Novelist Joseph Heller coined the phrase “catch-22” in his 1961 novel of the same name to describe a paradox in which one is a victim regardless of the choices he makes. Auto makers currently are facing numerous catch-22s, including the fact that while stringent new fuel-economy and emissions regulations loom on the horizon in the U.S. and Europe, consumers still are demanding more of everything: more horsepower, more interior room, more safety. Buyers also want vehicles that get better ...

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