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Nissan exec. says people are “increasingly not interested in cars”

Posted by on January 16th, 2008 at 9:19 am

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(Photo © Jonathan Maus)

I didn’t expect to read an uplifting story from the big auto show going on in Detroit this month.

Fortune Magazine editor Alex Taylor spoke with an executive from Nissan who says that worldwide, people are losing interest in cars.

Here’s a snip from the story:

“He notes that consumers in Japan are losing their mojo when it comes to cars. The population is aging, and younger drivers would rather spend their money on new cellphones and Internet access.

‘Japan is increasingly not interested in new cars,’ he says.

…As car ownership becomes more expensive and cities increasingly impose congestion pricing on car usage in center cities, he sees car owners switching to mass transit for their daily commute, and then renting cars for longer trips.

‘The U.S. is headed that way,’ he says. ‘The challenge for us, going forward, is a more interesting offer. Doing a better Sentra or an Altima isn’t going to do it.'”

Read the full article here.

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45 Comments
  • gabrielamadeus January 16, 2008 at 9:43 am

    oh that is awesome. I\’ve been noticing the trend too, but am never sure whether we are so immersed in the culture that we are jaded. (sort of like the liberal portland 2004 election season)

    thank goodness the industry is starting to shake. Maybe now they\’ll start producing more of those green hummers!

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  • dennis January 16, 2008 at 9:44 am

    The promise of an automobile utopia failed to manifest itself. Society is waking up, and realizing that Car Culture is dehumanizing.

    There is not the Passion, that there once was for driving.

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  • Dave January 16, 2008 at 10:06 am

    Most Americans never actually liked cars anyway. If they did, there wouldn\’t be a market for automotive smooth jazz like the Toyota Avalon or the Nissan Sentra. Most just want transportation, and they\’ve been told that means buying a car, so they go get the blandest thing they can find with a Consumer Reports Best Buy sticker on it.

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  • Lenny Anderson January 16, 2008 at 10:13 am

    Curious coming from an company whose vehicles resemble military tanks in size and shape.

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  • Laird January 16, 2008 at 10:21 am

    This is an interesting topic to me. I drive a 13 year old pickup and for years I\’ve been wanting to replace it with something newer that has more features, comforts, etc. However, I noticed over the last three years that I\’m driving my pickup less and less to the extent that last year I rode my bike half as far (~3500 mi) as I drove my truck (~7000 mi). With numbers like that a new car payment plus insurance plus $3/gal. gas just doesn\’t sound that appealing. I\’m probably just going to wait until my pickup causes me so many problems that it has to be replaced and I think this is another aspect of problem that the Nissan Exec is referring to.

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  • Paul S January 16, 2008 at 10:24 am

    I think Lane is mostly referring to developed nations — Europe, Japan, the US. For those countries, he may be right. My experience living in China and traveling in Asia suggests that there\’s no GLOBAL shortage of interest in \”automobile culture.\” China in particular is gung-ho to tear out their ubiquitous tree-lined multi-use boulevards filled with \”third world\” bicycles, scooters, tuktuks and minibuses in favor of eight-lane \”modern\” throughways and flyovers packed margin to margin with $3000 \”luxury\” cars.

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  • David Feldman January 16, 2008 at 10:29 am

    Who says there\’s no good news out there……

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  • Dennis January 16, 2008 at 10:31 am

    I guess what I mean, is that automobiles today don\’t inspire any form of passion. They\’re all plastic, with the same designs. They isolate you from your enviroment too much. The cost of the car, fuel and insurance is more than the passion inspires.

    Besides, when\’s the last time you got to go out on the open road? pretty much all the driving that I do, is in stop and go traffic.

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  • Torfinn January 16, 2008 at 10:39 am

    I still have a car, but I\’m selling it soon.

    As long as I can rent a car, for cheaper than a monthly car payment for 3 times a month(eliminating the actual need and subverting it to comfort) I\’m financially in a better position than I would be buying a car if I\’m comfortable commuting.

    I have no vehicle maintenance concerns, no depreciating investment issues, and very little insurance costs.

    Of course, that\’s assuming I rent a car payments worth a month of vehicle, which I expect to be unlikely. I figure the return on investment to be nearly the same in the long run.

