Greenthoughts 18
Almost Heaven
I have Thanksgiving week off and I headed back to West Virginia on Sunday. It’s Tuesday morning and I’m watching the Today show. I’m getting caught up on Britney Spears’ big comeback and just watched a shrimp running on a treadmill and a dog playing golf.
This is a very relaxing week for me. West Virginia plays Pitt on Friday; we’ll see if we get a bowl game. Hopefully a nice end to a slow week.
I’m starting to make my way through “Hot, Flat and Crowded” by New York Times columnist Thomas Friedman.
It’s a good book and I like how Friedman writes. Interestingly, he talks early on about how soiled our government has left the big three domestic automakers. They allow some vehicles to be classified as light trucks to escape more stringent mileage standards. This is one factor in our energy efficiency complacency.
Denmark received 99 percent of its energy from the Middle East in the early 1970s, he writes, but the country became a big progenitor of alternative energy and now gets none of their oil from them.
Friedman says that premium gasoline in Denmark is $9 a gallon. It might be easier for the United States to fall back into our old habits with gasoline priced at $1.59, the lowest I’ve seen for a gallon of unleaded in quite awhile.
If we’re serious about energy independence, we may need to consider carbon taxes and carbon tariffs. Denmark has a carbon tax. I wonder if Denmark has more agility to operate, kind of like a small business in its decision making, because of its smaller population.
Is this a harder task for us because we are a nation of 300 million making us more like a corporation? Or is this just an excuse?
The Heartbeat of America
Friedman also points out in the book that when he’d asked General Motors chairman and CEO Rick Wagoner why they didn’t make more fuel efficient cars, he said, “We build what the market wants.”
The market can turn on a dime (and has). In capitalist countries, some companies survive a downturn and some don’t; that’s the rule. It was smart business in a hot economy to begin developing more fuel efficient vehicles. GM might be an easier sell for a bailout had it developed more fuel efficient vehicles to compete with the Honda Accord, the Toyota Prius or the Camry hybrids, cars that competed better when gas prices were high.
In a recession, you cut your expenses, lower inventories, or you go out of business. And now, General Motors is faced with bankruptcy. We can’t forget that the big reason why is because they haven’t made competitive fuel efficient cars and that their credit has dried up.
They have only the government to turn to, a government already burdened with recapitalizing the nation’s banks. What an inopportune time.
The story on Monday’s front page of “The Winchester Star,” the paper my parents take out of Winchester, Va., talks about how a local Dodge dealership chain, Clarke Motors, is going out of business. The dealership depended to a large extent on sales of pickup trucks to the burgeoning home construction market. When new home construction dwindled so did their sales. Clarke Motors is selling to a local Volvo dealer. Bankruptcy rumors for other dealerships in the area are rising.
We’re told that if GM files, then it will also be the end of all these dealerships. And the company isn’t even considering bankruptcy as an option, possibly delaying a process they should be preparing for, unless they considered themselves not under the same set of rules that the rest of the economy operates under.
And I don’t think they realize it.
It’ll take much more than the top executives of these companies to stop traveling by private jet to impress me. They need a culture change at their companies, and I wouldn’t bank the future of the company on a car that gets 40 miles out of an electric charge: the Chevy Volt.
None of the major U.S. auto manufacturers have proposed anything extraordinary, something that can carry us into a more energy independent future. I’m not sure we need the biggest visionary at the top, but we need some visionaries in there.
The companies also rank at the bottom for fuel economy among domestic passenger cars, below Honda, Nissan and Toyota. Those companies can build cars in the United States.
See: http://www.cars.com/go/advice/Story.jsp?section=fuel&story=cafe&subject=fuelList
General Motors was too energy dependent on low gas prices to sell big vehicles. Now they’re dependent on incentives like employee pricing to give away cars.
I believe there are enough GMC trucks, Chevy’s and Lincolns out on the road to keep a market supplying those vehicles with parts. They need to reorganize if they want to stay in business and figure out how Honda and Toyota operate car manufacturing operations in the United States.
Either that, or this plan they’re delivering to Congress on Dec. 2 must show that they have a clear plan for creating more energy efficient vehicles.
Sustainability Summit
On a final note, the American Home Furnishings Alliance held its Sustainability Summit at the Proximity Hotel in Greensboro, N.C. earlier this month. This event left me feeling revitalized in regards to sustainability issues.
I’ll have a few stories on the web and in the magazine about event. I hope that the AHFA continues this summit for years, because it really engages attendees and the Proximity, the only LEED certified platinum hotel in the nation, was the perfect place for it. It’s a very forward looking event for the furniture industry.
I’d begun getting scared that people would forget about sustainability with this economic crisis. I think what happened over the last few years, as gas skyrocketed, at first during Hurricane Katrina and then through the dwindling years of the Bush presidency, we reached a tipping point and that green issues are now ingrained in our consciousness.
Where we go from here? Who knows. But we’ve got a president-elect who promised to cut energy dependence on the Middle East. It should be interesting.
For GM, the first thing they have to do is stop digging. I’m not sure asking for money to buy more shovels is the way back to prosperity.
Best
Heath
