THE ROAD OUT OF SERFDOM:

Powertrain Powerball In Detroit (Jonathan Fahey 01.09.07, Forbes)

Auto companies have lots of ideas for environmental engine technologies that will save fuel and reduce emissions. They just can't decide on one. Or two. Or three.

Given the massive cost of developing and building engines, this is getting to be an expensive proposition for an industry already besieged by high structural costs. And the enviro-push only seems to be getting more expensive, not less.

Over the course of several interviews with auto manufacturers from Seoul to Stuttgart at the 2007 North American Auto Show, the story was the same: No automaker can predict whether the world wants to save fuel with advanced gasoline engines, clean diesel engines, hybrid electric vehicles, plug-in hybrid vehicles, all-electric vehicles or hydrogen fuel cells.

The key to public policy-making is to force such innovation but not to pick amongst the alternatives. Let the market handle that.

Posted by Orrin Judd at January 9, 2007 7:25 AM