While leftist politicians and environmentalists keep telling us that the green economy will lead to high-paying jobs, don’t count recently fired Ford CEO Mark Fields in that number.
Ford’s stock price had fallen by 40 percent, in part because it was struggling to make a profit on its small- and medium-size cars—i.e., the cars environmentalists want us to buy.
In March, Ford reported, “Sales for its F-Series pickup trucks rose 9%, SUVs were up 6%. Ford's car sales fell 24% from a year ago,” according to Fortune.
The New York Times weighs in, “The company has also experienced a deep decline in the sale of small and midsize cars, leading some Wall Street analysts to suggest that it drop unprofitable models from its portfolio.”
I don’t know who these “analysts” are, but dropping small cars is virtually impossible, thanks to President Obama and the CAFÉ standards.
Congress passed the Corporate Average Fuel Economy (CAFÉ) standards in 1975. Its “purpose is to reduce energy consumption by increasing the fuel economy of cars and light trucks.” While CAFÉ has been with us for decades, the requirements had remained essentially unchanged for several years.
Obama decided the existing requirements weren’t green enough, so he imposed an unachievable goal.
According to CBS, “The standard for passenger cars stayed at 27.5 mpg from 1990 until 2007. In 2009, the government set a fuel economy standard of 34.1 mpg for cars and light trucks by 2016. In 2012, it set a new target of 54.5 mpg by 2025.”
Auto manufacturers responded in February, sending a letter to Environmental Protection Agency Administrator Scott Pruitt outlining the problems with meeting Obama’s green dream.
In order to reach that higher “average” while still producing the trucks and SUVs consumers want, U.S. car manufactures have to make more fuel-efficient small cars—or even electric cars, which dramatically help lower the average.
In other words, leftist politicians force car companies to make unprofitable cars people don’t want to placate the environmentalists whose votes they do want.
Ford was planning to move its small car manufacturing to Mexico to save money on labor costs—until Donald Trump was elected president. Auto manufacturers thought they could see some light at the end of the tunnel.
The Trump administration has promised it will review the Obama-imposed CAFÉ standards, and that review can’t come soon enough.
It’s too late to save Mark Fields’ job, but it’s not too late to save the US. auto industry.