IBD Op-Ed - By Constantine Kambanis, Raghavan Mayur (Technometrica) and Bert Holland (AutoFuturesGroup)

The media have been sounding the death knell for Detroit's Big Three, and who can blame them? General Motors, Ford and Chrysler are struggling to cope with the lowest sales in decades amid rising gas prices and collapse of the SUV market.

But all is not doom and gloom. There's an upside here, though the nature of that upside may be surprising. Let's put it this way: Have you ever considered purchasing a Googleor Dell-branded automobile?

According to a new study by TechnoMetrica and Auto Futures Group, more than a third (34%) of Americans would consider buying a Google- or Dell-branded vehicle, assuming gas were to hit $6 per gallon and the vehicles were especially fuel-efficient.

Tata Group Chairman Ratan Tata poses with the world's cheapest car, the $2,500 Tata Nano, at its launch in January. A survey by IBD's polling partner, TechnoMetrica, found that 29% of Americans would consider buying a Tata or a car made by Chinese

manufacturer Chery if gasoline prices get to $6 a gallon. Even more would be likely to consider cars by General Electric (68%), Dell (48%) or Google (34%).

We can't speak directly to fuel efficiency, but we can speak to the $6-a-gallon figure. According to the survey, Americans expect to see gasoline reach an average price of $6.14 within the next three years.

If that comes to pass, the stage is set for new, non-automotive brands to enter the market.

Disruption is said to present big opportunities for those savvy enough to seize them, and the current marketplace is full of disruptive forces. Let's take a look at some of them.

On the consumer side, Americans no longer depend on what U.S. automakers offer from year to year. They're sophisticated consumers who do research before buying, are aware of the true cost of ownership and are cognizant of the fact that "American" no longer means better.

Americans are open to new possibilities. In addition to Dell- and Google-branded cars, they are also willing to consider vehicles made by General Electric, Chinese automaker Chery and Indian manufacturer Tata — if gasoline hits $6 a gallon. Americans' desire for change would not be limited to branding, however. They are ready for technological change as well. Thirty-eight percent say they would consider buying a plug-in hybrid and nearly half (46%) would be open to a battery electric vehicle if gasoline hits $6. At $8 a gallon, the percentages jump to 54% and 55%.

This is telling, especially considering that these technologies are not yet available on the open market. Talk about latent demand! Overcapacity and potential bankruptcies have lowered barriers for new players eager to enter the U.S. and global auto markets. Foreign brands seeking assembly capacity or even an American "face" (brand and dealer network) can potentially scoop up either. Just take a look at Tata for the playbook.

Suppliers have grown in both size and depth and are now the de facto technological gatekeepers, thanks to car manufacturers who for years pushed developmental responsibility off to suppliers. Now, desperate for new business, suppliers have every reason to assist new players wanting to enter the auto scene with know-how and attractive financials.

What's more, foreign sourcing has been suppressed in the car industry to protect local plants, suppliers and unions.

This represents an opportunity for non-automotive high-tech brands that have become experts at optimizing global sourcing and facilities to slash costs, and who are already on the forefront of rapid product development and short product cycles.

Who stands to make the most of Americans' new openness to non-automotive brands? Popular consumer brands that could capitalize on their high profiles. An Apple car might be chic, easy to use and unique; a Nike car high-performance and trendy; a Sony car compact, modern and well-made; a Gucci car a pure fashion statement; a GE car reliable and technically advanced; a Google car intuitive and connected; or a Dell car individualized to consumer specs.

Of course, the Japanese, as well as up-and-coming Asian and Indian car companies, are natural beneficiaries of Washington's new Corporate Average Fuel Economy increases and proposed metropolitan congestion pricing.

Clearly, the edge right now lies beyond Detroit's traditional forte. Unfortunately, Detroit now lacks both the image and the products to be convincing in a high fuel-price world. GM, Ford and Chrysler still have significant market share as well as market inertia — a

sound basis from which to launch re-makes.

But first, the triple burdens of health plans, pension plans and current infrastructures must be overcome. Then these companies must rapidly redefine themselves via technical and marketing alliances, global sourcing and more forward-thinking model policy.

Looking at the big picture, we believe the role of government should not be to "bail out" the American auto giants, but rather to provide a framework for renewal and growth via an intelligent and consistent energy policy and incentives for new technology.

No doubt, gasoline prices are profoundly reshaping the industry. The question is: How can we best rise to the challenge, and who is best positioned to take it on?

Kambanis is a senior analyst at and Mayur is president of TechnoMetrica Market Intelligence, IBD's polling partner. Holland is a senior partner with the Auto Futures Group.

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