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Peter Maass on 'The Breaking Point' for Gas Demand

Peter Maass, a New York Times Magazine contributing writer, traveled to Saudi Arabia, the world's largest oil exporter, to examine its oil reserves and Saudi government claims it can keep up with demand for 30 to 50 years. Maass discusses the political, financial and environmental implications.


Other segments from the episode on August 22, 2005

Fresh Air with Terry Gross, August 22, 2005: interview with Peter Maass; Commentary on Mott The Hoople.


TIME 12:00 Noon-1:00 PM AUDIENCE N/A

Interview: Peter Maass discusses his article on the future of oil

This is FRESH AIR. I'm Terry Gross.

Paying for a tank of gas has become a sobering experience, and it's a good
reason to think more seriously about the future of oil. We rely on Saudi
Arabia to keep pumping as much as we need, but some experts think that the
Saudis might be reaching their peak and prove unable to keep up with the
growing international demand. My guest Peter Maass is writing a book about
how oil shapes global politics and the world economy. He recently visited
Saudi Arabia. His article about Saudi oil titled "The Breaking Point" was
published in yesterday's New York Times Magazine. He's a contributing writer
for the magazine.

What questions did you set out to answer by doing this piece?

Mr. PETER MAASS (Contributing Writer, The New York Times Magazine): I went to
Saudi Arabia to find out, really, how much oil Saudi Arabia has and how much
it can produce on a daily level because if you can find those answers, then
you have a much better idea of whether or not--and this is kind of the big
question--whether or not in the years ahead Saudi Arabia, which is the largest
oil producer, will be able to supply not just America but the rest of the
world with enough oil to satisfy their demands on a daily basis. And there's
a lot of questioning now about whether or not, in fact, Saudi Arabia can do

GROSS: And how does the ability of the Saudis to keep up with the demand for
oil--how does that affect prices?

Mr. MAASS: It affects prices directly because the Saudis possess about 25
percent of the world's known oil reserves. And they've always been kind of
the central bank of oil in the sense of whenever the world needed more oil,
all they did is just kind of flip a few switches and more oil came out of
their wells and went into the cars of American and European consumers and
factories all over the world. And so if they can't continue increasing the
amounts of oil that they produce on a daily basis, then that means there won't
be enough for the world and that the price of oil, as a result--when you have
kind of a shortfall between demand and supply--is going to go up because the
demand keeps on increasing.

GROSS: When the Bush administration makes its projections for the future and
what our needs will be and whether Saudis will be able to meet those needs,
what are they expecting the Saudis to be able to produce in the way of oil?
What are the projections that the American government is making?

Mr. MAASS: In a general sense, the American government has always projected
that Saudi Arabia will be able to produce as much oil as America requires.
And, in fact, the Saudis have always said that they would be able to produce
as much oil as America and its other clients require. Right now Saudi Arabia
produces about 9.5 million barrels of oil a day. They're promising to
increase their daily capacity to about 12.5 million barrels a day by the year
2009. Most people think that they probably can do that; that they can
increase production to that level.

The real problem is that 12.5 million barrels a day is kind of just a mark
that's going to be passed in the next couple of years on an upward continuum.
And the United States government has these kind of forecasts for the year
2015, for the year 2025 in which Saudi Arabia is kind of slotted in to
produce, you know, 15 million barrels of oil a day and then up to 20, 21
million barrels of oil a day. And the problem is that most kind of
responsible, knowledgeable oil experts, including some in Saudi that I talked
to, say that for Saudi Arabia to produce 15 million barrels a day would really
be quite taxing and may not be possible and anything above that, probably at
the current moment with the technology that exists, is not possible at all.

GROSS: So you've sampled different opinions about what Saudis are capable of
producing and how long they'll be able to keep up with need. And you found
that it's actually really hard to get real answers to that question, and one
has to do with it's difficult to tell how much is really in oil reserves, but
the other is secrecy. Where did you run into the secrecy?

Mr. MAASS: I ran smack into the secrecy when I went to Saudi Arabia. I was
able to get a visa to go there, which was, you know, a minor triumph. But
once I was there, I had hoped to interview officials in the Oil Ministry,
including the minister himself, and then officials in Saudi Aramco, which is
the state-owned oil company. In the end, in fact, all of my interview
requests were denied by the Ministry of Oil. Nobody in the Ministry of Oil,
aside from the spokesman, who very reluctantly agreed to speak to me for a
very short while--really, it was pretty much of an information blockade from
the Saudis because they have become incredibly sensitive to the questioning of
how much oil they can produce.

