well aware, the car buying public is not a monolithic mass.  Instead, in the US alone, it consists of some 15 million individuals who have individual needs and desires that might well be in conflict with one another. Hence road rage, bar fights and debates about candidates for "American Idol." 

So, to answer the original question so provocatively posed by this article's headline, the auto industry is not going nuts.  But it is going crazy trying to satisfy all the disparate needs of the world's car buyers.

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