Analysis: Green cars may save Detroit yet

By SHIHOKO GOTO U.S. carmakers are only putting their own futures at risk by not investing more in manufacturing energy-efficient cars, especially when there is increasing demand for vehicles that guzzle less gas even within the United States.

That's the latest finding by the Civil Society Institute, a nonprofit research group.

On the day Chrysler announced it would slash 13,000 jobs, the institute's president, Pam Solo, argued Detroit's Big Three are stuck in the '50s. She said Wednesday Ford and General Motors as well as DaimlerChrysler all need to start producing autos with better gas mileage that are fun to drive and interesting-looking or risk losing even further market share to foreign competition. Instead, U.S. manufacturers have been falling behind their European and Japanese counterparts that are expanding their lines of green cars. According to the institute's 40mpg.org project, which is lobbying for legislative change to make 40 miles per gallon a requisite for cars driving on U.S. roads, there are 113 models outside of the United States that drive an average of 40 mpg, but only two of them are actually available in the U.S. market. Another point of concern is that the two that are available in the United States -- the Toyota Prius and Honda Civic Hybrid -- are both made by Japanese manufacturers.

That's not to say, however, that U.S. manufacturers do not have the know-how to build more efficient cars, given that a number of the more environmentally friendly vehicles available in the European and Japanese markets are actually made by the Detroit companies. Moreover, 40mpg.org's spokeswoman Ailis Aaron Wolf argued that U.S. consumers are as hungry for more energy-efficient cars as consumers elsewhere.

There's a potential market of at least 2.5 million in the United States so any argument by auto manufacturers that there is not as strong a demand for efficient cars domestically as there is abroad simply does not stand, Wolf said. Furthermore, she said more people were calling for legislative change to push the mpg requirement up to 40 miles as soon as possible from the current level of 22 miles and 27 miles for trucks and cars respectively, instead of targeting the start date to 2017 or even beyond. Certainly, energy efficiency is something more drivers want as most expect gas prices to continue trending upwards in coming years, said Opinion Research Corp.'s senior research associate Graham Hueber, who worked together with the 40mpg.org's study.

Yet even as consumer groups advocate for more energy-efficient cars, U.S. car manufacturers have actually withdrawn some of their more environmentally friendly products. Indeed, in 2005, there were five cars that drove an average of 40 mpg. Over the past two years, however, Volkswagen withdrew its clean diesel versions of the Beetle and Golf, while Honda pulled its hybrid Insight off the market, thus seemingly contradicting 40mpg.org's latest findings.

Therein lies one major hurdle for energy-efficient cars, namely diesel-powered vehicles. While the ultra-clean diesel fuel is being hailed by many legislators and environmentalists alike as an efficient source of energy for cars, retailers are still finding that customers shy away from diesel-powered vehicles as they remember the noisy, black smoke-shooting cars of the past.

Nevertheless, assuming that gas prices will continue to rise in the long run, public demand for more energy-efficient cars is only likely to increase, and it would make sense for car makers to plan accordingly, Wolf said. (Comments to energy@upi.com)

WASHINGTON, Feb. 14

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