Friday, November 14, 2008

Bailing out the auto makers

If the Fed's bail out the automakers, it will only postpone their inevitable demise unless dramatic action is taken.

The first action should be to kill the Hummer and all its progeny and the second action should be to license innovative technologies like plug-in hybrids and carbon fiber cars, like the Aptera.

What these startup [green] auto companies are lacking is the manufacturing and marketing muscle to bring their products to a wide public. Even in a weakened condition, GM, Ford and Chrysler still have the ability to adopt new technology and place electric or hybrid cars in showrooms across the US and around the world.

This should be part of the bargain if the US government steps in to help the automakers. The large-scale impact of the collapse of the US auto industry may be too horrible to contemplate. But, as Friedman and many others are suggesting, the companies cannot and must not try to keep going as though nothing happened.

The Big Three may not be as nimble as the startups, and change may be wrenching. But one approach that could accelerate innovation would be for the automakers to buy new technology from the startups...

If the federal government is going to sink money into US automakers, it should go to developing future technology, not propping up past failures.
|Innovation can save the auto industry - Guardian|

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