Motion System Design
American manufacturing needs good karma

American manufacturing needs good karma

A few days ago, the Department of Energy approved a $528 million low-interest loan for Fisker Automotive, one of four automakers selected by the DOE to participate in its $25 billion Advanced Technology Vehicles Manufacturing program. Tesla Motors, Ford, and Nissan are the other three beneficiaries. The program's goal is to boost domestic manufacturing of battery technology and battery-powered cars. Fisker will use some of the money to complete development of its snazzy Karma sports car, pictured below, and then spend the bulk of the funds on developing a more affordable plug-in hybrid, called Project Nina (named after the Christopher Columbus vessel).

Karmas will be manufactured later this year in Finland, while the Nina plant will be built in the U.S., and is expected to roll out vehicles in 2012. The Nina will be priced around $39,000 after tax credits, and the company forecasts that it will sell about 100,000 of the cars each year. Both the DOE and Fisker expect these projects to create or save at least 5,000 U.S. jobs.

Beyond building hybrid cars, the DOE and new administration are pouring plenty of money into other programs aimed at reinvigorating American industry and advancing new energy technologies such as wind, solar, energy-efficient lighting, and “smart grids.” One hope is that the American products and designs that come out of this stimulus money will not only be sold here at home, but exported to other countries as well. However, it will take a delicate approach to make that happen, with policies that carefully balance open trading with what you might call the desire to hang on to the security blanket of protectionism.

Few leaders that advance protectionist policies readily admit to it, with many in government and industry preferring kinder, gentler terms like “trade enforcement.” However, foreign groups know it when they see it. For example, the recent 35% tariff on Chinese tire imports that the U.S. has enacted is catching criticism overseas: Needless to say, the Chinese (our biggest creditors) are none too happy with the duty. That's why some fear that the tariff, which is meant to protect the American tire industry and workers, will backfire by spurring other countries to protect their home industries as well — thereby impeding U.S. exports and hurting American workers in other industries.

If America wants to build good karma around the globe — so that we have receptive global markets for our own creations — we need to examine how we trade with the rest of the world, especially emerging economies like China, India, and Brazil.

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