From the latest Automotive News:
Ford CEO Mark Fields…said last week: “The good news is as we see that shift into trucks and utilities going forward, that’s a benefit for us because of our profitability on those vehicles.”
The same point applies a hundred fold, of course, when comparing cars in general to the actually sustainable modes of locomotion.
According to Automotive Age, the publicly-restored car corporations are raking it in now:
American consumers are on pace to spend more than $400 billion buying new vehicles this year for the first time ever.
That’s nearly 80 percent more than just five years ago, during the recession, according to J.D. Power and Associates, which does not adjust the numbers for inflation. It’s also more than a decade ago, even though sales volumes are still lower now. Higher transaction prices have more than made up for the shortfall in volume.
The rise in revenue is comfortably outpacing the overall gain in volume as consumers shift toward larger, pricier SUVs and crossovers and away from less-expensive sedans. And the added revenue is lubricating the industry like never before.
At 2004 transaction prices, which were about $4,500 per vehicle less than today, the industry would have needed to sell about 19 million vehicles to achieve the current level of consumer spending.
“The industry is performing at a very, very high level,” said Thomas King, a J.D. Power vice president. “There’s good news on volume, exceptionally good news on transaction prices and therefore record-breaking spending. We broke the record in ’13 and we’re going to break that record again in ’14.”
Atrocious news for the planet and its dominant species, of course…
But what’s that, compared to even more money for the 1%?
Based on Fortune 500 statistics, comparing 2004 to 2011 results:
Change in Sales Revenue: -22%
Change in Number of Employees: -36%
Change in Reported Profits: +328%
Change in Sales Revenue: -21%
Change in Number of Employees: -50%
Change in Reported Profits: +580%
Anybody see a pattern?
So, you’d think, if capitalists really did take their customers’ interests at least partly seriously, that the first generation of “alt fuel” cars would be the least efficient ones.
Ah, but as Henry Ford II once infamously quipped, mini cars mean mini profits.
Hence, Chevrolet is preparing a Volt mini-van.
The next Prius, meanwhile? A station wagon:
According to Automotive News, the Prius wagon uses the standard Prius hybrid engine but “weighs about 220 pounds more” than the sedan, and “increases the [vehicle’s] drag coefficient” by 16 percent.
Peak oil?¬† Petro wars?¬† Climate change?¬† No plausible alternative energy sources?¬† Exploding oil rigs?¬† The human future?
Who needs ’em and what of ’em, when you’re a corporate shareholder?
It’s good times, baby, good times:
Even, kind of:
The automobile is the ultimate corporate capitalist product for a host of reasons. Among these is the fact that the car itself can serve as a Trojan Horse for duping prospects into making profoundly stupid but highly profitable extra purchases.
To wit, this report from Bloomberg Business Week, which elucidates one of the main reasons why Ford is about to post record profits in the middle of Great Depression III:
‚ÄúFord was among the first to recognize that making money is more important than moving the metal,‚ÄĚ Johnson said. ‚ÄúThere‚Äôs now a general level of pricing discipline across Detroit, which is leading to higher average transaction prices.‚ÄĚ
The Fiesta subcompact, which went on sale in the U.S. in June, is fetching $3,000 to $4,000 above its $13,995 base price because buyers are ordering options such as leather seats, Pipas said. The Fiesta is commanding a higher average price than Honda Motor Co.‚Äôs Civic and Toyota Motor Corp.‚Äôs Corolla, Ford said.
Buyers are [also] paying more on average for Ford vehicles as the company introduces new…features such as voice-activated phone and stereo controls.
In other words, Ford finds itself enjoying renewed pricing power because it is using its automobiles as platforms to sell massively marked-up trivialities such as leather seats and (extremely dangerous) electronic toys.
And, in a hilarious note that speaks volumes about the myth that high social standing and academic credentials are signs of underlying intelligence and thriftiness, catch this explanation for it all:
George Pipas, Ford‚Äôs sales analyst, said in an interview. ‚ÄúPeople buying Fords today are generally more educated and affluent and they want and are willing to pay for nicer Fords.‚ÄĚ