Driven by the rise of the millennial generation and a global growth boom, the auto industry is in the midst of a new golden age, said Mark Fields, Ford Motor Co. COO, in a speech at the Automotive News World Congress. The industry should take advantage of that to lure new talent, he said. Fields called it “the most exciting time for the auto industry in the last 25 years.”
Growth of small cars and luxury sales are pushing industry growth from different ends.
“There are 2.1 billion people reaching driving age in countries where the number of middle-income consumers is growing. These countries have huge potential for growth of first time buyers,” he said.
“Today the luxury segment accounts for 8 percent of the total global market,” he said. “Globally, the luxury market is forecast to add approximately 2.3 million vehicles in the next five years — with lots of opportunity in markets like China, the U.S., Russia, Turkey and Brazil.”
An exciting golden age, indeed! Is this how Thelma and Louise felt in their last 30 seconds?
[Source: Automotive News, January 14, 2014]
Readers of DbC know that cars exist to sell people far more transportation equipment than they need, and that adding mark-uppable geegaws to cars has always been a core part of this indispensable corporate capitalist endeavor. DbC has also been reporting on how onboard electronics is the next great frontier in this push, and how it is making cars-first transportation even more unsafe for its supposed primary beneficiaries.
Last week in Novi, Michigan, the relevant powers that be assembled for the Telematics Detroit 2013 conference.
According to Automotive News, the show included a panel discussion in which four experts admitted that the ballyhooed arrival of the “driverless” car is exceeding unlikely, due to the inherent expense and complexity of this Rube Goldberg-squared idea.
Noteworthy in Automotive News‘ report are two quotations from the experts on this panel.
The first is a piece of unintended comedy from Andreas Mai, director for Cisco System’s automotive unit in North America:
“I would actually pay for being able to drive to Chicago in the middle of the night at 200 mph,” Mai joked.
Gosh, Herr Mai, wouldn’t that be routine, if we’d built railroads, rather than letting our capitalists dictate cars-first transportation?
The second remark is simply back-room Mafia-talk from Heri Rakouth, director of technology exploration at Delphi Corporation:
“For me, safety is the business of the government,” Rakouth said.
That’s from the mouth of somebody whose occupation is pushing “Internet connectivity and infotainment aspects” into cars. That, of course, is the practical equivalent of shoving open whiskey bottles into drivers’ laps.
University of Illinois outcomes modeler Sheldon Jacobson estimates the dimensions of two of the ways in which cars-first living pumps up allied industries by generating the obesity epidemic in the United States:
After analyzing data from national statistics measured between 1985 and 2007, Jacobson discovered vehicle use correlated “in the 99-percent range” with national annual obesity rates.
“If we drive more, we become heavier as a nation, and the cumulative lack of activity may eventually lead to, at the aggregate level, obesity,” he said. “When you are sitting in a car, you are doing nothing, so your body is burning the least amount of energy possible, And if you are eating food in your car, it becomes even worse.”
Ultimately, Jacobson said, we are going to have to rethink the way we use our automobiles if we want to address obesity.
“We have had 60-plus years of infrastructure that has facilitated the obesity epidemic,” he said. [Source]
The resulting boon to the medical-industrial complex? A twenty to fifty percent increase in per capita medical spending among obese people, according to Reuters.
The boost to the much over-blamed oil industry?
Some costs of obesity reflect basic physics. It requires twice as much energy to move 250 pounds than 125 pounds. As a result, a vehicle burns more gasoline carrying heavier passengers than lighter ones.
“Growing obesity rates increase fuel consumption,” said engineer Sheldon Jacobson of the University of Illinois. How much? An additional 938 million gallons of gasoline each year due to overweight and obesity in the United States, or 0.8 percent, he calculated. That’s $4 billion extra.
Is this self-reinforcing cycle vicious or virtuous? Depends on whether or not you’re a capitalist, doesn’t it?
On September 9, the bony Señor McKibben graced the stage of the Commonwealth Club of California, at an event dedicated to explaining how McKibben and co-star Paul Hawken “advocate a cleaner and healthier form of capitalism.”
McKibben’s diagnosis of our main problem?
“Our problem is far and away caused by the fact that the fossil fuel industry, which is the most profitable industry on Earth, has all of the financial means at their disposal to keep us from taking action….It’s people versus very concentrated pockets of money.”
Such quixotic superficiality is music to the ears of yuppie pseudo-radicals and capitalists alike. Its repetition signals that cars and capitalism are still safe from scrutiny, despite the accumulating facts of the matter. Fake activists can continue to buy Priuses and strike poses, while business as usual rolls along, unmentioned and unthreatened.
“Capitalist production begets, with the inexorability of a law of nature, its own negation.” It is supposed to be crude and wrong to say such things.
Meanwhile, consider this bit of insider planning:
Some media experts have predicted 20%-30% increases for this year’s TV upfront market, in which media buyers will strike deals for commercial time in the fall season, based on early reports of economic recovery. Several key economic indicators are up since last year — durable goods; real retail and food service sales; vehicle sales; and consumer spending — leading to a feeling of optimism among network executives. But a lurking factor could spoil the party: rising gas prices.
The average price of regular unleaded gas has hit $3.68. That’s still shy of the $4.24 high set in June 2008. But what happens if the summer driving season and the unrest in the Middle East pushes gas prices above the summer 2008 levels, above even $5 per gallon? According to Nielsen Wire, a 50-cent increase in gas prices would cost the typical U.S. household about $52.50 per month, and if prices were to rise two dollars, that would mean $210 a month, or more than $2,500 a year. In an economy where job and personal income growth is meager at best, the economic and psychological impact of paying $2,500 more a year for gas can have a profound impact on consumer spending.
A jump in fuel prices also eventually translates to higher transportation costs for marketers, which pass those costs to consumers through increased prices for everything they buy — not just gas. As prices rise and inflation ensues, the Federal Reserve could be forced to raise interest rates, which would hurt the still floundering housing market.
At times like these, retailers need to protect their brick-and-mortar businesses. When shoppers go online, there is clearly less foot traffic in traditional stores. Rising shipping costs also eat into the retail profit structure. Either way, retailers are squeezed.
Heading into the upfronts, then, smart marketers and media buyers should consider whether the hike in gas prices will be short-lived or whether it will trigger a longer economic downturn that alters consumer behavior and shopping patterns.
This is from Hank Cohen, CEO of KSL Media, the independent media planning and buying agency, via Advertising Age.
This is not going to be a passing problem, either. Capitalists are institutionally addicted to cars-first transportation. Cars-first transportation in the United States obliges huge use of petroleum. Peak oil ensures that huge use of petroleum will be an increasing choke on the possibility of economic growth. Catch-22.
Meanwhile, thanks to the premium on keeping the capitalist addiction out of sight, the topic remains undiscussed and undiscussable in mainstream venues.
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