From the Steven Mufson article in the Washington Post, The Car of the Future — but at What Cost?:
Many members of Congress believe they know what the car company of the future should look like.
“A business model based on gas — a gas-guzzling past — is unacceptable,” Sen. Charles E. Schumer (D-N.Y.) said last week. “We need a business model based on cars of the future, and we already know what that future is: the plug-in hybrid electric car.”
But the car company Schumer and other lawmakers envision for the future could turn out to be a money-losing operation, not part of a “sustainable U.S. auto industry” that President-elect Barack Obama and most members of Congress say they want to create.
That’s because car manufacturers still haven’t figured out how to produce hybrid and plug-in vehicles cheaply enough to make money on them….
In his “60 Minutes” interview on Nov. 16, Obama said that before backing a big loan package he wanted to be sure “that we are creating a bridge loan to somewhere as opposed to a bridge loan to nowhere.”
U.S. automakers have spent enough years fighting Washington-D.C.-based policymakers and regulators that they certainly know what they are asking for when they go to Washington asking for money. That they are, nonetheless, going to Washington and asking for money is a troubling sign.
And speaking of opportunities to subsidize the cars of the future, Randall Stross objects to the idea of giving federal money to Tesla Motors, maker of the high-end electric roadster.