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Re: Oil hits $114/barrel - No end in sight.
Quote:
Originally Posted by Americano
Without a doubt he has. From what I hear there are a lot of people out there frightened about overall inflation as we're definitely in for some severe economic changes. It's encouraging that in the late '90s US vehicle manufacturers did forecast the end of demand for big SUVs at $4/gallon. Little did they know that demand decline would be so abrupt it would ruin their used vehicle market.
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Yes, the journal did a cross country article on suv sales..
Ford which forecast profitability this year is taking it in the neck, primarily due to suv sales slump...looks like they need their own K car and the smaller ecologically efficient designs are on the drawing board again in earnest ala the early 80's faster than they forecast. This also will be reflected in price point and cost per unit build, which is still 20% higher than your average Honda plant in Tennessee for instance. The fact that the dollar buys less and less and they must negotiate the harsh math of labor costs and requests for lower benefits etc. is one vicious cycle is it not?
If I recall that was one of the major reasons Japan ala Honda etc. got a foothold here...then they ratcheted up quality. Detroit refused to design and market cars with better efficiency and quality control. The rest is history.
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The Road to Serfdom
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