As US sales continue to tumble of a giant cliff, it becomes tempting to spin a short-term trend into a long-term projection. Just as peak oil theorists were everywhere last summer, warning that gas would never again cost less than $4 per gallon, many analysts now think that the US car market will never again reach 17m per year. Automotive News [sub] takes on the debate, fielding arguments from both sides. On the pessemistic front, players like Pricewaterhouse Cooper see the 17 million years as “an aberration,” artificially pumped up by a false sense of personal wealth, lax lending standards and irresponsible automaker incentives. Daimler’s Dieter Zetsche, Mazda’s Jim O’Sullivan, and private equity baron Wilbur Ross fall in the sub-17m camp as well. They collectively estimate an eventual recovery of 15-16m units by around 2012-2014. The other side of the argument is concisely summarized by Robert Schnorbus of JD Power: “Of course we will return to 16 or 17 million. Every recession we hear this argument that Americans have fundamentally changed, but Americans love their features and comfortable cars.”

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More artistry from the Best and Brightest. Our deadline is tomorrow night. Send jpegs to robert.farago@thetruthaboutcars.com.

Ex-Toyota and current Ford marketing maven Jim Farley tells Automotive News [AN, sub] that The Blue Oval Boyz “expect” to stabilize their U.S. market share– after a 13-year decline. And if that’s not stretching the boundaries of credibility (your call), Jimbo reckons the new Lincoln MKT and, what was it again? MKS “could” increase the luxury brand’s slice of the American pie. “We think we have a really good chance this year. We don’t know what the luxury market is going to look like, but the one thing we’re really focused on is making sure that people see our products as aspirational and they pay the price.” Although Farley fails to provide a plan to achieve this goal, AN reckons it could may maybe perhaps happen. “Lincoln could gain share even as the brand’s total sales fall below 100,000 for the first time since 1982. Lincoln finished 2008 with sales of 107,295, its lowest total since 1983. With forecasts for lower industry sales in 2009, executives acknowledged that new-vehicle entries may not be enough to keep Lincoln sales in six figures.”

Chrysler Cinquecento anyone? According to Reuters  [via Automotive News Europe], Fiat is in talks with Chrysler LLC to form a strategic partnership. Automotive News says the deal could give Chrysler access to platforms, engines and transmission. The august publication also suggests the dalliance could lead to Fiat taking an equity stake in Chrysler. FIAT has been on the prowl lately to find a partner. PSA apparently gave the Italians the cold shoulder. Fiat’s CEO Sergio Marchionne had made noises that his company cannot survive alone and is in urgent need of a strong partner. Eh, Sergio! You said “strong” partner! Cosa fai?

The hand held radio crackled, “Pace car, flag’s on the white RX-7. Get in front of him.” I was at the first ever 24 Hours of LeMons race to be held in Kershaw, South Carolina. I was behind the wheel of a Vitamin C Dodge Challenger SRT8 with a 6.1-liter Hemi good for 425 hp. We were using it to pace the race. My job was to get in front of a 1981 Mazda RX-7 running under yellow. No problem. 370 cubic inches of American muscle against a wretched 26-year-old rotary? I was about to be the Godzilla to his Japan. Hell, I’d even light it up a bit– give the crowd something to cheer about. Yeah right. I could barely get in front of the Mazda, let alone woo the teeming masses.

Redflex Traffic Systems and ChinaTel Group this week announced their hope of invading the potentially lucrative traffic surveillance market in the People’s Republic of China. Under a joint agreement, ChinaTel, a small provider of wireless broadband connectivity, would provide the communications infrastructure required for the red light camera and speed camera ticketing systems as well as provide local sales. “ChinaTel and Redflex’s mutually beneficial partnership will fully leverage their respective strengths on global operation and local distribution, creating synergy, extending their customer base, and expanding potential sales revenue,” the companies explained in a press release. “Both parties recognize the importance of the market opportunity for camera enforcement systems in China.”

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Automotive News [sub] reports that GM’s Zen Master/Product Guru Mark LaNeve is turning his back on ye olde (2006) “market pricing.” You know, where the sticker price reflects the actual selling price. Or thereabouts. “In terms of a pure strategy where we price right to market and have no incentive spending — we have very few vehicles where we’d do that. We’ll have some level of incentive spending almost across the board.” After that… I’m confused. Why has GM increased ’09 product prices by 2.7 percent (roughly $790)? And what’s this mean? “LaNeve said GM prefers to spend incentive money for competitive reasons — not to reduce inventory, as it has been doing, because the latter is ‘wasted money.’ “We continue to want to price our vehicles to the market. We’d like to see incentive spending wane once we get our inventories adjusted. I think it smoothes out after the first quarter. We’re hardly building anything in the first quarter.” So, Uncle Sugar’s paying GM not to build cars, so they can eventually offer incentives to steal market share from carmakers who aren’t being paid not to build cars? Sweet.

