Archive for June, 2011


June 27th, 2011 Comments off

Last month, Autoblog Green writer Eric Loveday wrote about an interview with Bob Lutz – former Ford/Chrysler/BMW executive, most known for his recently-ended stint at General Motors where he retired as Vice Chairman of Global Product Development.  Now, as a car-guy, I’ve always sort of admired Maximum Bob.  He’s a car-guy as much as a businessman, and he oversaw the development of more than a few worthwhile vehicles in his career.  But, he does have some flaws in his thinking, which are painfully revealed in the Loveday interview…

Bob Lutz

Bob’s a climate-change skeptic, and it shows in his opinions related to CAFE regulations and the federal government’s role in the auto industry.  He says of the initial CAFE rules from the 1970’s,The feds basically handed our market to the Japanese.”  He then describes how the American automakers made perfectly desirable vehicles until CAFE came about, forcing the domestic industry to abruptly redesign and re-engineer everything in order to comply.  And since change is hard, American auto quality suffered.  He also blames the State Department for granting Japan a favorable exchange-rate, making American competitiveness even more difficult.  (I’m no economist, but I’m pretty sure the State Department doesn’t set exchange rates.  Am I wrong?)

Bob describes the U.S. federal government as the only one in the world that is hostile to its own auto industry because of the policies it places “against” the automakers, born of what he calls a complete lack of understanding of what is technologically feasible.  He describes a mandate of 42 mpg by 2025 as physically impossible, tantamount to mandating that all cars have to “hover off the highway by two inches.”  (For what it’s worth, 42 mpg is the below the range of what NHTSA has been considering as the 2025 CAFE rule; instead, the agency has been considering improvements of 3%-6% per year beginning in 2017 within the realm of possibility, equating to 47 mpg to 62 mpg by 2025.  Additionally, today the White House “unofficiallyreleased a proposed CAFE target of 56.2 mpg.  I wonder what Bob thinks about that?  …Actually, I’m pretty sure I already know…)

Bill Ford

In contrast, Bill Ford – Executive Chairman of Ford Motor Company – recently spoke at the TED2011 conference, and penned an opinion piece on, describing the global gridlock we face as the number of cars on the planet doubles or quadruples over the coming decades from the nearly 1 billion vehicles we have now.  Bill accurately describes the downside:  traffic jams, squandered time, stifled economic opportunity, and the resulting loss of mobility options and lower standard of living.  He then suggests a few solutions:  better mass transit systems, smart cars, smart infrastructure, and cooperation among corporations, entrepreneurs, NGOs, universities, and governments.  In stark opposition to Lutz’s tack, Ford anticipates the unsustainability of the current paradigm, and envisions possibilities to overcome the challenge.  (Lutz, on the other hand, only envisions external factors as the cause of difficulty for his industry.)

The contrast between these two auto executives – and their view of the world – couldn’t be more apparent.  It’s a good thing for GM that Lutz is now a former executive.