    Now, one problem with actually owning the vehicle is serious mechanical failure, or an insurance issue shorting me the value or remainder owed. In that case, you\’d actually come out on top.

    The nice benefit of renting only when needed is the ability to rent according to your actual needs as well. If I\’m doing something out in the boonies I can rent an SUV. If I\’m simply driving to the mountain to go snowboarding the subaru will do.

    I do know that if the average American consumer gets priced out of the gasoline market, I won\’t be heavily invested in a machine that requires gasoline to be productive though, much the same as everyone around me.

    Which gives me the benefit of financial a security most people haven\’t even bothered considering because they\’re too shortsighted, or in denial of our current energy predicament.

    Either way, as far as I\’m concerned the time is rapidly approaching when being vehicle free will likely be the more intelligent choice for sustainability.

    We\’ll see if cellulosic ethanol, or algeal biodiesel develope, or if the rapid advances in solar can outpace our already stretched energy grid and make motorized transportation more viable and planet friendly, but I\’m not hedging my future on it, I\’ll wait and see. Until then I\’m going to cut my reliance on cars as much as possible personally.

    I know my brother and my wife will both be doing the same.

    Just my 2c on the issue.

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  • SH January 16, 2008 at 10:54 am

    The very reason I\’m on a bike too! It came time to spend money on a new car but I thought, wait a minute I can just buy a bike and have more money for other toys.

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  • bahueh January 16, 2008 at 10:56 am

    sounds like a smart exec. to me..he knows where the business is going in the future and probably realizes current infrastructure can\’t handle what\’s coming its way in population growth is realized.

    I had the hardest time buying a car a few years back..they all looked the same and they all seemed fairly overpriced for what I got. I ended up hopping on the subaru bandwagon…

    owning a car is fine…driving one excessively is not. I still ride more miles/year than I drive and I hope to keep it that way if I can continue to live near work…a choice I hope more people start to adopt.

    car companies don\’t have a choice but to adapt or downsize…

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  • Evan January 16, 2008 at 11:22 am

    Maybe if we had more vehicles to choose from that actually offered some practicality, people would be more interested in cars. Note the prevalence of small hatchbacks and wagons in Europe that offer exceptional fuel economy via turbodiesel engines, and are also fun to drive. I drove a Ford Focus wagon in Italy several years ago, just like the ones we have here, except it had a direct injection turbodiesel. It pulled four people and a full load of luggage with more authority AND better fuel economy (probably in the mid to high 30s averaging 90mph on the autostrada with some driving in downtown Florence) than anything I could buy here today. VW, give me a Tdi microbus, not a crappy Chrysler minivan with VW badges!
    Of course, I\’d still ride my bike most of the time.

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  • Robin January 16, 2008 at 11:41 am

    I read this a couple days ago and it\’s the best thing I\’ve read in weeks. Thank for sharing with more people.

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  • wsbob January 16, 2008 at 11:46 am

    What the auto exec has to say doesn\’t surprise me, though I\’m a little surprised he\’d confide it so publicly. The rest of the auto industry might not want people getting too excited about switching their interest to other means of transportation than cars.

    The marvelous age of the automobile is dead in this country. 50-60 years ago, it was great; open, un-congested roads. You could open up your motor and have a good time. Today, it mostly sucks, except that cars today have better stereos and other entertainment diversions to help you while away your time while your stuck in traffic and noxious auto fumes.

    I\’m worried about what Paul S.(comment #6)says about people in places like China that haven\’t had a lot of cars feeling the same desire to have cars that people in this country had in the last century. It seems a shame for them to scar their country with motor vehicles and it\’s requisite infrastructure the way we have with ours. If the average Chinese citizen could somehow just magically experience a year of sitting in their car every day in the commute to Vancouver from Portland on I-5, their interest in bring on the car era in their country might dim somewhat.

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  • Torfinn January 16, 2008 at 11:46 am

    Nissan isn\’t the only one, here\’s GM\’s take on the oil powered personal transportation future.

    http://www.smh.com.au/news/environment/times-up-for-petrol-cars-says-gm-chief/2008/01/14/1200159363527.html?sssdmh=dm16.297413

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  • Mike January 16, 2008 at 11:55 am

    I think that we have colored the exec\’s comments with our own ideals. Owning and driving a car in Japan or Europe is VERY expensive. Gas, Insurance, Parking, Taxes, all cost 2-3 times as much there as they do here. (if not more) This is what is killing the desire for people to buy cars there.

