According to yesterday's Washington Post, all those Priuses Toyota has been selling aren't making them much money. Rumor has it that those touted hybrid SUVs General Motors has been parading aren't turning profits either. What about the Chevy Volt? In June, GM Vice Chairman, Bob Lutz, said that the highly anticipated plug-in hybrid would be priced at $40,000 in its first year and would generate no revenue.
All the while, Congress is staking any bridge loan money on demands that the American Auto Industry "retool" to develop highly efficient cars that run on alternative fuels in the near term. This puts the car companies in the quandary of committing to sell unprofitable cars to get enough government money to keep them in business. Does anyone see a problem here?
"These are hard choices," says Toyota chief technology officer Bill Reinert, of the Prius design team. "Do you bet on lighter, smaller, more fuel efficient but ultimately less profitable cars or do you hold back a little on technology development and look at new versions of existing cars." Toyota may have the luxury of pondering this question while the economy is tanking. Detroit's finest may not.
Source: Washington Post, Image: Toyota