Detroit's auto industry is changed, but not as Washington planned

Mon Jan 11, 2016 10:14am EST
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By David Shepardson and Paul Ingrassia

DETROIT (Reuters) - When U.S. President Barack Obama visits Detroit's annual auto show on Jan. 20, exactly one year before he leaves office, he is expected to tout how much the industry has changed since he orchestrated a federally funded rescue in 2009.  

But many of the changes on display at the city's annual auto show will not reflect the green-transport revival the president envisioned.

"We said the auto industry would have to truly change, not just pretend that it did," the president said Saturday in a weekly radio address devoted to Detroit.

The 'Detroit Three' automakers racked up record sales and profits in the U.S. market last year not because of electric cars or plug-in hybrids, but because of soaring demand for pickup trucks and sport utility vehicles fueled by gasoline prices that hit multi-year lows.

At General Motors Co (GM.N: Quote), the focal point of Detroit’s bailout, pickups and SUVs accounted for nearly 70 percent of last year’s sales. In 2016 one of the SUVs GM sells in America - - the Buick Envision - will be, for the first time, imported from China, to the chagrin of the United Auto Workers union, a key Obama constituency.

With oil prices expected to stay low for some time, all the major automakers are looking for a bigger slice of U.S. truck market profits.

Nissan Motor Co (7201.T: Quote) and Honda Motor Co (7267.T: Quote) are using auto show press previews on Monday to promote new versions of their full-size pickups, the Titan and the Ridgeline, respectively. 

The big splash from bailout beneficiary Fiat Chrysler Automobiles (FCHA.MI: Quote) is not a small car, but a sleeker, updated minivan, which comes in a plug-in hybrid version and a powerful gasoline model more people are likely to buy. There are also new luxury vehicles to be unveiled: a revamped Lincoln Continental is expected from Ford Motor Co (F.N: Quote) and Hyundai Motor Co's (005380.KS: Quote) new flagship luxury sedan, the G90.   Continued...

Buick introduces the Avista concept vehicle during a media event before the start of the North American International Auto Show in Detroit, Michigan January 10, 2016. REUTERS/Rebecca Cook