Federal government continues to hand over money to automakers

"DCCARGEEK" (dccargeek) 09/10/2013 at 22:18 • Filed to: Government, Funding, DOE

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That is a screenshot from a $45 million dollar grant that DOE announced last week to make vehicles lighter, better and/or more-fuel-efficient. While I believe it is important to invest in R&D and that the government has a role in this, which is mainly to get out of the way from a regulatory perspective, seeing DOE just give money to automakers angers me.

Automakers are coming off the "BEST MONTH IN CARS SALES SINCE WE STARTED SELLING CARS" yet the government feels it's in a position to hand over money to automakers? Because, government is flush with cash...*rolls eyes*

I don't want this to turn into a bailout debate, but am I the only one that feels a little salty to see announcements like the one above come on the same day automakers are out flaunting billions in projected profits to their shareholders?

Link to DOE projects: !!!error: Indecipherable SUB-paragraph formatting!!!

Josh Welton > DCCARGEEK 09/10/2013 at 22:28

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I can see both sides of this.

But the government is mandating MPG regs that are getting harder to match. And the auto industry is so cyclical, one good month/year isn't really saying much long term(financially).

Everyone wanted to talk shit about the Detroit Three when the Prius was way ahead of anything green they had in the works, ignoring the fact that Toyota had spent their government's money to develop it. If you want your manufacturing base to compete globally, you need to play by the global economy's rules.

DCCARGEEK > Josh Welton 09/10/2013 at 22:37

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Ford and Nissan got big loans from DOE via ATVM and I suspect we'll see more of this going forward, but at what point is innovation just a normal part of doing business?

Should we distinguish between a loan vs. grant?

And the Prius, regardless of who paid for what, has built up a brand and fuel economy story that the Big Three, even after receiving plenty of government support, can't come close to competing against.

Josh Welton > DCCARGEEK 09/10/2013 at 22:49

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It should be a normal part of doing business now. But like I said, do you want any chance to compete globally? The Germans are giving their manufacturers money. I already mentioned the Japanese.

You can't expect to jump 20 or 30 mpg in 10 years(I don't know the exact numbers, but I know it's a giant leap) on "normal" R&D. People don't WANT THOSE CARS. If you're going to force automakers to build cars people don't want, then you need to give them an incentive.

DCCARGEEK > Josh Welton 09/10/2013 at 22:54

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What if gas continues to increase in costs fueled by BRIC nation demands & there was no CAFE? The Big 3 would have a bunch of RWD V8 sedans and pickup trucks sitting on lots while everyone rushed out to buy a 60 MPG Japanese and/or Korean compact.

I agree that CAFE isn't perfect, but we need to remember that gasoline is a global commodity and we've (American automakers) been caught with our pants down a few times when oil decides to spike.

Josh Welton > DCCARGEEK 09/10/2013 at 23:00

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"When gas hits $2.00/g I'm only riding my bike to work!"

"When gas hits $3.00/g I'm never driving again!"

"Can't believe gas costs $3.50/g, I've had it!"

-EVERYONE, EVERYTIME.

AND FORD CAN'T BUILD ENOUGH RAPTORS TO SELL.

DCCARGEEK > Josh Welton 09/10/2013 at 23:11

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Good point.

MBG141 > DCCARGEEK 09/11/2013 at 01:21

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I live near Oak Ridge, TN, and I have to say that the ORNL labs needs something else to research other than radioactive stuff. Other stuff such as: "How to stop the town of Oak Ridge, TN from glowing of WWII-era radiation late at night?"

bourgeoisie > DCCARGEEK 09/11/2013 at 10:54

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Your anger/annoyance would be better directed at the lack of public elections in our country.

Politicians (even the "good" ones) have to be elected, and to be elected you need money.

The same system ensures that when the government doesn't something forward-thinking like increasing CAFE standards, automakers have lobbyists who will negotiate for something in exchange. "We'll meet your CAFE standards, but we're going to need help with ____", which is how these grants come about.

Government "spending" is always a red herring, because for each person, there are things we believe gov should spend on, and things we beleive gov shouldn't spend on.

Many of us can agree that the larger issue is why gov is spending the money. If it needs to be spent for the betterment of America, that's one thing, but if it's being spent as a result of lobbyist influence, or election favors, that's the problem.

DCCARGEEK > bourgeoisie 09/11/2013 at 11:07

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Lobbyist influence is a great point. As a former congressional staffer, I'm less sold on the idea of lobbyists having influence over each member and instead would argue that their worth is in their relationship with committee and White House staff. Running for office does require money, but I know many members who vote out of fear of losing party support, rather than losing a $5,000 donation from some PAC. You kiss the ring of your party and when you can, you waive to your lobbyist.

bourgeoisie > DCCARGEEK 09/11/2013 at 12:58

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Most of which, boils down to money, money, money. We can't fix everything by taking the money out of politics, but it really is the answer to a lot of the actual issues of governance (versus politicking).