Friday, April 22, 2005

China - the world's factory for cars as well

During the Shanghai Auto Show, DaimlerChrysler shocked the automotive world by announcing their intention to export small cars from China to the United States. This is just another step in China's direction towards becoming the world's factory. Auto parts have been manufactured in China since long, and the problems to compete with the west so far have just been the quality. Gradually the quality is increasing and is currently on par with Korea and rising.

China's Commerce Ministry is forecasting the automotive exports, which mainly consists of auto parts today, to increase from $11.8 billion last year to between $70 and $100 billion by 2010.

If we haven't done our scenario work about how the world will look like when China steps forward, it is about time now!

The main problem today is that our institutions are almost completely unable to think about decline. TV-program after TV-program is reporting on the effects of the business tsunami created by WalMart and others... but who is building the structures that will come after? If it is necessary for the old organizations to die and for others to rise from the ashes, who is creating the new frameworks and mindsets for them?

International Herald Tribune - China on brink of cracking car market

Thursday, April 14, 2005

Consequences for US after the oil peak

Since most of the countries in Europe have experienced several oil crisis, we think we know what it is all about. And maybe we are right, but all the previous oil crisis situations have been temporary. The coming one is not temporary but one that will prevail - it is a permanent situation. The solution is not to hide and bunker, but to change to other sources of energy and as fast as possible change our patterns of behaviour to a more sustainable way.

For Americans this issue could turn out to be much more interesting, or should I say, stressing. What is happening in an oil crisis situation in a country which does not have a decent railroad system. Most people and businesses rely on cars, trucks and aeroplanes. How will this affect the big cities which rely heavily och trucks for the food supply. What is happening on the national security scene with a country which has been going to war several times since to 1970:s mainly to protect their oil supply?

James Howard Kunstle has written a book by the name The Long Emergency which have been adapted to an article in The RollingStone where he discuss the consequences for the American society. It is an interesting and sometimes frightening reading. This is quote from the beginning of the article:
Carl Jung, one of the fathers of psychology, famously remarked that "people cannot stand too much reality." What you're about to read may challenge your assumptions about the kind of world we live in, and especially the kind of world into which events are propelling us. We are in for a rough ride through uncharted territory.

Read the article

Saturday, April 09, 2005

IMF - Oil price will remain high

In a recent report IMF acknowledges that the Oil price will remain high. The IMF report doesn't however seem to acknowledge the uncertainty that China's oil consumption will grow exponentially when certain income levels are met (see my blog: Criticial Uncertainties in the Oil forecasts.

In the report IMF are forecasting a sustained oil price at levels between $69 and $97 in 2030. The message to the world is of course to adjust to these new levels.

One of the really big question marks is how and when George W. Bush will react and what measures he will take. In a critical article in NY Times (free registration required> Thomas L. Friedman asks the relevant question:

How will future historians explain it? How will they possibly explain why President George W. Bush decided to ignore the energy crisis staring us in the face and chose instead to spend all his electoral capital on a futile effort to undo the New Deal, by partially privatizing Social Security? We are, quite simply, witnessing one of the greatest examples of misplaced priorities in the history of the U.S. presidency.

This article spread quickly in the world, which only underscores it's relevance.

Will the IMF report be a mile stone in the process to change the American mindset towards a new relation to oil?

Read about the report in an article in International Herald Tribune.