our way is paved with good intentions

Interesting how early foresight can come back to bite one in the ass. The 1988 Alternative Motor Fuels Act gave credit to auto companies toward their CAFE standards for developing engines that could use "alternative fuels." In 1988, that meant ethanol, as electric cars were still pretty Flash Gordon and no one had heard of a hyrid. The Act was renewed in 2004, but the context has changed greatly - hybrids now present the greatest opportunity to reduce oil consumption, eclipsing the gains that could be had by ethanol (there's little agreement on whether ethanol is much of an improvement over gasoline). So it doesn't incentivize producing cars that are more efficient and don't burn gas as much as it incentivizes producing cars that burn ethanol.

Credits are available for producing hybrids, too, but if you get a credit either way, and one way costs more, any business focused strictly on the immediate bottom line will happilly cut it's long-term throat. Ford declared itself just such a company by dropping hybrid goals it had declared in favor of using the same old designs with some cheap modifications and uncertain advantages (and it was the most progressive of the Big 3 on hybrids). Congrats, dinosaur. Toyota, on the other hand, is in the fight for the long term, increasing its investments in hybrids, grabbing more market share, and having a clear impact on oil use. Back to the Alternative Motor Fuels Act - in this case, is it enough of a factor in Ford's decision that it can be identified as one of the causes for the continued pathetic performance of the American car industry?

Ford shareholders: Take the loss, dump Ford, and buy Toyota.

Thanks to Treehugger.com.