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Thursday, March 26, 2009

Auto bailout: No strings attached?

As Japan moves to cheaper hybrid cars, the Big 3 continue to stick to pie in the sky, expensive EV plans. What's realistic in the short to midterm?Is Obama's task force being realistic?

Earlier this week, the EPA called CO2 a "health danger", setting the impetus to higher national fuel economy standards, probably similar to what California is seeking, in addition to a carbon trading cap-and-trade program. Both programs, many auto analysts have noted, could be detrimental to Big 3 viability.

At the same time, it appears a 9 1/2 million vehicle run rate per year could be around a couple of years - something which US automakers have called unsustainable. 11 1/2 million vehicles per year is closer to the Big 3's threshold.

Yet, here we are at the deadline for more automaker aid, which is coming with few strings. However, if the run rate sticks at 9 to 10 million autos per year, automakers will need more and more help, and that is without higher fuel economy standards or cap-and-trade. Add these programs, and the need for significantly more auto aid will be necessary.

Isn't it time for a more comprehensive conversation regarding these intricately intertwined issues from Washington? Is that too much to chew in a sound bite?

Labels: bailout, cap and trade, fuel economy

posted by Dahcredyns at 6:38 AM

3 Comments:

Anonymous Anonymous said...

just more obamagics. now worries though. obama and congress will just direct the fed to print trillions of extra dollars to fund their new fascist regime.

9:20 AM  
Blogger Dahcredyns said...

Obama addressed this issue today at his town hall meeting without really providing any details for concrete plans for action. It seems he's trying to please everyone in my opinion.

No doubt its a tough spot to be in, but I think I needs to bring several issues together.

http://news.yahoo.com/s/ap/20090326/ap_on_go_pr_wh/obama_autos;_ylt=ArSC5qYIZGh7eKkPthP3E.iL_bIF

10:59 AM  
Blogger Dahcredyns said...

Just saw a report on CNBC that claimed that cap and trade is dead will be making a new post soon.

12:15 PM  

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