Our taxes at work

http://www.nytimes.com/2008/11/06/opinion/06thu2.html?_r=1&ref=opinion&pagewanted=print&oref=slogin

November 6, 2008
Editorial
Fill ’Er Up

We fear that a $1.50 drop in gas prices was all it took to blunt Detroit’s newfound fervor for energy efficiency.

Just a few weeks ago, the Big Three American automakers convinced Congress to give them $25 billion in cheap loans to retool their plants to make fuel-efficient cars. Then, with nary a blush, the Ford Motor Company introduced the new star in its line: the 2009, 3-ton, 16-miles-per-gallon, F-150 pickup.

The company has spent about $150 million to retool its Dearborn, Mich., plant to make the new truck, and it plans to restore the third shift at the plant in January to meet demand, adding about 1,000 jobs. As for that commitment to fuel economy? The new trucks should be 8 percent more fuel efficient than the 2008 models, on average — which means that they still use about 50 percent more gas per mile than, say, a Honda Accord.

Ford and other automakers are desperate to find any way they can to dig out of their deep economic pit. And old habits die hard. Ford’s sales collapsed 30 percent in October — a third of its weak sales were F-150s. Chrysler saw October sales tumble 35 percent. Sales at General Motors plummeted 45 percent.

But even if the F-150 gives Ford a temporary bounce, it is not a long-term solution in a world where energy prices will inevitably rise again. Detroit’s automakers must devote their energies and investment dollars to developing the fuel-efficient vehicles of the future rather than tweaking the gas hogs of the past.

Americans seem to get it. As gasoline soared past $4 a gallon in the summer, consumers fell out of love with trucks and sport-utility vehicles. The auto companies that only a few years before had considered switching to 100 percent truck production were suddenly talking about a complete change in strategy.

G.M. sought a buyer for its Hummer line. Ford postponed sending the 2009 F-150s to dealers while it larded on financial incentives to move thousands of 2008’s off the lots. The future, they seemed to agree, would require vehicles that sipped, not guzzled.

This is still true. Gas prices are falling now because the world is tipping into what may be the deepest recession since the 1930s. At some point that will end.

Detroit’s problems will not, unless the automakers understand that the days of cheap energy are over. The Big Three made the wrong bet in the 1990s when they decided to put all their eggs in the truck basket — ceding virtually the entire car market to their Asian rivals.

They evidently haven’t learned enough from their mistakes. Perhaps Congress, from which the automakers are lobbying for more taxpayer money, can help correct their ways — at the very least — by attaching strict fuel-economy requirements to any future aid.