Dear Editor, I must admit to a double-take when reading your correspondent John Cranage’s statement that the motor industry “deserves help to survive a crisis most definitely not of its own making”.
Really? While I can well appreciate that the banking crisis has put every sector of economic activity into a stressful situation, the motor industry has perpetuated a myth that its activities are in some way ‘special’ and devoid of any need to apply plain economic principles.
Globally, the motor industry has an annual capacity of 93million vehicles. The best estimate of demand is 60million vehicles. These are figures published by the European Commission and recently confirmed by Fiat boss Sergio Marchionne.
They demonstrate a complete disregard for market dynamics and, when the going gets tough, the car companies start bleating and expecting the taxpayer to step in.
There are many other areas of industry which, using the same logic, could quite justifiably describe themselves as similarly ‘special’.
If there is a good argument for government (ie taxpayers’) money being used in an interventionist way, then the intervention should be used to promote future projects rather than perpetuating ‘more of the same’.
Cedarwood Croft, Great Barr, Birmingham