Falling Dollar Reshapes Markets for Green Cars

I'm sure you've all heard of the sub-prime loan crisis and the falling U.S. dollar, but I bet you didn't know that it was trickling down to affect efficient vehicle choices for U.S. and European consumers.

In years gone by, smart automakers like Honda and Toyota anticipated fluctuations in international currency and decided to begin opening up factories around the world to cut distribution costs and stabilize profits. This is paying off right now, as neither company is taking a huge profit gouge due to the dollar being at record lows against the yen.

Other companies, like Audi, aren't quite so lucky. Because hybrids are generally low-volume and low-profit margin compared to standard sedans and SUVs, they are what is getting cut from Audi's 2009 plans, according to AutoBlogGreen. This isn't exactly surprising (who's going to have money for luxury hybrids in this economy, anyway?), but it's a bit worrisome. I really can't say if this suggests there will be more opposition to some of the smaller cars that have been projected for release in the U.S. after success in Japan and Europe, but I sure hope they make it across the pond.

In other, slightly related news, Tesla has announced that they will be selling their performance EV in Europe, despite issues with production volume (thanks to EcoGeek for reporting). With the Euro getting stronger and stronger compared to the dollar, this only makes sense from a business point of view. Tesla is also quick to make the point that high fuel prices and shorter commutes in Europe make the Roadster a good fit for the continent.

While I haven't heard any other announcements about product line up shifts due to the current currency (pun!) issues, it will be interesting to see how rising fuel prices, a dead-panned auto sales industry, and the falling dollar affect plans for fuel efficient cars around the world.