    The trend here will be much slower as outside of Portland cars are a way of life. Cars have been a part of America\’s culture for so long that the switch to mass transit and bikes will not come without a major shift in both government and society\’s view of transportation. I would imagine that even $5 a gallon gas couldn\’t shift the economy quickly.

    Sure, Americans would complain, but would we move closer to the office to save gas?

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  • Torfinn January 16, 2008 at 12:14 pm

    Well, 5$ a gallon of gas is exorbitantly more than 5$ a gallon considering the additional cost in goods and services as a result of it.

    You notice the cost of Milk and Egg\’s or bricks of cheese lately?

    Realistically all of these things are leveraged against the price of a bbl of oil, and as that rises so will every other expense to a degree that driving will become much less affordable for the typical American if they choose to continue eating Arugula instead of iceburg lettuce in their salads.

    Considering the weight of the average households debt, the current leveraging of Home loan availability, and a rapid inflation increase mixed with a drop in the dollar\’s value… well 5$ a gallon gas isn\’t quite as inexpensive as you may think.

    Generally I think our current economic trend is usually followed by some growth in unemployment as well, which will only exacerbate things.

    I could be wrong, but I\’m going to plan financially as if I\’m right. In the long run it\’s more prosperous to plan that way anyhow. I think alot of people in this country could use a good fiscal kick in the ass. Our credit culture isn\’t one I\’m very proud of.

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  • Torfinn January 16, 2008 at 12:18 pm

    I gotta say as well, in Germany last time I was there, the cost of important products like food, and even beer in relation to incomes actually seemed quite a bit more manageable to me.

    Owning homes was as expensive as the more expensive areas in the states, while renting was reasonable. Vehicles are less for casual transportation obviously as a result.

    I think our culture tends to believe that it\’s our divine right to continue to own large homes and transport ourselves however we please without great expense. I don\’t necessarily know how realistic it is for that to continue.

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  • Todd B January 16, 2008 at 12:38 pm

    Though in developed high-cost cities cars still have one strong value: affordable private space.

    As housing become an expensive commodity…the private ‘auto’ is the last opportunity for ‘affordable’ secure individualized space…where else can one have excellent air con/ heating, stereo/ DVD, and independence? And no parents to bother you…

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  • dennis kruger January 16, 2008 at 12:54 pm

    I\’ll really believe it when I hear \’Bike Talk\’ instead of \’Car Talk\’ on the local NPR station.

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  • joeb January 16, 2008 at 1:16 pm

    I\’ve always been offended by the \”American\’s love their cars\” statement. I\’m not interested in taking my identity from the kind of car I drive, thank you. In high school 20 years ago, I actually did kind of love my 12 year old Datsun B210 because it was small, efficient and went from point A to B. Cars have always only been a utility to me for transportation. I just wish it hadn\’t taken me so long to discover biking for transportation 2.5 years ago.

    When my current mini two seater pickup with standard transmission, no powersteering, no AC, no radio, no electric windows, no intermittent wipers finally gives up (which may be 20 years at current rate of usage) I\’ll replace it with Flexcar and Amtrak with bike. New cars are only new for about 2 days, then it\’s just a can with a radio and a payment.

    I think I bike about twice as far as I drive these days and then rarely single occupant. This tank of gas has lasted since my trip to Seattle on October 14. Now if only oil companies could start feeling a pinch…

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  • Mike January 16, 2008 at 1:37 pm

    Torfinn, (#16-17)
    I couldn\’t agree more. Things are going to get more expensive, and soon. The question is how expensive does it have to get before Joe Blow American sees the advantage in moving all his earthly possessions closer to his place of work? (Or working closer to home) Given the current political state, I can see the government subsidizing gas before the general culture wakes up and realizes that their own habits are the problem.