I mean, they see it, on the one hand, as being kind of a challenge to their
status as the central bank of oil, and they also kind of have followed a
policy, as have really all of the oil producers, of not letting people know
exactly what they have underground, what they are producing on a daily basis.
They issue general numbers, but if you ask for the kind of information,
seismological information, geological information, how much each well is
producing, how much particular wells and particular fields are declining
'cause they all decline over time, what kinds of methods are being used to
recover the oil because you can kind of tell by the types of methods that have
been used how healthy a reservoir is--all of these kinds of details, which are
absolutely necessary to really understanding how big reservoirs are and how
long they can continue going on producing oil--all of these details are
basically the equivalent of state secrets in Saudi Arabia, as they are in,
basically, all OPEC countries and among virtually all state-owned oil
companies in the world.

GROSS: There's an expression called `peaking' that's very important to what
we're talking about. What does that mean?

Mr. MAASS: `Peak oil' is kind of a phrase that you're hearing more and more
in the oil world. And what it basically means--and this is kind of crucial to
understanding why there's so many questions about Saudi Arabia and, indeed,
other oil producers--what it means is that basically when a country's reserves
or any particular reservoir are about half depleted, what happens is--even
though there's still 50 percent of the oil underground that remains there,
what happens is that you can no longer continue, for geological reasons
basically--you can no longer continue increasing the amount that you extract
from the reservoir because oil reservoirs are not like kind of, you know,
lakes of oil underground with which these wells are like straws that you suck
the oil out of. In fact, oil really exists as little drops between and within
porous rocks. It's extremely difficult actually to extract from these

And when you reach this halfway point, there's about roughly half of the oil
out of a particular reservoir, at that point--and this is where this phrase
peak oil comes in--you're no longer going to be able to keep continue
increasing the amount of oil on a daily basis that you produce from this
reservoir. And the kind of question that exists right now--and there are a
number of people who suggest this, including a Houston energy banker named
Matt Simmons--the question really is: Have Saudi Arabia's reservoirs peaked?
Are they just about at the point where they can no longer produce increasing
amounts of oil? And there's real kind of reason to at least look into it, if
not believe that.

GROSS: And Matthew Simmons, who you just referred to--he's the head of a
company that advises energy companies on mergers and acquisitions. And what
is he projecting about when the Saudi oil is going to peak?

Mr. MAASS: Well, Matt Simmons suggests in this new book that he just
published that, basically, Saudi Arabia is probably peaking right now. And
Matt Simmons--it's quite an interesting situation because he is--you know,
he's not some kind of wild environmentalist or kind of rogue economist or
anything like that. I mean, he is part of kind of the ruling class of the oil
world. He's an energy banker in Houston, very prosperous. And he went to
Saudi Arabia in 2003 on a government-sponsored tour, the kind of thing that
the Saudi government throws all the time for investors and bankers. And
instead of actually coming out of that visit really impressed with the Saudi
oil industry, he had questions, and he couldn't get them answered by the
Saudis or anybody, really.

And so what he did is he looked into kind of these files that exist of kind of
technological papers that have been written about some of the Saudi oil
fields that nobody really paid any attention to. And he examined these, about
200 papers, about the Saudi oil fields. He examined them, and he kind of came
to the conclusion that, in fact, these fields are not in nearly as good health
as the Saudis say. And he came out with the conclusion that the Saudis have
attacked quite strongly that, in fact, Saudi Arabia is peaking right now. And
because Saudi Arabia is peaking, that means basically the world is probably at
its peak because Saudi Arabia, with a quarter of the world's oil reserves,
pretty much determines where everything else is going as well.

GROSS: So you've got one oil expert saying that Saudi oil's already peaked.
You've got another, who used to be highly placed in the state Saudi company
Aramco saying, `Hasn't peaked yet but likely will soon.' And then you've got
the Saudis themselves, the officials, saying, `Oh, no, everything's great.'
So where--how do you decide where the truth lies?