Definitely infrequent for a few weeks while I’m in Europe, hunting the elusive Euro: An overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off. WAS is being filed from Berlin – when I’m in Berlin.

Hybrid price war: Toyota plans to lower the Japanese price for the existing Prius hybrid when it releases a redesigned, more efficient version in May, the Nikkei (sub) writes. Japan’s top automaker will continue to sell the existing Prius after the new version’s release in May. Toyota plans to cut the price for the current model to around 2 million yen. Rival Honda is slated to release the Insight hybrid in February, with a starting price of less than 2 million yen. The remodeled Prius will cost 2.5 million yen.

Mazda cutbacks: Mazda will slightly increase plant operating hours in Japan in February and March, but will stick with its plan to cut output through March by 100,000 vehicles or more in addition to the originally planned 73,000-vehicle cutback for the period, the Nikkei (sub) writes. Mazda has started cutting salaries of manager-level employees by up to 10 percent from this month. Its executives already began returning 20 percent of their salaries to the company from December.
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The [UK’s] Blackburn Citizen reports that Blackpool magistrates sent a bailiff to Andy Miller’s house to collect an overdue £60 speeding fine. Actually, £350, what with court costs and all. “Father-of-five Mr Miller was driven to Accrington town centre. The bailiff parked up and waited for Mr Miller, but he collapsed in Union Street before he reached a cashpoint.” The 78-year-old died of a heart attack. Although the coroner ruled out an inquest, Miller’s family feels the court contributed to his death. “His son Mick said he wanted answers from court bosses as their letter [to the court explaining why he hadn’t paid the fine] told them his father was suffering from memory loss and confusion. Mick, who lives in Lower Darwen, said: ‘Bailiffs should not be allowed to behave like this. Dad was put under incredible duress. I know how nervous he had been and what a strain this would have been on him.”

My five-year-old looked into the bag and spied the chocolate-covered strawberry. “Just one?” she asked with equal parts indignation and incredulity. “That cost me six bucks,” I responded defensively. “I wish they were cheap,” Lola said as the treat succumbed to dental destruction. “Then we could have lots.” And there you have it: proof that price conquers all. If Godiva wants to sell me a dozen chocolate strawberries, all they have to do is lower the price. Dramatically. Of course, they can’t do that. Ingredients, labor, transportation, administration, marketing, rent, fancy bags– it all adds up. By the same token, there’s only one way automakers seeking to sell vehicles cars in today’s market can stimulate sales: slash their prices by 50 percent or so. Of course, they can’t do that. Or can they?

The E85 BOTDs are less frequent these days. Thanks to low gas prices, the ethanol industry has run headlong into what they call the “blend wall.” In fact, the corn juice supply so far outpaces demand that government subsidies, mandates and [the E85 folk hope] bailout bucks are all that stands between the industry and total collapse. In other words, here’s another auto-related enterprise whose survival depends on the taxpayers, rather than commercial success. So when I encountered E85 consumption figures for Iowa on MidwestAgnet.com, I nearly fell out of my chair. Well, OK, I’m too old for that action, but the numbers indicated a huge jump. [jump after the jump] And the answer is… “Quarters prior to 4th quarter 2007 did not include government gallons. Beginning with the 4th quarter 2007, government gallons are included.” I’m not entirely sure what government gallons are, but whatever they are, you can bet your bippy the tank-fillers had little say in the matter. There’s some interesting info if you follow the links to Iowa’s fuel tax revenue. Year-to-date to November 2008, the state collected $198,280,544. Of that, E85 accounted for $44,683. The year previous: $35,705. And this, folks, is The Tall Corn State. 

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And the hits keep happening. So this is how it’ll work. Eddy and I and other TTAC writers will select our faves and then submit the finalists to you, our Best and Brightest, for a vote. As in Wisconsin’s “change our license plate logo” contest, we reserve the right to over-rule the popular vote. (“Eat Cheese or Die?” I don’t think so.) But we will present the results of the poll– so you can see if we’re elitist scumbag hypocrites. Again, please send jpeg entries to robert.farago@thetruthaboutcars.com. The deadline is midnight Tuesday. [NB: The software tends to squish some images. Please click on it twice to see the proper proportions.]

Europe has an abundance of car makers. Apparently, Brussels is preparing the populace for less. As EU business ministers gathered in Brussels to discuss support for the flagging industry, as French manufacturers lobby their government for aid, European Union industry commissioner Guenter Verheugen said some European carmakers face an uncertain future.

“There is no guarantee that all the main European manufacturers can survive the crisis,” Verheugen told BBC radio. Translation: don’t bank on a bail-out. If you get in trouble, you’re on your own. There’s surely BIG trouble ahead; Verheugen forecasts a further 20 percent drop in sales in 2009. He said the industry’s outlook was “to say the least, brutal,” as cash-strapped consumers defer big-ticket purchases.

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