U.S. Automakers: Death by Environmental Movement?

Last Updated Aug 20, 2007 8:49 PM EDT

the Back of Toyota's HybridsThe U.S. Supreme Court ruling this week on greenhouse gas emissions is a major event for America's already-struggling car manufacturers, who come in at the bottom of environmental performance rankings. The high court's decision finally classifies carbon dioxide (i.e. car exhaust) as an air pollutant, which means automakers are likely to face higher fuel efficiency standards in the not-too-distant future -- a costly proposition. No less important than the ruling itself, however, is the signal it sends about the growing business impact of the environmental movement. An interesting BusinessWeek article by John Carey considers the effect of consumers' increasingly green preference on Detroit's "Big Three" automakers:
It's impossible to know how much of Detroit's sales declines and Toyota's gains reflect how green their cars are. But Ted Grozier, an associate at the environmental strategy consulting firm GreenOrder, believes that a fundamental shift in consumer preference is occurring. "We expect to see a lot more consumers choosing environmentally preferable vehicles," he says. And right now, Toyota may be leading the pack. Even though it's slightly behind Honda, it has a much broader vehicle lineup, with large sport-utility vehicles, cars, and pickups not offered by Honda. "One of the big stories in the rankings is Toyota," says UCS's MacKenzie [engineer for the Union of Concerned Scientists]. "It proves that size is no excuse for a dirty fleet. Toyota has big vehicles in categories where Honda does not compete, yet it nearly tied Honda" in the overall ranking.
It would take some really fancy statistical work to get a definitive sense of the influence of consumers' eco-preference on American car sales. But it's easy to conclude that the Big Three had better green themselves up, lest they become compost for their environmentally-minded competitors.

(Image of Toyota Prius by Beige Alert, CC 2.0)