Can Detroit Go Green Before the Green Runs Out?

Last week, Detroit auto executives drove to Washington, D.C. in their brand’s favorite hybrids (a far cry from the big, private jets they took to the capitol early this fall). The purpose of this second meeting was to reveal their plans for using the potential $34 billion in low-cost loans wisely. With sales tumbling and costs of all sorts rising quickly, the whole American industry is pinning its hopes on a greener future. (BTW, $34 billion might be $15 billion at best…)

So, what are their plans?

General Motors, the largest American auto maker is gunning for $18 billion in bailout money. Its plan for being more fiscally responsible includes shutting many plants, reducing executive pay and even cutting several brands, including Pontiac and Saab. Buick, Chevy, Cadillac, and GMC might survive. The auto giant, whose sales dropped 41% in November 2008 compared to the same month in 2007, will funnel most of the savings into accelerating development of more fuel efficient vehicles and energy saving technologies.

Ford, like GM, is slashing executive pay by 20-30%. Even the CEO will take a pay cut, all the way down to just $1 per year. Their cost saving measures will also include employee benefits changes and no more common stock dividends. They also plan to reorganize their company to operate more efficiently. The new focus of Ford (not referring to a small car redesign) will be increasing fuel efficient vehicles, including more hybrid cars and more aggressive work on developing a plug-in electric hybrid vehicle.

Chrysler, where the CEO already earns just $1 a year, is planning cost-saving measures as well. The company had been anticipating a loan from the Department of Energy earlier this year, but that feel through. Again, the restructuring plan at Chrysler includes investing more resources in greener options.

It seems as if going lean and green is the American auto industry’s only choice. It is sad that it had to come to this final pitch to the government, pleading for cash to keep thousands of American workers in jobs, when the situation might have been avoided with less greed and more proactive planning. However, anything that can green our transportation is a good thing, as it is one of the leading causes of pollution.

What do you think? Is the prospect of greener American cars going to save Detroit?