Posted by: carboncreditsusa | January 22, 2009

National Gasoline Tax Vital For Long-Term Viability Of U.S. Auto Manufacturers And Auto Dealerships

“…Mike Jackson, CEO of AutoNation Inc., said Wednesday consumers will not buy fuel-efficient vehicles, such as hybrids and electric cars, while gas is less than $2 a gallon.

“Consumers are not going to pay for fuel efficiency if gas is cheap,”

The automotive industry is investing billions to develop technology to reduce the nation’s dependence on oil, but cannot recoup those costs unless they charge a premium for the vehicles.

 

http://www.freep.com/apps/pbcs.dll/article?AID=/20090122/BUSINESS01/901220358&template=printart

 

While acknowledging that fixing the economy should take precedence over a gas tax for now, Jackson said he thinks the nation should adopt a gas tax that would increase the price of a gallon of gas 20 cents per year for five years, eventually adding about $1 to the overall price of a gallon.

The reason: The automotive industry is investing billions to develop technology to reduce the nation’s dependence on oil, but cannot recoup those costs unless they charge a premium for the vehicles.

“Consumers are not going to pay for fuel efficiency if gas is cheap,” Jackson said after speaking at the Automotive News World Congress, an industry conference in Detroit.

Ft. Lauderdale, Fla.-based AutoNation is the nation’s largest auto dealership group with 313 new-vehicle franchises in 15 states.

Jackson also expressed his support for efforts to restructure the automotive industry and the dealership networks as General Motors Corp. and Chrysler try to meet the terms of government loans, which require them to be viable for the long term.

Domestic dealerships in the United States are struggling to make money because there are too many of them, and the market share of domestic manufacturers has declined. Because of that, many of the most-talented salespeople and managers leave domestic dealerships to work at those that sell foreign cars, Jackson said.

“You can’t attract capital or any talent because you can’t make money,” Jackson said. “There needs to be a major rationalization.”

However, Jackson said this is not the time to change the state dealership franchise laws that make it difficult for manufacturers to eliminate dealerships.

“I don’t think the franchise laws are the issue. I think the issue is with the manufacturers,” Jackson said.

Jackson said the ideal car dealership would be a 20-acre urban site that sells vehicles made by all manufacturers under one roof. An auto mall like that, Jackson said, would be better for dealers and customers.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Categories

%d bloggers like this: