Only two news items penetrated my vacation mindset this week. The more immediate one was Iran's release of the UK military personnel they were holding hostage, which ought to reduce oil price risk at least a little. I don't see the resolution of this crisis as quite as much of a victory for Iran as the pundits are proclaiming. However deftly Ahmadinejad and the mullahs may have outmaneuvered the UK, the reminders of an earlier hostage crisis will not enhance international confidence in the regime. It remains to be seen whether the dynamics of the nuclear controversy have changed.
The other item that caught my attention was a report on US auto sales, indicating that Detroit has lost more market share to Toyota and other imports, at least partly on the back of the growth of the Prius and other hybrids. At a 200,000 unit/year clip, the Prius looks successful as a car model, not just a technology platform or loss-leader. We're not far from the day when US auto firms sell less than half the cars in America, and the shift looks to have more to do with strategic mistakes than lingering concerns about quality. The Chrysler 300 rental car we just drove from Arizona to Southern California was as nice as any import in its class, and it averaged 27 mpg on the highway. But Detroit needs a dozen such hits, if it's going to recapture any lost ground, and it's not clear that GM has the vision to leverage its coming Chevrolet Volt plug-in hybrid in the same way that Toyota has done with the Prius.