Toyota N.A. CEO Jim Lentz asks, “Who’s going to spend $85,000 for a pickup truck?”


#1

The clock is ticking and the government mandated 2025 fuel efficiency standards are looming. This car company thinks it’s doable, but at what cost?
I found this article in The Detroit News, by Kaitlyn Buss to be interesting.

Did the experts just choose a figure they liked or was careful consideration given to CAFE standards of 54.5 mpg?
Will car manufacturers be able to pull this off by the deadline?
Has the government gone too far on this?
Is this what American citizens want?
Will the Feds have to back down?

Care to read the short article and join in with your thoughts?


CSA


#2

IMHO the feds are going to drive the standards so high as to make new vehicles unobtainable for all but the most financially robust. That means that numerous people who would like to buy a new vehicle will keep driving their old beaters, spewing more unwanted elements into the atmosphere than if the standards were more realistic. The standards will, in essence, be counterproductive. I would not be surprised to also see an adverse effect on the industries market segment as well.

But I don’t believe the federal regulatory agencies are even aware of secondary and tertiary impacts of their regulations. IMHO they just forge blindly ahead.

One man’s opinion only. Agree or not as you wish.


#3

To say…gee it can’t be done…it’s impossible…let’s give up now…Those engineers that worked for me with that attitude…are no longer working for me. Every time we think we’ve come to the end of a certain technology…then someone comes along and does something different. Time will tell.

I for one am NOT a defeatist. 30mpg while cutting emissions in half was considered IMPOSSIBLE by the auto industry 30+ years ago. Not only are we meeting that figure…we’ve have vehicles getting 60mpg and 1/10 the emissions.

As for the $85k pickup…That’s just a number taken out of thin air…no way to even guess how much it will cost.


#4

I’m not so sure I agree, Mike. Toyota has a great deal of experience in the costs involved with developing and manufacturing high mileage vehicles, and it wouldn’t surprise me at all to find out they already have hard data on this.


#5

The issue is a complicated one to understand given all the bizarro-world language used in the regulations. The model “footprint” used in the calculations drives bigger vehicles because a bigger footprint gets a less stringent MPG requirement (so forget that new Ford Ranger!). Hybrids and E85 vehicles no longer give big advantages to the fleet numbers. The last president signed into law higher CAFE standards only to be trumped by even higher numbers by the current president.

All this is complicated by OPEC’s rush to pump oil like its going out of style to hurt the US’s own shale oil and tar sands exploration. $30 a BBL will not support the shale oil in North America. That takes $46 or so and higher.

Its also complicated by the fact that this will raise the price of cars and trucks by a significant amount thus lowering vehicle sales. That pesky price-demand curve. Lower vehicle sales will hurt the economy and raise the cost of living.

The bottom line; The CAFE standards can’t be met without greatly increasing the price of vehicles. Regulation by academics not borne out in the real world.

You can have 1) Game changing technology and 2) Have it real fast and 3) Have it cheap; Pick Two.


#6

I’m NOT saying it can be done…all I’m saying is we don’t know until we try. History has proven Auto manufacturers have been extremely reluctant to make even the slightest changes…especially if they don’t see immediate monetary gain. I agree Toyota is ahead of the pack…but we won’t know how far we can go until we actually try. To not try is failure.

Quote from GM’’'

said Greg Martin, General Motors’ executive director for communications. “We expect the rules to be tough, but we have a strong history of innovation, and we’ll do our best to meet them.”

I’m also not convinced that the EPA is doing this in a Vacuum. They’ve ALWAYS worked with industry leaders in the past…and scientific advisers from the industry.


#7

I saw a new Ford F-150. The sticker was North of $60,000. Wow!


#8

Automaker may be forced into not selling truck and SUV if they can’t meet the standards. This could lead to large layoffs for manufacturers and perhaps cottage industries rebuilding old trucks.
Wouldn’t VW have been better off if they said "No. we just can’t sell diesels in the US ?


