Government to improve crash test program
The US government has decided to re-assess the New Car Assessment Program which began in 1979. Meeting were held with suppliers, automakers, and safety regulators. If the decision of putting in place new test programs is approved by the government then this will impact all suppliers, automakers and even consumers.
One effect that will be noticed is electronic stability control, which the government has proposed requiring on all new vehicles beginning in 2012. This decision will be very welcomed by the saftey advocates but what will it do to the price of new vehicles. If all standards must be met then it may affect the cost for suppliers and automakers to produce new vehicles.
This is when the question arises do Americans demand better quality cars or cheaper cars. In the long run it would be beneficial to demand the better quality car at a more expensive price but that is not how all consumers think.
In the article it states “We do know the program works and it’s clear that safety sells,” said NHTSA administrator Nicole Nason.
In the future demand for vehicles will be for the car with the best safety quality since standards are going up. What will this do for Americans that do not necessarily care for safety but rather the look and reputation of a car.
2 comments:
I'm sure that even if car companies start to produce higher quality cars at higher prices, there will still be producers making lower quality cars at lower prices. As long as there is a market and a demand for a certain type of car, there will be a producer willing to make it, so long as they can sell enough to produce a profit. In the long run, I think higher quality cars are worth the initial investment, but that is up to the individual consumer to decide.
If new safety regulations are set forth they will affect all automotive companies. All cars produced after a certain date will have to uphold these regulations. It will in fact cost the companies a great deal of money to restucture their production lines not to mention by different materials. It will take time for companies to design new cars along with these new regulations and adjust the old models. All of this will take resources, money and time...all which is costly in its own way. No matter what the cost of all cars will have to rise. The competition will be between the cars that will have to rise their prices the least.
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