Mr. MAASS: Well, you've got to look, you know, as with kind of, you know, all
matters, whether economic or political, at what kind of the interests and
incentives are of each side to maybe, you know, color their conclusions or
their public statements. And the Saudis are in a real bind because let's say,
for example, that, indeed, there are limits to what they can produce. If they
just all of a sudden announced to the world, `You know what, guys? We're not
going to be able to produce more than 12.5 million barrels a day. You're
going to have to develop alterative energy sources. You're going to have to
start conserving energy,' then two things are likely to happen, at least in
the immediate term. One is that the price of oil, which is already quite
high, will skyrocket even more. And the second--and for the Saudis, more
troubling kind of result--would be that, indeed, there would be movements in
America and elsewhere towards alternative fuels, government programs to
investigate, to promote them. There would be movement towards conservation of

And the result of that, not immediately but, you know, five, 10, 15 years down
the road, is that there very well, indeed, might be alternatives to oil. And
the Saudis, who, you know, depend on income from oil to keep their country and
their economy afloat, may no longer have this valuable resource that can't be
replaced because there may be replacements for it. So they don't want to kind
of kill the goose that lays the golden egg by telling people, `Hey, the golden
egg may no longer be there in a couple of years.'

GROSS: My guest is Peter Maass. His article about Saudi oil was published in
yesterday's New York Times Magazine. We'll talk more after a break. This is

(Soundbite of music)

GROSS: My guest is Peter Maass. He's writing a book about how oil shapes
global politics and the world economy. His article about Saudi Arabia oil and
whether it can keep meeting our demands was published in yesterday's New York
Times Magazine.

You say it might take 10 years to prepare for a time when oil demand exceeds
oil output. Congress just passed a new energy bill. What does that bill set
in motion to help prepare for oil problems in the future?

Mr. MAASS: Most of the people who I've talked to about the energy bill and
how well it kind of begins to prepare us for the future tend to agree that the
energy bill, really, does very little to prepare America for a future in which
there might be shortages of oil because, really, there are kind of two key
things that need to happen, pretty much everyone that I've talked to agrees
on, which is that there needs to be more conservation in the way that we
consume oil, and there also needs to be more development--and, really,
assertive development--of alternative fuels. You know, of course, there are
alternatives that exist, but they haven't been proven yet to be economically
viable, or if they have become proven to be economically viable, they haven't
been scaled out to the size that's necessary for them to play a major role.

And the energy bill really doesn't go very far on that. On just the issue of,
for example, conservation, really, you know, everybody who you would talk to
in the energy world agrees that one of the key things that America needs to do
is increase the fuel efficiency of its automobile fleet. And the one thing
that is actually lacking from the energy bill that was just signed by the
president is a mandated increase in the fuel efficiency standards for American
cars. That was one measure that everybody was saying, `Look, you know, it
would make a great amount of sense to do'--does not exist in the energy bill.

Another kind of, you know, reform that a lot of people think is necessary,
which would be very painful for Americans, is that the price of gasoline needs
to rise in order to, indeed, know, promote conservation by virtue of taxes on
gasoline, greater taxes than exist now. Americans pay maybe half of what
Europeans pay for taxes for gasoline. You know, a gasoline tax is something
that really is, you know, one of the many third rails that exist in American
politics. In the presidential campaign in 2004, President Bush accused John
Kerry of being in favor of gasoline taxes. You know, Kerry was not in favor
of gasoline taxes during his campaign at all, even though, you know, many
people say that's exactly the kind of hard medicine that America needs to
begin to swallow.

GROSS: How could a gasoline tax help conserve energy?

Mr. MAASS: Well, a gasoline tax has a very straightforward effect on energy
conservation. If you make gasoline more expensive for people to consume,
they're going to probably consume less of it. You know, already at nearly $3
a gallon in some places, gasoline is quite expensive. If you, you know, slap
an additional tax on it, it's going to become more expensive, and people will
drive less. That's going to make their lives a little bit more difficult,
particularly for people who really rely on their cars--if you live in the
suburbs, if you're a trucker, things of that sort. It's very painful. But
it's also something that would lead to greater conservation, and that's why
there's a fair number of people who think that's something that should be

But it is, indeed, extremely difficult for any politician in America to really
aggressively promote it because, you know, one of the last people who did
aggressively promote conservation measures, and painful ones, for this country
was Jimmy Carter, who called for the moral equivalent of war in order to make
America free of the dependence for oil from foreign sources. And, of course,
we all know what happened to him; he was not re-elected. There were many
reasons why he was not re-elected, but a large number of people do believe
that some of the reasons he was not elected was because, indeed, he was
calling for national sacrifice in the way of energy conservation that people
just did not want to have in their lives.

