Nine months ago, gasoline prices were twice what they are now and the Detroit auto makers were criticized for having too few models that ran on little gas and too many large SUVs with big V-8s. "We'll tell them what to build," was the popular consumer cry.
Since then, the record-high oil prices have collapsed, largely for two reasons. Speculation in commodities had unnaturally buoyed energy prices, and the recession quickly reduced industry and consumer demand.
While vehicle sales are off, reports are that Americans, to some extent, have interrupted their criticism of the auto industry and re-embraced larger SUVs. It is small economical models that are languishing on dealer lots.
That extreme change of events - occurring in less than a year - is an example of why it is so difficult to shape the proper framework for government support for the American-born auto industry.
Current vehicle production is too numerous for the smaller economy that is expected to ensue after decades of living on debt and perceived home value appreciation. That is a given. That auto assembly employee wages and benefits, particularly for health care, have to be reduced is another given. And expect the blurring between what is American-made and what is foreign in a particular vehicle to continue. Model names may be unchanged, but parts, content and corporate ownership will continue to evolve as they have.
On a brighter note, quality across all brands, whether assembled in this country or abroad, is high and will get higher. Each vehicle provides plenty of value for the consumer.
But until international corporate alliances in the auto industry sort themselves out, too much innovation and too many jobs would be lost by letting the Detroit-based manufacturers fail at this time.
Early this week, Americans will hear from the president about what his administration intends to do to move the auto industry ahead and what form it will take. About $17 billion already has been committed to General Motors and Chrysler, and Ford Motor Co., which is leasing back assets sold earlier, does not have the cash to continue to do that much longer.
Some progress has been made by management and labor to reduce costs; expect the White House to continue to apply pressure for further reductions.
Beyond that, we look forward to hearing what the administration proposes. This country must continue to support the innovation and productivity that goes into vehicles and their components, which also can benefit other consumer and industrial needs.