Sunday, May 23, 2004

To Fret or Not to Fret

The Oil Question has many dimensions. One that I am seeking to explore at the moment is this:
"There are other jolts as well. American car companies, for example, have become dependent on the sale of bigger, heavier sport utility vehicles and pickup trucks. Leave aside last year's frenzy over the Hummer H2 S.U.V., which gets about 11 miles to the gallon but has already seen its popularity plunge.

Consider what happened to Detroit's Big Three car companies in the 1970's, when they found themselves blindsided by demand for small cars. In their panic to change course, they introduced several of the worst new cars of all time: the Chevy Vega, the Ford Pinto and the A.M.C. Gremlin.

"The auto industry has a huge problem,'' said Philip K. Verleger Jr., an independent oil analyst based in Newport Beach, Calif. "Detroit is once again going to have to retool with hybrid cars of whatever the market demands.''

I am trying to argue that this is true, but there is no hard real evidence except for this.


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