Sunday, November 30, 2008

How to Save the Auto Industry

November 30, 2008

Here they come again – corporations chanting their familiar mantra of economic blackmail. After decades of irresponsible, stupid and sometimes criminal behaviour, the North American auto companies are beseeching taxpayers to rescue them. If we don't open the financial faucet, plants will close, jobs will vanish, the sky will fall. Give generously! Give now!

Why? This has always been a rogue industry, especially General Motors. In 1949, GM, Standard Oil of California and Firestone were convicted of criminal conspiracy for buying and dismantling numerous inner-city electric rail systems, forcing commuters into automobiles and busses. From 1923 to 1986, a consortium that included GM conspired to market a toxic and unnecessary gasoline additive called tetraethyl lead, on which GM held the patent. By 1986, the US Environmental Protection Agency estimated that 5000 Americans were dying every year of heart disease due to the effects of lead.

By then the oil shocks of the 1970s had revealed that the era of cheap oil was ending, and anyone with the intelligence of a squirrel was taking action to hedge against the next oil shock. People insulated their houses, installed alternate sources of heat, took the bus and turned down the lights. Denmark closed its roads on Sundays, and then reinvented itself as the world capital of wind power. The Japanese created magnificent small cars. And the US government instituted a measure called CAFE, the Corporate Average Fuel Economy standard, designed to cut exhaust emissions while doubling fuel efficiency.

Detroit's reaction? GM built a fleet of 1100 fully-functional electric cars in the 1990s – but it then recalled and destroyed them. It abandoned the small-car market to the import brands. Instead, noting the relatively lenient CAFE standards for light trucks, the Big Three concentrated on building poorly-engineered, highly-profitable “sport-utility vehicles,” obese gas-swilling cars that could qualify as trucks.

Then the oil price zoomed. The demand for big dumb vehicles crashed. And now these leering boobies want us to save them from the predictable consequences of their own folly.

Sure, boys. But on our terms, not yours. In truth, this is a magnificent opportunity.

The Canadian and US governments should buy a big slice of these companies – but require that they leap-frog the international competition by radically redesigning the automobile. We can serve the industry, the consumer and the environment at once by transforming the automobile into a totally-recyclable “product-of-service.”


A product-of-service is an alternative to the illusion of “ownership.” We are all transients on the planet; in truth, we own nothing. What we really buy are services, not products – not an automobile, for instance, but the convenient mobility that an automobile provides.

But one can use a car without owning it. We can just lease our cars directly from the manufacturers – but with a requirement that they take the car back at the end of its useful life and recycle every part of it. And the lease could include all the costs of the car.

Think how different the car would be, if the manufacturer was fully responsible for it, and knew it would eventually be coming back. Cars would be assembled with a view to being disassembled. The manufacturers would strive to make durable vehicles, with components that could easily be recycled or re-used. They would become fanatical about servicing cars and cutting their costs of operation – including the costs of their emissions. Consumers would never be ambushed by unexpected repairs. Insurance coverage could be tied to mileage. It would all be in the lease.

With its gluttonous appetite for resources and its toxic wastes, the automobile is the very emblem of our false relationship with the planet – but it could become the first major example of economic sanity and environmental sustainability. This is a unique opportunity. The auto industry is on life support. It's in no position to bargain. Public investment could keep all those employees at work and ensure the survival of the industry – but in return, the industry should be required to devote itself, for once, to the well-being of workers, consumers, and the planet.

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