Name GM/Ford Junk Bonds After Father Of Hybrid Tech, NGO Suggests

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WASHINGTON, D.C.///May 9, 2005///"Now that the Standard & Poor’s rating agency has downgraded the General Motors Corporation and Ford Motor Co. to junk bond status, Wall Street should take the next logical step and refer to any such new debt issued by the struggling U.S. automakers as “Yaegashi bonds,” according to 40mpg.org, a Web-based campaign organized by the Results for America arm of the nonprofit Civil Society Institute (CSI) to promote higher fuel-efficiency standards for U.S. vehicles.

Why “Yaegashi bonds”? The little-known Takehisa Yaegashi is the Toyota engineer who is referred to in Japan as “the father of the hybrid.” Part of Yaegashi’s training took place in the United States where he realized that passage by U.S. lawmakers of limits on automotive tailpipe emissions would require cleaner, more fuel-efficient autos. The story of Yaegashi’s role in hybrids and the broader problem of the short-sighted thinking of U.S. automakers was spelled out more than a year ago in a prescient April 2004 MIT Technology Review article (“Hybrid’s Rising Sun”) by author Peter Fairley.

Civil Society Institute President Pam Solo said: “The reason that Japan has at least a six-year lead today on red-hot hybrid auto technology is because people like Yaegashi saw the handwriting on the wall more than 30 years ago and set out to do something about it. Japanese automakers built their pickups and SUVs just like U.S. automakers, but they also hedged their bets by focusing on fuel efficiency in a way that the U.S. companies did not. Hybrids are not necessarily yet a major factor in what ails Ford and GM today, but the Japanese leadership in hybrids reflects everything that is wrong at U.S. automakers.”

Solo added: “Detroit can try to blame things on short-term gasoline prices or a downturn in the U.S. economy, but this is actually a much more deeply rooted problem that goes back more than three decades. It’s not that the Japanese had an unfair advantage here or just that they were smart when U.S. companies unwisely rested on their laurels. Instead, Japanese automakers simply acted the way that U.S automakers used to act when they were intent on maintaining the edge in sales, jobs and technology. U.S. leadership in the global auto industry used to be Job #1, but today U.S. car companies are in real danger of getting the pink slip from consumers.”

According to a 40mpg.org national opinion survey released on March 17, 2005, more than three out of five Americans (63 percent) think the "hybrid technology gap" - in which U.S. automakers will fall further behind Japanese and other foreign automakers that have more fully embraced the new fuel-efficient technology – is a serious or somewhat of a problem. The extent of this concern among Americans is essentially bipartisan, including conservatives (60 percent), moderates (70 percent) and liberals (69 percent). Similarly, the concern about the hybrid technology gap is shared by 58 percent of NASCAR fans and 65 percent of car/truck/new technology enthusiasts.

The April 2004 MIT Technology Review article telling the story of Yaegashi reads in part as follows: “The Hirose plant is off-limits to journalists, but the story of Toyota's program is one that its architect-Takehisa Yaegashi, the unassuming engineer revered within Toyota as ‘the father of the hybrid’-is eager to tell. Drinking black coffee in a nondescript meeting room in Toyota's offices in Tokyo, Yaegashi traces the origins of Toyota's hybrid strategy back to the early 1970s, when the U.S. Congress set the first national limits on tailpipe emissions."

In 1971, Yaegashi was a 28-year-old mechanical engineer, two years out of Hokkaido University, when Toyota assigned him to its new clean-engine project. Over the next 20 years, he designed everything from exhaust-scrubbing catalytic converters to emission-reducing engine control systems. All this helped make Toyota's fleet of cars one of the cleanest sold in the United States …

But Toyota didn't stop at innovative catalytic converters. By the early 1990s-even as Toyota followed the lead of U.S. automakers by making popular but fuel-guzzling SUVs-Toyota's leaders prepared to redouble their efforts to clean up the automobile and make it more fuel-efficient. ‘We saw two things happening at the same time: demand for cleaner air and demand for greater fuel savings,’ recalls Yaegashi.”

The entire text of the Review article is available online at http://www.technologyreview.com/articles/04/04/fairley0404.asp?p=1.

http://www.ems.org/nws/2005/05/09/news_group_urges

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