Here’s the latest reader question, along with my reply!
Fred asks: Why can’t Elio Motor begin production? Is the Big Three manufactures blocking? Are they afraid of the competition? I would like to buy one.
My reply: Me too!
So why can’t we? It’s got much to do with something called regulatory capture – which is a fancy way of saying the cost of doing business. When Henry Ford designed his Model T, he did not have to design it for the government. He just designed it – and the market decided its merits.
It was very simple – even crude. By today’s standards, the T would be considered by many people outrageously “unsafe” and other things, too. But it is precisely because Henry Ford was able to just design and build the T without having to spend a fortune on research and development to assure compliance with a litany of regulations that he was able to build his Model T.
Well, once the car companies became huge corporations, they began to see the value of regulations and compliance costs. They could afford them – but start-up rivals could not.
That is Elio’s main obstacle. Complying with all the fatwas and getting federal “certification” for sssssssssssssssssssssaaaaaaaaaaafety and emissions is an arduous and very expensive process that few start-ups can afford. We’re talking millions of dollars.
Elio is also up against a culture that no longer esteems living modestly, within one’s means. People are eager to saddle themselves with massive debt. An $8,000 car they could probably write a check for – or at least, which would only take a year or two to pay off – seems less appealing than a $35,000 car they’ll be making payments on for the next seven years.
I don’t get it, myself.
But then, I’m a kook!
. . .
Got a question about cars, Libertarian politics – or anything else? Click on the “ask Eric” link and send ’em in!
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