It’s like this (yes, that phrase is a new crutch of mine): The big three auto makers are screwed. People have no money, nor can they borrow, to buy cars, and Detroit hasn’t been a decent car, much to the delight of the Japanese, since [insert your last favorite American-made car here—the Model T, maybe?]. They focused on making gas guzzling SUVs and trucks, what with their higher profit margins, because, at the time, gas was cheap. And while gas prices have dropped dramiatically in recent weeks, it’s seen as a temporary drop; if you think demand is going to drop in the years to come, especially with the emerging markets of China and India finally getting bitten by the car bug, you’re mistaken.
Combine the cars-ain’t-selling situation with the broader “we’ll all be on bread lines soon” economy and you can see what a perilous position Detroit is in. The question then becomes, do you bail them out or not? If you don’t you risk putting the millions of employees out on the street, and millions of angry, unemployed workers roaming around Michigan (and everywhere Detroit has a presence) doesn’t do anybody any good. If you do you’re seen as “rewarding” Detroit for its bad habits, that is, producing piece-of-garbage cars that nobody wants to buy.
Which brings us to the main topic, the fate of electric cars. By many accounts, Chevy has essentially gambled its future on the Volt being a success. But, if the company doesn’t get any of that sweet, sweet bailout money—it’s not like Detroit is asking for more money, but merely a percentage of the already set aside $700 billion—the Volt may have to go, or at the very least be delayed. Chevy (and co.) can’t continue to develop new automotive technologies if there’s no money to pay the bills.
Now, some “green” activists are suggesting that, sure, give them the money, but force them to do away with SUVs and other gas guzzlers and invest a good deal of that money into hybrids, batteries, electricity and other alternative energies. Make Detroit change its behavior, the behavior that got it into this mess in the first place.