GROSS: When President Bush talks about our oil future, he talks about the
need to drill in the Alaska National Wildlife Refuge. What--how much would
that add to the oil that we have access to?

Mr. MAASS: The Alaskan Wildlife Refuge has--nobody knows exactly, but rough
figure that people agree on is about 10 billion barrels of oil, not
insignificant. But when you compare it, for example, to Saudi Arabia, which
has reserves of about 260 billion barrels of oil, it's pretty small stuff.
Now because it's unlikely that vast, new reservoirs of oil are going to be
found anywhere in the world, reservoirs that contain 10 billion barrels of oil
are going to have to be part of the solution--interim solution. If you need
more oil and, you know, there are only little 10-billion-barrel fields here or
there, most people will say, `Well, then that's what you've got to go with,'
you know. Now, of course, the 10 billion barrels that we're talking about are
in Alaska. They're in a wildlife refuge. And there are very good reasons to
not drill there.

One of the things that some people have pointed out to me--and I've traveled
around and visited a lot of oil sites in Africa and elsewhere--is that there
are a lot of nice tracts of land in Amazon countries, in Ecuador and Brazil;
in, you know, African countries that I've been to, in Nigeria, the Niger
Delta, which used to be just an amazing, amazing source of wildlife, that have
been and are being affected quite severely. And, you know, one of the kinds
of interesting and less-talked-about aspects of the debate about, you know,
Alaskan Wildlife Refuge is if we don't get the 10 billion barrels of oil from
there, it's going to come from somewhere else. And in some respects you're
kind of exporting the problem or outsourcing the environmental problem because
there are very few places on the planet, where oil exploration is conducted,
where there is not environmental damage of, in many cases, environments that
are quite precious. And so, you know, personally I just wish people kind of
understood that a bit more.

GROSS: I know a lot of people wonder: Do the high prices of gas and oil
today have anything to do with the war in Iraq? Is there any evidence that
there's a connection between the two?

Mr. MAASS: Oh, well, there's definitely a connection between the two because,
you know, one of the hopes in terms of the affects of the war in Iraq, the
invasion of Iraq, would be that after Saddam was thrown out, there would be a
lot of investment in the Iraqi oil industry--and Iraq has something like 110
billion barrels of oil underground--and Iraqi oil production would just, you
know, double or triple or something like that. If that had been the case,
maybe we'd be in a slightly--or we should be in a slightly better situation
right now in terms of the amount of oil that would be available and the price.

But because that's not the case--because, in fact, after the overthrow of
Saddam Hussein, the production of oil in Iraq, you know, kind of has just been
limping along and hasn't really returned to its previous levels, let alone
kind of increasing above them--we're in the situation now where, you know,
there's a shortage and where Iraq is, in some respects, part of the problem in
the sense of not being able to produce the amount of oil that the rest of the
world wants. And nobody thinks that that's going to chance anytime soon.
It--you know, even if tomorrow Iraq turned into a peaceful country, where
there could be kind of productive investment and new exploration, it would be
years and years before any of that would result in, really, greatly added
amounts of oil coming out of the ground.

It takes, you know, projects in the oil industry to--kind of from start to
finish, from when you start drilling to when you actually get oil out of the
ground and send it through pipelines--those are usually projects that take
years and years and, you know, billions and billions of dollars.

GROSS: What kind of national conversation do you think we need to be having
about the future of oil, the future of our oil use?

Mr. MAASS: I think the conservation that needs to happen needs to focus on
the fact that the time when the amount of oil that we're going to need on a
daily basis very likely will not be available. We need to focus on that issue
and know that in order to prepare for that moment, we probably have to start
now because developing and scaling out alternative energy sources, whether
they are environmentally friendly--you know, solar power, wind power,
whatever--or whether they're not environmentally friendly--nuclear power--the
scaling out needs to begin now because even at this point when there's not
enough oil on a daily basis to supply our increase in demand--even if this is
15 years off, it's going to take 15 years to prepare for that.

And if we don't prepare for that, we're going to be facing an incredibly
painful time, where the situation that prevailed in 1973, when there was a
boycott by the Arab members of OPEC--that situation, painful as it was, will
probably seem like, you know, a mere pinch compared to what would happen if
there were not enough oil, not just for a temporary period of time but for
time until there's no more oil left at all. We probably need to begin
preparing for that now.

