Tuesday, June 02, 2009
The demise of stage coach companies and of the rail barons was arguably "creative destruction" at work. Companies that didn't see the future, and didn't invest in the next generation of technologies, were eclipsed by air carriers and auto manufacturers.
It may be a sign of the future that GM and Chrysler are in bankruptcy. That there's little interest by other companies in acquiring them. That nobody's trying to start a new major automotive manufacturing concern to take their place. Arguably, the world is ready for the successor to the automobile.
But there's no successor technology on the horizon. GM and Chrysler succeed or fail in a market that's going to keep producing cars and trucks, pretty much the way they have for the past half-century.
It's not clear what product will replace the car in the era of $4, $5, $8/gallon gas. Perhaps we'll be looking at alternative fuels, electric cars, new hybrid technologies, etc., as many people project. But I have a sense that any auto company that isn't prepared for that future, even those that are currently comparatively strong, should consider itself on reprieve.