GM and Chysler Bankruptcies

[kandrathe]

I have to agree with Roland, the only sustainable way of keeping the economoy healthy is using cars for longer time accompanied by a dramatic reduction of new car production. Making and selling cars works for the bubble economy (money keeps flowing) but for the real economy throwing away expensive things that still work is a waste.

Well, I don't agree.

The quality of cars is such that they last between 12 and 20 years if they are driven regularly (they last much longer if they never leave the garage). Yes, some people buy a new car every 3 to 5 years, but those used cars do not just get scrapped. The used cars are sold and bought by poorer (or smarter) people who care for them and try to get the most lifespan from them. While I certainly could buy a new car every year, I don't. I look at a vehicle as a rapidly depreciating asset, so I try to find one that has been used for 2 or 3 years. Then, I take very good care of them. I've only ever bought two new cars in my life, and only one of them was a huge mistake. It was foreign, and was very expensive to maintain. I owned it for 10 years, but it still cost me over $10K per year to own it. The other was a car my wife drove for almost 15 years, had driven it over 300,000 miles, and she wrecked it three times too. She still misses that car.

The way to affect the demand for automobiles would be to reduce the number of miles people need to drive. This can be done by the Government if they 1) required people to live closer to their work, 2) implement a massive transit system, 3) tax gasoline at much higher levels, 4) take over GM to control the quantity of vehicles produced.