GROSS: Peter Maass, thank you very much for talking with us.

Mr. MAASS: Thank you.

GROSS: Peter Maass' article about Saudi oil was published in yesterday's New
York Times Magazine. He's writing a book about oil. I'm Terry Gross, and
this is FRESH AIR.

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Interview: Mark Phelan discusses current trends in autos and
his 20 years writing about the auto industry

This is FRESH AIR. I'm Terry Gross.

Summer vacation season is driving season, and gas guzzlers have been guzzling
money at the pump. The price of gas may be changing the priorities of people
shopping for a new car. We invited Mark Phelan to talk with us about the
latest developments in fuel efficiency and in car design. Phelan is the auto
critic for the Detroit Free Press. He's covered the auto industry for various
publications for about 20 years.

Is there any one thing that you would point to as the most interesting
development in the auto world now?

Mr. MARK PHELAN (Auto Critic, Detroit Free Press): Well, from my point of
view, it's the return of the love affair with the American car. And I don't
mean American in the sense of where it is manufactured but sort of the classic
formula for what kind of car Americans liked, something with a lot of room
with a big engine and a reasonable price. And the perfect example of that at
the moment is the Chrysler 300, which hit the market last year and took it by

And it is--in a lot of ways, it has all of the latest technology to give it
good fuel efficiency and to make it very practical and reliable. But it
combines all of those things with the virtues of the old American cars in that
it is very affordable and it's got more room and more power and, in many ways,
more style than anything that you can buy for a comparable price. And you see
now Ford catching on with some of the, you know, same buzz with the Mustang
that they introduced, which goes back to a formula that's been successful for
them in the past. And it appears that GM is moving in that direction as well.

GROSS: I'm told that the new Mustang was designed with Steve McQueen from the
Bullitt era in mind.

Mr. PHELAN: It was, and it's incredibly successful. The first time that I
drove the Mustang, I walked up to it with no particular sense of anticipation
because I thought I knew what a Mustang was, and I didn't think it could
surprise me. And I got about five feet away from the car, and I saw a
reflection in the windshield, and I would have sworn it was Steve McQueen.
They absolutely nailed it.

GROSS: (Laughs) Well, let's look at how the hybrids are performing. Now how
long have they been on the market? Like, how much of a track record do they
have so far?

Mr. PHELAN: The first one went on sale in the United States about five years
ago, and the numbers so far have been small. I believe last year all of the
hybrids put together sold about 60,000. The people who have bought them have
been absolutely delighted with them. And there's no question that they do
provide a significant increase in fuel economy compared to a similar vehicle
that has a gasoline engine without the electric power plant.

The technology is moving into some other parts of the market now. And I'm
going to be very interested to see how that works because small cars, like the
Toyota Prius, which is the poster child for hybrids, as well as being fuel
efficient, they make a statement when you see them. And a lot of the people,
I believe, you know, who were buying them liked it for the aura that went with
it; that, you know, they are doing something, you know, good.

Now companies are trying to put hybrids into more mainstream vehicles, SUVs
and midsized sedans. And I'm going to be fascinated to see if that more
bread-and-butter part of the market is also willing to pay the extra, you
know, 3 or $4,000 that the system costs because so far while the fuel economy
is a great improvement compared to a straight gasoline engine, even at today's
high gas prices you're not going to recoup the expense of the hybrid system
over the ownership period. So there's got to be an element of social
consciousness as well as economics for people to, I think, get their money's
worth out of a hybrid.

GROSS: So you've done a lot of test driving of the hybrids. I know in one of
your columns you talked about sometimes to get the maximum mileage out of a
hybrid, you have to change some of your driving habits. What habits do you
have to change?

Mr. PHELAN: Well, you have to do many of the same things you would to improve
fuel economy in any car. You have to accelerate slowly and carefully. You
have to decelerate early; just take your foot off the accelerator well before
you need to if you're just going to be coming up to a stoplight and breaking.
And with hybrids in particular, learning a light touch on the gas pedal allows
the electric motor to move the car without the gasoline engine being involved
at all. And figuring out just the right way to use, you know, the gas pedal
is very important. And the owners, especially the early owners, of the
hybrids take great pride in doing that and in the fuel economy that they get.
And if you change your habits in all those fashions, you really can get some,
you know, pretty astounding fuel economy out of them.

