If fuel prices stay low, the manufacturers are going to have a big mismatch between what the govt requires them to build (Corp Average Fuel Economy regulations) and what people want to purchase (Pickups and SUVs).
There will be BIG incentives on small cars.
Most small cars are money losers.... Last I checked Chrysler was losing money on every Fiat it sold.... only does it to keep its CAFE rating. Small cars have no margin, because no america is willing to drop big money for them.. so manufacturers can’t get premium prices for them no matter how hard they try.
When the economy truly picks up, they are going to be even harder to sell.
Indeed, and Mr. Hamilton expounded on that.
(I was being sarcastic, I’m enjoying the cheap gas in my Pontiac G8, whee)
Interestingly, word is that Fiat/Chrysler is dropping the Dart/200 because economy cars are a loser and they want out, so that they can focus on the profit center trucks and SUVs. In line with this, they may contract with another manufacturer to produce a compact for them.
I rented a Mazda 2 recently, and while a cute and efficient li’l car, well, it wasn’t quite the same. The interesting thing is that Toyota contracted with Mazda and is now selling it as a Scion. Back in the 90’s, GM sold the Corolla as a Geo. It’s a crazy, mixed up world.
(And I really wish I could buy a new G8 when my old one gets long in the tooth, but alas...)