Big and Bad

Thursday, April 8th, 2004

I’ve become a great fan of Malcolm Gladwell, author of The Tipping Point, and I found his latest article, on SUVs, Big and Bad, full of interesting tidbits:

In the summer of 1996, the Ford Motor Company began building the Expedition, its new, full-sized S.U.V., at the Michigan Truck Plant, in the Detroit suburb of Wayne. The Expedition was essentially the F-150 pickup truck with an extra set of doors and two more rows of seats — and the fact that it was a truck was critical. Cars have to meet stringent fuel-efficiency regulations. Trucks don’t. The handling and suspension and braking of cars have to be built to the demanding standards of drivers and passengers. Trucks only have to handle like, well, trucks. Cars are built with what is called unit-body construction. To be light enough to meet fuel standards and safe enough to meet safety standards, they have expensive and elaborately engineered steel skeletons, with built-in crumple zones to absorb the impact of a crash. Making a truck is a lot more rudimentary. You build a rectangular steel frame. The engine gets bolted to the front. The seats get bolted to the middle. The body gets lowered over the top. The result is heavy and rigid and not particularly safe. But it’s an awfully inexpensive way to build an automobile.

I still don’t understand why cars and trucks have different safety requirements (based solely on the fact that they are cars and trucks.)

Anyway, the Expedition obviously made good business sense:

Ford had planned to sell the Expedition for thirty-six thousand dollars, and its best estimate was that it could build one for twenty-four thousand — which, in the automotive industry, is a terrifically high profit margin. Sales, the company predicted, weren’t going to be huge. After all, how many Americans could reasonably be expected to pay a twelve-thousand-dollar premium for what was essentially a dressed-up truck? But Ford executives decided that the Expedition would be a highly profitable niche product. They were half right. The “highly profitable” part turned out to be true. Yet, almost from the moment Ford’s big new S.U.V.s rolled off the assembly line in Wayne, there was nothing “niche” about the Expedition.

Ford started running its Michigan Truck Plant 24 hours a day.

By the late nineteen-nineties, it had become the most profitable factory of any industry in the world. In 1998, the Michigan Truck Plant grossed eleven billion dollars, almost as much as McDonald’s made that year. Profits were $3.7 billion. Some factory workers, with overtime, were making two hundred thousand dollars a year.

Customers, of course, buy large SUVs because they feel safe, even though they aren’t. Not only don’t they withstand impacts as well as, say, mini-vans, but they lack the maneuverability to avoid impacts.

Most of us think that S.U.V.s are much safer than sports cars. If you asked the young parents of America whether they would rather strap their infant child in the back seat of the TrailBlazer or the passenger seat of the Boxster, they would choose the TrailBlazer. We feel that way because in the TrailBlazer our chances of surviving a collision with a hypothetical tractor-trailer in the other lane are greater than they are in the Porsche. What we forget, though, is that in the TrailBlazer you’re also much more likely to hit the tractor-trailer because you can’t get out of the way in time. In the parlance of the automobile world, the TrailBlazer is better at “passive safety.” The Boxster is better when it comes to “active safety,” which is every bit as important.

Definitely read the whole article.

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