#9

My opinion: One thing that would help is a large increase in the gasoline tax, up to about the level it is in Europe. This would give buyers incentives to buy smaller (and more economical) autos.

There is no reason for autos to have engines with hundreds of HP, with various superchargers on top of that, when all it’s used for is driving on city streets and on highways at no more than 70 MPH. 0-60 times in the 20 second range are fine.

Someone compared two models of car between England and US, and the smallest engine available for the US model was larger than the largest offered in the UK. This indicates why European MPG numbers are better than US.


#10

If you like your truck, you can keep your truck.


#11

When do the Rolls-Royces and Bentleys and Aston Martins find their way to the “We Tote the Note” used far lots in England?

There seems to be a great deal too much economic support being given to the automobile industry. And forget TARP. We continue to have an industry being nursed and coddled into a faux appearance of grand success. Without the “free money” from the Fed it is doubtful that the Big 3 would have any $40,000 cars and trucks on their car lots… Anyone who wants to speak comdemningly of entitlements probably wants to run out of time before getting around to automobiles and automobile financing.


#12

Yeah, Bill, it might create incentives for those buying big SUVs or powerful muscle cars just to show they can to buy more reasonable vehicles, but it would drive those of us on fixed incomes… and those on the lower socioeconomic tiers… into stark poverty. I’d have to start stealing my ramen noodles. :smile:


#13

@MikeInNH That statement from GM was a refreshing one. In the past whenever safety or environmental regs were proposed there was a knee jerk reaction from the Big Three saying it could not be done. They then hired expensive lawyers to stonewall the legislation.
Having gone through bankruptcy has made them somewhat more humble. They also don’t want to look stupid when Asian manufacturers say it CAN be done.


#14

When regulation crosses with consumer preferences, the consumer will find away around the regulation.

The earliest CAFE standards did not include trucks, so when large cars were downsized, consumers bought trucks and SUV’s of the day. As regulation has increased the price of cars - airbags, ABS, Stability Control, backup cameras - people kept their older, simpler cars longer. The average age of cars on the road is 11 years.

Of course when California mandated that 10% of cars sold in 2003 be zero emission electrics, GM made a stab at a electric with the EV1. Too few people leased them to make it viable. Other manufacturers had similar experiences so California was faced with rescinding the order or having no new cars sold in the state by 2003.


#15

@BillRussell , I’m sorry but being like Europe is not something for which I strive.

In my circle of friends/family/coworkers, the majority who own larger vehicles have a legitimate use or need for such vehicles. They transport youth teams, cargo, their large family and the like; their vehicle is not a status symbol, but a tool. In theory, saving energy has many benefits, but in practice I wonder at what point the costs outweigh the benefits.


#16

Trucks can get better ,but , unfortunately the price will not ,I cannot even afford a decent used one now .The cowboy economy has its allure ,when we start acting like we are living on the spaceship called Earth , perhaps cooler heads and sensibility will prevail . The Earth is big ,but a lot of the choice parts have already been grabbed .


#17

Mahindra has a diesel pickup that sells for less than $10,000 and gets 30+ mpg. I guess the Third World is on its way up to catch US on the way down @kmccune.


#18

The Obama administration wants to encourage alternative fuel vehicles. They ensure wholesale availability of electric vehicles by setting the CAFE level as high as they did. ICE fuel economy will also improve along the way. Look how far we’ve come from the 1970s when pollution control first started and fuel economy first became an issue. I don’t know that any of the manufacturers will actually attain the currently mandated CAFE limits, but it is too early to throw in the towel.


#19

I can’t speak to all the interesting issues discussed here, but as far as “who’s going a buy a truck for $85k”, I do know the answer to that question. Not me. I’ll drive my current truck using the starter motor and the battery as the only power source like that Morris Minor on the recent puzzler before I’ll pay $85 k for a truck.


#20

Oh, I think the manufacturers will meet the standards. It’s just a matter of at what cost and whether these standards will have the intended impact.