    I moved jobs to shorten my commute a year ago, and now I\’m talking to my wife to get her to switch jobs. It\’s a big lifestyle change, and I don\’t think that she is willing. She likes working far from home, and will keep driving 35 miles a day to do so. Sure its expensive, but she loves her current job. It would have to get a lot more expensive before she would be willing to give up her coworkers and seniority. I don\’t feel that she is all that out of line either.

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  • Cøyøte January 16, 2008 at 1:37 pm

    Lane\’s comments seem out of context. Like he was talking about somehting else and this was the sound bite. It is so out of character for an autoexecutive to say that interest in cars is waining.

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  • Liz January 16, 2008 at 2:22 pm

    The quote doesn\’t say \”increasingly not interested in cars\” as in your title, but \”increasingly not interested in NEW cars\” according to the story snip. There is a huge difference between the two. I\’m surprised no one else has commented on that.

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  • Liz January 16, 2008 at 2:27 pm

    Not to say that the rest of it wasn\’t positive…

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  • Moo January 16, 2008 at 3:19 pm

    The next generation is upon us, and maybe they have seen,listened and learned. Car payment + insurance + gas + traffic congestion = unhealthy choices on a budget. Even carpooling, if driving\’s a must, off-sets some of these depressing reasons for spending your cash.

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  • divebarwife January 16, 2008 at 4:10 pm

    I think there\’s a bit of – hooray no more cars – going on here. My thoughts are that what he\’s really talking about is people are no longer freakishly obsessed with their cars. No longer is what you drive a status symbol. No longer do guys feel the need to get under the engine and \”prove themselves to be men.\” We all still want our cars – with a few exceptions – we just want them to be affordable and efficient means of transport rather than something we\’re obsessed with.

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  • BikingViking January 16, 2008 at 4:26 pm

    Maybe Nissan should start manufacturing bikes!

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  • brady January 16, 2008 at 4:36 pm

    I used to like to drive, back when, as someone said earlier, the roads were open. Sustainability was the last thing on my mind… (it was the early 90s and I grew up in Ohio). Sustainability aside, though, it\’s just no fun to drive a car anymore… who wants to sit through 4 light cycles at every intersection, paying dearly for gas all the while. No wonder people are so aggro out there.

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  • Fritz January 16, 2008 at 4:41 pm

    Wow, that *is* interesting.

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  • Matt Picio January 16, 2008 at 5:04 pm

    I think Liz (#24) hit the nail right on the head. Speaking as a former Detroiter, who worked in the auto industry for 3 years – this is right in-line with the normal speaches at the NAIAS (the Auto Show): paraphrased \”People don\’t seem to want to buy new cars, anymore – we need to figure out why, and get them to buy more new cars\”. Remember, the auto industry doesn\’t care how many cars are on the road, or how many lanes-miles of road there are, or travel times, fuel economy, or anything else. They only care about 4 things: (1) Make as much money as they can (2) selling the cheapest cars possible (3) to as many people as possible while (4) spending as little as possible on safety and government mandates. Yes, that is a really cynical outlook on the industry, but that\’s it in a nutshell – cars are the perfect example of a product designed to only last X number of years (usually 10). The Euro and Asian carmakers are almost as bad as GM and Ford – in part because they\’ve had to be to remain competetive after American companies eliminated the Japanese technical and procedural advantages of the 1980s and also in part because GM, Ford and Chrysler now own significant portions of the other companies – Ford, for example owns 33% of Mazda. For more examples, check here: http://carscarscars.blogs.com/index/2004/03/who_owns_who.html

    We really don\’t want any of these guys making bicycles – or do we? GM was world-recognized for the locomotives it built through EMD (Electro-Motive Division) – ironic since they killed the streetcar. I wouldn\’t want Ford building my bike – it\’d suck if I rolled my mountain bike and it exploded. 😉

    Anyway, I think this is business as usual. I think the story the other day when GM\’s CEO basically acknowledged Peak Oil publicly is actually the bigger headline.

    That said, I do think this is important, and thanks, Jonathan for covering it!

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  • John January 16, 2008 at 5:07 pm

    I\’ve always been economy minded with cars. The 1994 Ford Escort wagon I bought for $2K a few years ago that still gets at least 30mpg is my case in point.

