Car buyers turn to Japan-again

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The math is simple. Gas costs $3 a gallon; Honda and Toyota have the best average MPG; DaimlerChrysler and Ford have the worst, with GM not much better. So Japan has added three points of market share year to date while Detroit has lost four. Now here's another domestic problem: Americans are counting on automotive innovation from Japan.

A survey fielded by Synovate for Advertising Age's American Demographics (see P. 8) found that 45% of adult respondents expect to be driving an alternative-fuel vehicle such as a hybrid within 10 years. A bigger share-47%-believe the biggest alt-fuel innovations will come from Japan. Detroit trails far behind, at 33%.

Every demographic group-age, income, education, region-gives Japan the edge in alt fuels, with one exception: adults with a high-school education or less, who put the U.S. marginally ahead.

To be sure, consumers may be extrapolating from the present. Toyota has invested heavily in building and promoting hybrids from the Prius to a Lexus SUV, so consumers may assume that gives Toyota and Japan the edge.

Maybe, as happened in the '80s, oil prices will tumble and stay depressed for years to come. That seems unlikely: The rise in oil prices has been fueled largely by growing long-term global demand, not constrained short-term supply.

The Big Three's share of retail sales this year has fallen below 50%; Toyota last month outsold Ford. This seems like the mid-'70s, when consumers flocked to thrifty Corollas and Accords while Detroit struggled to downsize.

Japan has no magic bullet. The average Japanese car, like the average American, has gotten fatter; a 2006 Accord weighs a half ton more than the original '76. Honda's MPG advantage over the Big Three has narrowed considerably since the '80s.

Detroit still could prevail on innovation, such as hydrogen fuel cells under development at GM and Ford. But Japan, with its deep fleet of hybrids and a new lineup of minicars, has the image of lean and green. For consumers, that makes Japan look like part of the solution. For Detroit, that's a problem.
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