GROSS: Meanwhile, the Bush administration is expected to give up its proposal
to extend fuel economy regulations to Hummers and other cars in that category.
What's the story behind this?

Mr. PHELAN: Oh, that's a great little loophole. It got its origin back when
fuel economy rules were first being put out, and there were no SUVs that
people used just to drive around town that weighed, you know, 8,500 pounds or
more, which is what you're talking about when you get into the size of a
Hummer. The only vehicles that size then were big commercial vehicles and,
you know, things that farmers would use to, you know, haul hay, you know, to
the barn, you know, things that were purely used for business purposes. And
they didn't want to penalize those people. But as SUVs got bigger and as
people developed a taste for things like Hummers, these mega SUVs came along.
And it just so happens that they're so big that they fall outside of the area
that the EPA even tests for fuel economy. And that is a substantial benefit
to them, and it looks like they're not going to be losing it.

GROSS: Let's look at the other end. What's happening with the minicars?

Mr. PHELAN: You know, it's amazing. The conventional wisdom for years was
that you couldn't sell tiny cars in America. And Mini came out with the Mini
Cooper, and they're selling every one they can build. Toyota launched a line
of, you know, very small cars called Scion. They're selling very well. And
the unifying thing about all of these small cars is that they're good-looking,
they're inexpensive and the people who buy them are getting a full package
that offers them all of the comfort and all of the safety features that they
would get in a larger car at an affordable price.

GROSS: Well, what kind of safety features are there in a minicar especially?

Mr. PHELAN: Well, the...

GROSS: You're likely to feel more vulnerable in a smaller,
lower-to-the-ground car.

Mr. PHELAN: Yes. The Mini Cooper, for instance, they're very proud to point
out that it's 11 feet long and it has 12 air bags in it. It's the only
vehicle on the road that's got more air bags than feet of length. And all of
the small cars are being designed with anti-lock breaks, with stability
control which helps in slippery conditions. Air bags are becoming ubiquitous
on virtually all vehicles. And the science of designing the structure of the
cars has become much better so that even if you are in a very small,
relatively light car, you've got a better safety cage around you than you
would have if you were in, you know, an old VW Beetle or, you know, one of the
early compact cars that were sold.

GROSS: What are some of the innovations in the actual driving systems of cars
that might be filtering down to, you know, most of us consumers sometime in
the near future?

Mr. PHELAN: There are several very, very significant ones. The best one
that I've come across in the last 10 years at least is what they call
electronic stability control which senses how each of the wheels are doing and
essentially makes it impossible for you to slide off the road if you hit an
icy patch. It's just a miraculous system. And I think you're going to see
that working its way into cars throughout, you know, the price range.

Another real interesting thing that is affecting fuel economy in a good way is
that companies are figuring out how to shut off a part of an engine when the
car doesn't require all of the power from it. You know, the V-8 in the
Chrysler 300, for instance, if you're cruising on the highway, you know, at 65
miles an hour, it shuts down four cylinders so that you're effectively driving
a car with half the size engine, and that improves fuel economy ratings by
something on the order of 20 percent if I remember correctly. That kind of
thing is going to be moving into SUVs in the near future and the car companies
hope that that will address some of the fuel economy concerns there.

GROSS: My guest is Mark Phelan, the auto critic for the Detroit Free Press.
We'll talk more after a break. This is FRESH AIR.

(Soundbite of music)

GROSS: If you're just joining us, my guest is Mark Phelan and he's the auto
critic for the Detroit Free Press. He's covered the auto industry for various
publications for about 20 years.

We were talking earlier about the new hybrids and new SUV hybrids. In Europe,
diesel-powered cars are very popular and of course diesel fuel is a lot
cheaper than the gas that we use. How come they've caught on in Europe and
never really caught on here?

Mr. PHELAN: Largely because Europe has always had a tax system that favors
diesel. I mean, gasoline is so much more expensive in Europe than it is here.
And while diesel is expensive, it'll cost you, you know, $1.00 or $1.50 less a
gallon in some countries in Europe, so that's a very significant incentive.
And there's also the fact that back during the fuel crises, you know, of the
'80s, Ford and General Motors tried to get into the diesel business with their
cars here and they built some incredibly bad engines with poor reliability,
terrible performance, and they pretty much ruined the name of diesels with the
general American public.

GROSS: So you don't think diesels will ever be catching on here?

