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[GreenYes] SUVs - The light at (which) end of the tunnel
- Subject: [GreenYes] SUVs - The light at (which) end of the tunnel
- From: "Peter Anderson" <email@example.com>
- Date: Wed, 8 Jan 2003 14:30:37 -0600
FYI (Before anyone becomes optimistic, this is precisely the point, when
there is light at the end of the tunnel, that the forces of darkness deflect
the bullet and continue on their merry way with only some slight window
dressing modifications, in the form of a few hybrids w/ only a fraction of
the advertising blitz for the largest SUVS, and the chance for fundamental
shifts that are environmentally necessary are lost as we, once again, snatch
defeat from the jaws of victory. - p)
WALL STREET JOURNAL -- 1/8/03
Detroit Fears Some Consumers
May Be Souring on Big SUVs
By JEFFREY BALL
Staff Reporter of THE WALL STREET JOURNAL
"DETROIT -- An unsettling thought is starting to nag at auto makers who rely
on sport-utility vehicles for a big chunk of their profits: The biggest SUVs
are becoming uncool.
The death of the SUV has been falsely proclaimed off and on throughout its
decadelong rise as an American consumer icon. But now some of the Big
Three's top executives themselves say they see distinct signs that an
important segment of cutting-edge consumers -- not just environmental
activists -- are starting to sour on monster SUVs.
"Sales of SUVs hit a record in 2002. Still, DaimlerChrysler AG's Chrysler
unit is finding in market research that SUV owners themselves are
increasingly unhappy with their vehicles' poor fuel economy. Chrysler,
hoping to play on what it thinks is a growing environmental consciousness in
the average American consumer, is even running a national TV commercial
suggesting that people buy a minivan instead of an SUV because the minivan
goes farther on a gallon of gas.
SUVs increasingly have become the butt of jokes for political satirists and
cartoonists. A group called the Earth Liberation Front has claimed
responsibility for a series of vandalism attacks on SUVs, including a fire
this month at a Pennsylvania car dealership. But what has some Detroit
executives particularly worried are signs of a backlash developing among the
next generation of auto buyers: the "millennials," who are now in their
teens and 20s. "It's a big deal, and it's real," says James Schroer,
Chrysler's executive vice president for sales and marketing.
"A TV ad set to start broadcasting on Sunday proclaims a link between SUVs
"Criticism of big SUVs is clearly getting louder and broader. On Sunday, the
Detroit Project, a coalition headed by newspaper columnist Arianna
Huffington, is scheduled to begin airing 30-second TV ads in New York,
Washington, Los Angeles and Detroit that mimic popular antidrug ads in their
suggestion that SUV buyers are implicitly supporting terrorism. The ads
follow efforts last year by major Christian and Jewish organizations to
persuade their adherents that gas guzzlers are immoral because they use
wasteful amounts of natural resources. In the fall, an evangelical Christian
group started running TV ads in four states with the tagline: "What Would
"The Huffington ads mark the latest effort by SUV critics to tie the
vehicles' high fuel consumption not to environmental concerns such as global
warming, but to U.S. dependence on foreign oil -- an issue meant to grab
public attention as the nation moves toward possible war against Iraq.
"'This is George,' one of the ads says. 'This is the gas that George bought
for his SUV. This is the oil company executive that sold the gas that George
bought for his SUV. These are the countries where the executive bought the
oil, that made the gas that George bought for his SUV. And these are the
terrorists who get money from those countries every time George fills up his
SUV.' The tagline: 'Oil money supports some terrible things. What kind of
mileage does your SUV get?'
"For the most part, the auto industry continues to aggressively market big
SUVs, which in some cases fetch profits topping $10,000 apiece. Chrysler,
for instance, displayed at the annual Detroit Auto Show this week a new
version of its biggest SUV, the Dodge Durango, touting its massive climbing
and towing power. Big pickup trucks are still an industry favorite: Tuesday,
Japan's Nissan Motor Co. unveiled its first full-size pickup -- the Titan --
with a news conference showing the shadow of the truck eclipsing pristine
red-rock canyons. The teaser: 'Get ready for something big. Really big.'
"Consumers, of course, continue to snap up the big rigs. One in four
vehicles sold last year was an SUV, according to Autodata Corp., an industry
research firm. SUV sales overall rose 6% last year, even as the overall auto
market fell 2%. 'Light trucks' -- a category that includes SUVs, pickups and
minivans -- now account for about half of the U.S. market. Plenty of buyers
continue to believe that bigger is better. One of the hottest new SUVs on
the market is General Motors Corp.'s Hummer H2, a military-inspired vehicle
whose aggressive look and massive size is its basic selling point.
Still, despite the popularity of the Hummer and other in-your-face SUVs,
many consumers have been gravitating for the past couple years toward a
kinder, gentler kind of SUV, such as Toyota Motor Corp.'s Lexus RX300 and
Bayerische Motoren Werke AG's BMW X5. These "crossovers" -- introduced by
the Japanese and European auto makers and then copied by the Big Three --
offer smoother rides and better fuel economy, partly because they are built
on the underpinnings of a car, not a truck.
"Now, however, some top U.S. auto officials quietly acknowledge signs that
the leading edge of consumer culture is starting to shift against the
industry's cash cows. The auto industry pays especially close attention to
cultural trends, and some of its leaders say they see signs that Americans
in their teens and 20s are far less likely than their elders to gravitate
toward vehicles that drink a lot of gas.
"One result is the Chrysler TV ad. In it, a brain surgeon in an operating
room about to start the procedure comments that a minivan gets better fuel
economy than an SUV. The patient, lying on the operating table, notes that
he drives an SUV. Hearing that, a nurse looks at the patient as the
anesthetic is about to take hold and says: "Sleepy time."
"Chrysler isn't the only auto maker sensing a cultural change. Ford Chief
Executive Bill Ford said at a dinner with reporters Monday that he has
insisted that his senior executives take seriously what he regards as a
broadening consumer concern about SUVs. He said his company needs to be
prepared to adapt if consumers do shift away from the biggest SUVs, and he
points to Ford's forthcoming hybrid gas-and-electric SUV, the Escape, as an
example of Ford's effort to respond to SUV critics. Next year, Ford plans to
bring out a midsize crossover wagon, the Freestyle, aimed at consumers who
are either tired of traditional SUVs or unwilling to buy a big SUV when
their lifestyles dictate a move out of a sedan.
"GM, meanwhile, confirmed this week that it intends to offer fuel-saving
hybrid gas-electric systems as options on as many as one million vehicles,
including large pickups and SUVs. The question, GM officials say, is whether
consumers will buy the systems.
"Robert Lutz, GM vice chairman and product-development chief, was one of the
drivers of the push to SUVs in the 1990s when he worked at Ford and then at
Chrysler. He says GM sees no sign of a backlash against SUVs now. "We're
dealing with fringe elements here whose voices are greatly amplified by a
bemused press," he says. "It's much ado about nothing."
"GM officials say their research shows no evidence younger consumers are
less inclined to buy SUVs because of environmental concerns. "On the
contrary, it's especially the younger buyers who just love stuff like the
H2," Mr. Lutz said. "Kids like the same things we do." In fact, GM officials
said their consumer research indicates a backlash against minivans, with
buyers moving out of that segment to SUVs."
- Gregory L. White and Joseph B. White contributed to this article.
Write to Jeffrey Ball at firstname.lastname@example.org
RECYCLEWORLDS CONSULTING Corp
4513 Vernon Blvd. Suite 15
Madison, WI 53705
Ph: (608) 231-1100
Fax: (608) 233-0011
Cell (608) 438-9062
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