    As much as I enjoy biking to work, doing it every day takes the fun out of riding on the weekends. So I bike commute 2-3 days per week and drive the rest. A car is also necessary to get my road bike to centuries and my MTB to the trailhead. My car is also necessary to get the members of my family that physically can\’t ride a bike to the store, doctor, etc.
    A car is still (unfortunatly) necessary for many of us. But you can minimize the cost by buying used, and by buying models that have cheaper insurance rates. I got rid of my last new car that had the loan and expensive full-coverage insurance when I realized how much it just sat in the driveway as I ride my bike most of the time anyway.

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  • […] more at CNN Money. Props to Bike Portland, where there’s more commentary on this trend. // Used for showing and hiding user […]

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  • Former 49er.. January 16, 2008 at 7:56 pm

    This is the truth… at least for me. I grew up traveling EVERYWHERE by car. I got a driver\’s license at age 16. I used hand-me-down cars til I was 23 and then bought a brand new car. I sold my car 2 years ago and never looked back. I now ride transit, walk or bike, and use Flexcar for all my transportation needs. There\’s no reason to waste thousands of dollars every year on car ownership when there are so many better ways to get from A to B.

    However, I\’m concerned that automobile companies are recognizing this trend. Just like the petroleum industry trying to interfere with the Safe, Sound and Green Streets program proposed by Sam, they will spend their $$ to coerce those in power through lobbyists and those with money through marketing to distort the economic and environmental disaster that results from excessive car ownership.

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  • sad January 16, 2008 at 7:56 pm

    There will always be cars, in some capacity or another – they\’ll just think of another way to power them. I actually wish that everyone would just start driving Hummers so that we can use up the rest of the world\’s oil sooner and the powers that be would be forced to develop a cleaner fuel alternate. The longer that they can stretch the remaining oil by increased fuel economies, etc, the longer it will be before they turn to another source. Hybrids? They still run on gas, and they\’re going to milk that cash cow for all its worth, which is why nobody is seriously advancing technologies that don\’t use oil. Why focus on a technology that is being pushed further and further into the future by embracing the guise of \”green, hybrid energy.\”

    Solar or hydrogen or something entirely new that we haven\’t even thought of is the answer. Well, its the answer to truly green vehicles – nevermind the horrendous social and cultural effects that the automobile/freeway movement has had on our society. That talk is for another time. 🙂

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  • n8m January 17, 2008 at 1:36 am

    I thought it was rad when I saw a chevrolet foldable bike in Amsterdam a while back. Apparently they are from japan:

    http://chipple.net/mt/2004/07/21_001064.php

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  • Torfinn January 17, 2008 at 9:50 am

    @#34

    \”However, I\’m concerned that automobile companies are recognizing this trend. Just like the petroleum industry trying to interfere with the Safe, Sound and Green Streets program proposed by Sam, they will spend their $$ to coerce those in power through lobbyists and those with money through marketing to distort the economic and environmental disaster that results from excessive car ownership.\”

    You should revise that to; big businesses have been recognizing trends, and weighing cost/benefit/profit over ethics since long before any of us were ever born.

    Anyhow, Matt Picio appears to be speaking with a voice of experience and logic I\’m definitely siding with his view that this particular speach is nothing to spectacular. As I noted above and he reiterated, GM announcing publicly that they believe Oil production is now on the decline is a far more important statement, and is going to impact all of our lives much more drastically than how many new cars are sold this year.

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  • Matt Picio January 17, 2008 at 11:27 am

    Speaking with sarcasm, too – my dad worked for GM for 38 years, and one of the companies I worked for allowed me to go inside the design centers for the big 3 on a regular basis. There\’s a whole culture to \”Big Auto\” that I couldn\’t do justice in describing if I took 100 pages to do so. My first trip to Portland in 1987 was literally a life-changing experience (because of the excellent transit system and the bus mall), as was seeing the bike infrastructure when I moved out here in 2000. The highway they built near my parents\’ house (which was a 5-lane road when I was growing up) uses a 380\’ right-of-way (M-59, for those who are also from Michigan). A 380\’ ROW would never fly in Portland (thank goodness).

    Detroit\’s auto industry was once my lifeline, and now it stands in opposition to everything I\’ve dedicated my life to – needless to say, that changes one\’s perceptions a bit.

