If Detroit automaker CEOs doubt attaining a 35 mpg average by 2020, why are they worth saving?
What happens if Detroit fails is known and feared, but what is the cost of Detroit not failing? The dominance of Detroit is similar to stories such as AIG and Bear Stearns: companies that are too big to fail stifle innovation - and we all pay.
So why should you the American taxpayer take on bailout debt only to ensure a future energy debt? Why not have a 100 mpg Hypercar instead?
The greatest cost of Detroit type bailouts is the cost of innovative small businesses being disadvantaged by artificial support of larger companies.
In 2003, the Rocky Mountain Institute's 'Hypercar' project brought together top composite material engineers and created a new process for the mass production of carbon fiber vehicles via stamping. The vehicle design based on the process was inspired by the 'hypercar' - a 5 passenger non-hybrid vehicle that was able to average 100 mpg.
Imagine a car door that you are able to pick up with 2 fingers - or an entire chassis weighing 800 pounds. Now imagine the effect of that lightweighting on vehicle safety, performance, and efficiency. Unfortunately, Detroit couldn't.
Unfortunately, the CEOs of Detroit automakers and their 'spreadsheet engineers' are unable to imagine much of anything beyond their compensation packages - certainly not a lightweight chassis or better engines such as diesels. The CEO's recent request to be held to 10% mpg increases by 2020 shows them to be willfully ignorant of progressive engineering - or any real engineering at all.
In discussions with Hypercar engineers regarding their reception in Detroit, they often referred to the idea that automakers were incapable of consistently innovating. In the professional view of these persons (who had experience with the design of the YF-22 and other notable projects before creating the hypercar concept), the Detroit business model relied on engineers being tied to the accountants vision of automaking. Rather than undertaking wild flights of fancy on a regular basis, past investments dictated that 'engineers' create a spreadsheet car. The spreadsheet vehicles were designed by picking part numbers of already produced components from their Tier 3 suppliers and then wrapping them in sheet metal. No wonder vehicles look the same.
While Hypercar was doing real engineering, Detroit was repackaging components to create vehicles like the Ford Expedition. While engineers should have been bringing over successful European diesel engine designs, they were instead told by accountants that dividends had to be paid before investment could take place.
We cannot let a bailout become the greatest success for the Detroit spreadsheet. While the companies must be healthy to operate, they need not use public funds to merely strengthen their balance sheets. Ultimately, good investment will make for a company that benefits private shareholder and the public in equal regard.
To assuage immediate concerns, the bailout program must not simply offer a band-aid but rather re-establish confidence in American industry while balancing the nation's energy future. With that in mind, my proposals are as follows:
- We must not repeat the mistakes of the last 10 years; automakers must be held to clearly defined goals and audited research investment. The government should not attempt to secure a public stake in the company via shareholding, but rather ensure that the public benefit from more energy efficient vehicles on the road. The 35 mpg requirement must be moved up to 2015 and greater emphasis placed on ZEV and ULEV designs with the adoption of California regulations on a national level within 2 years.
- Research and Development (R&D) should be cooperative between the companies and lead to public standardization of such elements as hydrogen tank designs or other components of new technologies. This will allow economies of scale both in design and production. Investment decisions will be made by a board composed of 2/3 engineers by professional qualification with involvement by all automotive companies pledging matching research funds. The government shall be represented by agency representatives (e.g. EPA) and public university post-graduate programs.
- Public funds that are used to underwrite these research efforts must dictate that any progress be in the public domain and available to all American corporations of any size on the same terms. Patent royalties shall be paid to a public body for repayment of the taxpayer investments.
- European diesel designs shall be granted an EPA emissions waiver for a period of 3 years. Importation of foreign brands shall be limited to a 0.5 : 1 ratio with domestic brands.
- An Ansari X-prize program of the sort proposed by Sen. John McCain be created. However, rather than the grand prize being a cash reward, the prize ought to be production of the winning vehicle or technology concept and inclusion into the larger bailout program.
These thoughts are a beginning to a program which emphasizes accountability - and even more so, real engineering. Risks should be taken with public investment dollars when the demand for revolutionary progress dicatates that conventional thinking be tossed out th window.
In closing, I would appreciate receiving a reply but would be even more delighted by a real program that ensures America's energy future as much as Detroit's auto industry.
Update:
For the record, the VW 1L @ 238 mpg will enter production in 2010. If you're looking for a domestic car of more conventional design, do see the 300 mpg EV Aptera
For the cynic that wants a laugh...Popular Mechanic's hypermiling madness
All others...buy a VW jetta diesel 40+ mpg w/ 140 hp and 240 ft/lbs torque.
BTW, I did lift that car door frame with 2 fingers. And I did admire the sleek lines of the full size framed mockup. Hypercar was real in 2003. Unfortunately, the hypercar would have devalued too many car company investments in sheet metal, iron blocks, and 5 speed trannies. Now we're living the non-Hypercar history and we should be thinking about how to not live it again.