At Large with Dave Smith: Bumpy Ride into the 21st Century

Ah, the new millennium. I can't go back to 1900 when the automotive industry experienced its birth pangs. But then, who can?

I can, however, look back to the final third of the 20th century, which I've witnessed close up - a metamorphosis cumulatively so tumultuous it would fill your hard drive to overflowing.

So for this 900-word exercise, let's look at the bumpy road traveled since the mid-'60s.

Then and now:

REGULATIONS * Emissions: In 1965 there were no national regulations. "Smog" had just been coined to describe Los Angeles' haze, and LA County was getting serious about automotive emissions. There was even talk of banning new car sales in LA if automakers didn't clean up their act. But the Angelenos were serious, and soon the newly formed federal Environmental Protection Agency (EPA) got on board. Now emissions are covered by a regulatory maze that has triggered a revival of electric cars, electric/combustion engine hybrids and a rush to perfect economically feasible, zero-emission fuel cells. Moreover, EPA rules are about to get a lot tougher. The agency is under a Dec. 31 deadline to draft new rules that will go into effect by 2004. Observers expect the new requirements will add $200 to the cost of a vehicle, with trucks targeted to match mandates for cars.

* Safety: Ralph Nader came to Detroit in 1966 as a virtual unknown to hawk his new book, Unsafe at Any Speed, in which he ripped the rear-engine Chevrolet Corvair for its propensity to roll over and kill people. Ralph researched Corvair for his master's thesis at the Harvard Law School, then turned it into a book. Soon a new acronym was born: FMVSS, the U.S. Department of Transportation's "Federal Motor Vehicle Safety Standards" that cover everything from bumper heights to air bags. Mr. Nader's safety crusade killed the Corvair in 1969, and it continues to haunt automakers - and save lives. Think air bags and "crush zones."

* Mileage: Two oil scares in 1973 and 1979, which wrought economic havoc worldwide, set into motion federal CAFE (corporate average fuel economy) standards forcing automakers to boost fuel economy in increments to today's 27.5 mpg (8.5L/100km) for passenger cars and 20.5 (11.5L/100) km) for light trucks. The U.S. Senate last fall considered forcing trucks to meet the car bogey, but that effort failed. Still, CAFE's impact continues to be felt. Automakers, for example, are forced to sell low- to no-profit small cars boasting high mileage to offset performance of more glutonous larger cars. But consumers have benefited from the industry's fuel economy technology push: Even big cars now get twice the mileage they delivered 20 years ago.

COMPETITION The U.S. "Big Three" had the market practically to themselves 35 years ago, although the growing popularity of Volkswagen's Beetle prompted General Motors Corp., Ford Motor Co. and Chrysler Corp. to develop their first wave of "import fighters:" Chevy's ill-fated Corvair, Ford's Falcon and Chrysler's Valiant.

In 1965, U.S. car and truck sales totaled 10,932,000, with imports taking a 5.8% share. Japanese automakers sold a paltry 24,300 cars and 6,300 trucks, all small, low-price, high-mileage vehicles. That helped during the '70s oil crises when the Big Three were saddled with "gas-guzzling dinosaurs," as the late American Motors Corp. Chairman George Romney called them.

Indeed, the Japanese became so successful that Detroit demanded and got import quotas to "protect American jobs." To avoid the quotas, the Japanese changed their strategies and set up North American factories, the first being Honda Motor Co. Ltd. in Marysville, OH, in 1982. "Transplant" thus entered the automotive lexicon.

By 1999 the North American Japanese transplants built 3,240,000 cars and trucks, or 18% of the total, and combined with imports from Japan they captured 27.5% of the U.S. market. Side note: Mercedes was hardly a blip in the U.S. three decades ago and Lexus hadn't been invented. They finished first and second in U.S. luxury vehicle (cars and light trucks) sales in '99, relegating perennial leader Cadillac to third and Lincoln to fourth.

GLOBALIZATION It has been going on since Henry Ford I set up a plant in Cork more than 90 years ago near his ancestral Irish home, but it became everyone's favorite buzzword - automakers and suppliers alike - in the '90s. Until then, automakers or their subsidiaries basically served their home markets. Now they're scrambling to produce common platforms across international boundaries, spawning big-time mergers, acquisitions, joint ventures and partnerships wherever there's growth potential. Daimler-Benz taking control of Chrysler. Jaguars and Volvos built by Ford. Rovers and Rolls under BMW's command. And the end is nowhere in sight as everyone zeroes in on "developing" markets such as China, India and South America, all targeted to emerge as huge markets in the 21st century.

TECHNOLOGY It's simply mind-boggling. Cars three decades ago had almost zero electronics. Now they commonly have 50 or more "computers" controlling everything from braking and stability to engines and transmissions, and soon will link your car to the Internet.

MANUFACTURING Technology is revolutionizing the plants, eliminating the toughest, dirtiest jobs and, thanks to benchmark Japanese methods, boosting quality and productivity that would have seemed insurmountable in the '60s. But this efficiency push also is taking a toll on the plant work force, making for some thorny issues with the United Auto Workers union- especially on the subject of "outsourcing" components to non-union facilities.

SUPPLIERS Their power traditionally resided mainly in supplying the lowest bids. They remain under price pressure, but they've assumed increasing responsibility for full systems and modules based not only on price, but their technology and global capabilities. That has spurred a consolidation wave that has yet to crest.

PRODUCTS Ford's Mustang created a sensation when it was introduced in April 1964, going on to a record-smashing 417,000 sales during its first year. There have been some big winners and notable losers since then. Chrysler's minivan, a word not yet common when it was introduced in 1984, stands out as a clear winner because it created an entirely new high-volume segment. Cadillac's Cimmaron comes to mind as a leader, if that's the right word, among the losers. Pickups and Jeeps were basically workhorses in the '60s. Now, along with other light trucks and sport/utility vehicles, they're accounting for half of total U.S. sales, with "hybrid" spinoffs - they look like SUVs but ride like cars - emerging as the next big niche.

So let's buckle up and cruise into the 21st century.