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  • DJ Hurricane January 17, 2008 at 11:41 am

    They only care about 4 things: (1) Make as much money as they can (2) selling the cheapest cars possible (3) to as many people as possible while (4) spending as little as possible on safety and government mandates. Yes, that is a really cynical outlook on the industry, but that\’s it in a nutshell…

    Cynical? No. Right-on.

    I work with the biggest corporations in Oregon on a daily basis. Profit, the bottom-line, is the only thing. The only thing.

    That\’s the legal standard for corporate actions (putting profit above all else), the standards that the Board will enforce, and the standard that keeps the pay checks rolling in.

    To the extent that the principals of big corporations say or act like they care about something other than profit, it\’s because they have figured out that appearing to only care about profit can decrease profit. Trust me.

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  • Torfinn January 17, 2008 at 12:58 pm

    The funny thing about that DJ Hurricane is, is that if Americans as a whole bothered to educate themselves, or really chose to only give business to corporations that they appreciated we\’d live in a whole different world.

    The reality is is that if it were profitable to be an ethical corporation, and not lie/cheat/steal your way to the top viciously destroying any sentiment of competition most if not all corporations according to the above ideal would indeed be ethical corporations.

    Instead we reward sometimes horrendously deplorable actions with our hard earned money often because many are simply so self centered or focused that unless they\’ve personally experienced a wrong they\’re not concerned with who they do business with, just the best deal/most convenient outlet.

    Our money often goes the path of least resistence, which just so happens to be everything that hurts us.

    Kind of funny when you think about it from that angle.

    Not that I think it\’ll ever change. Just something to think about next time you\’re at the grocery store, or buying lumber for that home remodel, or choosing a car or picking some cat food.

    😉

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  • joeb January 17, 2008 at 1:59 pm

    I just paid a 12% premium on a remodel project by specifying the use of FSC certified lumber. It was $1100 I could not afford. But what I could afford even less is to send somebody up to strip log Mt. Tabor (or some hidden old growth on Mt Hood). It hurt, but it\’s the true cost of doing business! Oh, I tried to justify that my measly little purchase of lumber was not significant enough to worry about especially compared to a 120,000 sq ft box. But I couldn’t be part of it. How can we keep taking at these rates?

    Is the car industry victim of their own success? They’ll find a way or a federal gift to come back. Perhaps they can purchase Altria to bolster their profits.

    Profit for profit’s sake alone is unsustainable. 30% gains are not sustainable. I would like to see a study of how long a company takes to recover from the political, financial, structural and infrastructural damage from one year of pursuing excessive profits. How about the turn around artist that cuts costs by layoffs and benefit cuts to grow profit? I’m no expert. Maybe Mitt Romney knows something about it.

    A bit off topic, my apologies. But Torfinn brought it up. 😉

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  • IanO January 17, 2008 at 10:39 pm

    The only cars I get excited by now are the ones pushing the technology boundaries, uch as the three-wheel electric models sold locally by Eco Motion and the sexy 300mpg teardrop Aptera.

    http://www.ecomotion.com/

    http://www.aptera.com/

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  • Matt Picio January 18, 2008 at 11:29 am

    joeb (#41) asked \”Is the car industry victim of their own success?\”

    I\’d say so. The number of cars & light trucks in the United States will soon exceed the US population. There are now over 243 million personal automobiles in the US, which has a population that just topped 300 million.

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  • Opus the Poet January 18, 2008 at 11:30 am

    I used to love cars myself, built hot rods and race cars, and worked at a race track selling tires every week. But back in 1995 my car blew up, and after learning how to get around a town designed for and about cars without one (not as easy as Portland, but I manage) I decided I could live without a car. Driving had changed from something that was fun, to something else I had to do. Now I don\’t have to any more

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  • LInda September 5, 2008 at 8:32 pm

    What we\’ve kind of been living by lately is the idea of not having to sell your car, just to use it less. Electric bikes are friggin\’ awesome. No license, no insurance, no gas, safer than a scooter! Ride on the sidewalks. Live to see another day. Check out http://www.ElectricBikeShopOnline.com. Sleek lookin\’ electric bikes and conversion kits. Good customer service too.

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