The auto industry is at a crossroads, what with uncertainty over fuel prices -- uncertainty that has found its way into the economic and equity market malaise -- among other factors. In some ways, it’s a function of job uncertainty, which translates into more restricted family budgets, into increased reluctance to buy anything, into stretching the life of one’s current set of wheels, and into more car companies checking into sick bay, hoping for government aid. Another factor is the availability -- and inevitability -- of vehicles running on alternative fuels, given the finite quality of fossil fuels.
Accordingly, because this site spotlights equities for investors keen on taking on measured risk, it’s appropriate that the hopes and fears of all the years are met in Monte Carlo, Monaco next month, a world capital for sun, fun, films, and gaming tables. Top Marques Monaco, as the auto show dubs itself, is ''the haute couture of the automobile industry, displaying a panorama of the world’s most prestigious luxury, sports cars and supercars, as well as products from the greatest luxury industries.'' It provides the Louvre of motorcars, where the art of the automobile muscles its way ahead of commerce, however slightly, where the state of the art is on display for four days, from April 16 to 19.
Such exhibitors as Aston Martin, Jaguar, Mercedes Benz, Bentley and BMW, Lexus, Ferrari and Rolls-Royce are showing their newest jewels to the world. Sleekness, speed and rarity constitute three traits their products possess in abundance, and the above manufacturers are not shy about saying so.
But the big, established automakers listed above should be on their best behavior, for the Scorpion is on the prowl. The Scorpion™ is the latest sportscar from Texas-based Ronn Motor Company (Pink Sheets: RNNM), an eco-friendly supercar running on hydrogen. After making waves in its home country, the Scorpion is staging a European invasion. More in a moment...
Critics of the auto industry, most notably filmmaker Michael Moore, have pointed out that the big three North American automakers should have seen their current financial predicament coming, by their failure to make the kind of cars and trucks people want to buy. The naysayers state that Asian manufacturers like Honda, Toyota and Nissan and Mazda (now having red ink problems of their own) consistently beat Ford, General Motors and Chrysler to the punch by cornering the market on hybrid vehicles which run on electric power and gasoline, as well as on vehicles that aren’t so wasteful with the petroleum on which they do run.
Only now are the 'Big Three' even appearing to catch up in the hybrid derby, with Ford’s Escape, Mercury Mariner, Chevrolet Malibu and Silverado hybrids even making some industry top-10 lists for fuel efficiency. The latest survey from www.fueleconomy.gov still lists Toyota, Nissan and Honda atop the list, with the Toyota 4.0-cylinder Prius occupying number one with 48 miles to the gallon in city driving, leading to an annual cost to run of just over $600 (all figures in U.S. funds unless specified otherwise.). The Escape costs close to $900. If the 'Big Three' car companies are to come of this current climate intact, more of their efforts have to be put into making these fuel-efficient vehicles -- and the results will have to show themselves -- soon!
To be fair, there are some makes making headway on alternative fuels… flexible fuels, if you will. Chevrolet has come across with a Four-Wheel Drive that runs in part on ethanol, travelling 19 miles to the gallon, and 26 miles to the gallon of gasoline. The site fueleconomy.gov says the truck still costs more than $1,100 a year to run. To reiterate, Chevy and its fat cat cousins still have a long way to go!
In contrast to the more established car companies, Ronn Motor Company claims to be offering the future right now. The move to display the Scorpion in Monaco, when the company is really only learning how to walk, is a bold one, but not one taken without at least some sanction from back home. In March, Arnold Schwarzenegger, former action movie star and a bit of a car nut himself -- not to mention the governor of the union’s most populous state -- took the Scorpion for a spin, with company CEO Ronn Maxwell on the passenger side, and was quite impressed with what he said. ''The Terminator'' has been on a mission to kick-start the alternative fuel vehicle industry, and few appear better positioned to do so than RNNM.
The hydrogen hybrid Scorpion has already turned heads -- and hopes to do it again next month -- with what Maxwell calls ''its shapely curves, 200-mph plus top speed, 40-miles-to-the-gallon fuel economy and near zero emissions, a rare combination in the high performance supercar world.''
And the future for small-cap investors could also be right now; RNNM is still very much a bargain, its price below 50 cents a share, after flying around the $6 mark last June. It may be worth more than just a kick of the tires for North American investors to explore the stock before the 'ooh-la-las' reverberate from across the Atlantic next month.
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