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LETTERS

Technology Is Driving Down U.S. Auto Sales

January 05, 2003

The fundamental problem that the U.S. auto industry faces is not labor union contracts, pension payments or cost of parts. It is that they lost the technological edge to the foreign manufacturers who are producing cars with cutting-edge technology that simply outclass American offerings ("No Letup to Auto Industry Struggles," Dec. 26).

Furthermore, the competition among European and Asian car companies is relentless as they compete for market share at the expense of General Motors, Ford and Chrysler. Ironically, it is the pressure to produce cars that are not only attractive and powerful but also fuel-efficient that gives them the edge.

The low gas prices and the lack of fuel-efficiency requirements in the U.S. have caused American manufacturers to become complacent.

They have just about conceded the passenger car market to the imports and have relied increasingly on SUVs and pickup trucks for revenue. However, even there they are facing more and more competition from overseas.

It is generally acknowledged that there is a worldwide manufacturing glut in the auto industry, which will leave the less-competitive in a vulnerable position. Not a pretty picture for the U.S. car companies.

I can easily see them drifting in the direction of becoming shell companies that re-badge and merchandise Asian-produced vehicles, or design and assemble cars from key components produced overseas, a trend that is already in evidence.

Paul W. Rosenberger

Manhattan Beach

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