Mr. PHELAN: Well, I think actually that was long enough ago that there's a
new generation that doesn't remember any of those miserable old cars that, you
know, broke down and smoked on the side of the road. And the new diesel
technology that they've developed in Europe provides excellent power and very
good fuel economy at the same time. And there's a small loyal audience for
that technology here in the States. It's a question of whether it crosses the
gap to the mainstream. The first potential test of that is the Jeep Liberty,
which added a diesel model this year. And they had planned if I recall
correctly to sell 5,000 of them by the end of the year. And the last I saw,
they had sold 9,000 in the first three or four months and people are lined up
to buy more of them. So there does appear to be some audience for it, it's
just a question of, you know, how large it will become.

GROSS: There's something called biodiesel cars.

Mr. PHELAN: Yes.

GROSS: What's the biodiesel?

Mr. PHELAN: It's diesel fuel that is made from renewable organic sources.
Generally, it could be soybeans, it could be corn, it could be almost
anything. And every Jeep Liberty diesel that rolls off the assembly line is
filled up with a tank of biodiesel. There's no petroleum products involved
anywhere in the process, so it's something that is one of the alternatives
people are looking at as a way to reduce dependence on oil.

GROSS: What's the upside and downside of this natural diesel fuel?

Mr. PHELAN: Well, the upside is that you don't have to, you now, worry
about, you know, where oil comes from and all of the environmental, you know,
problems that are inherent in producing oil. The downside is essentially
cost. It is a little bit more expensive to produce the biodiesel than it is
to, you know, drag it up from the ground and distill oil. But it's an
intriguing move and, in fact, in Europe there are some countries that are
moving towards very significant incentives for people to use other vehicles
that have got biofuel. Sweden is just moving into a huge push for ethanol
fueled vehicles.

GROSS: Don't a lot of cars now look exactly the same?

Mr. PHELAN: Yes.

GROSS: You know, just the styling of them on the outside, it's--I'm not a
real, you know, car afficionado but I often find it hard to tell one car from
another. It's hard to tell a cheap car from an expensive car. They're all
kind of similar.

Mr. PHELAN: You're not the only one.

GROSS: Not all of them, but a lot of them.

Mr. PHELAN: No, there are a lot of them. They became a commodity and that's
one of the biggest problems that the traditional American car companies had.
They were so far behind the pace on fuel economy and reliability that they
mistook reliability for blandness and we got a generation of pretty bland
looking cars. And all of the car companies now--you see this, you know, both
at the American companies and the major Japanese players--Toyota and Honda in
particular. All of them are working to find a way to make more distinctive,
more stylish cars that you can recognize, you know, at a hundred yards away
and know exactly what it is because once quality ceases to become the
determining factor for people when they're buying, then style and emotion come
into play. And these companies forgot that they were in the emotion business
for a while.

GROSS: You've been covering the auto industry for about 20 years. What are
some of the most interesting changes you've seen in that time?

Mr. PHELAN: The most fascinating thing of all to me has been that for most
of 20 years the traditional American Big Three were working incredibly hard to
squander the loyalty that they had built up among their customers for the 60
or 70 years before that. And, you know, they were building cars that did not
have much appeal, that were not competitive, you know, on price or quality.
And the thing that has amazed me is that over the last four or five years as
brands like Cadillac and Chrysler have come out with vehicles that have the
looks and the substance that consumers have run back to them eagerly. I
would have never have guessed that there would be that big a reservoir of
goodwill for these brands.

There's also the incredible growth in the truck side of the business. In
mean, 20 years ago, a truck was a pickup and you drove a pickup if you were a
farmer, a plumber, a carpenter. Today, a truck is everything from a little
$14,000 pickup to an $80,000 Mercedes SUV and people in every imaginable walk
of life drive them. And they think of them as their car. They don't make the
distinction between a truck and a car the way people used to. It's all one
market as far as they're concerned. They're looking for the function that
they want and the labels have ceased to matter very much.

GROSS: Is this a good time of year to buy a new car?

Mr. PHELAN: I would say the best time is the dead of winter.


Mr. PHELAN: Because December and January nobody wants to be out walking in
the parking lot at a dealership if you live in the northern, you know,
two-thirds of the country. It's just a miserable time to be, you know,
shopping for a car. And the car dealer's business is much slower then--and
particularly in December, every car company has got sales targets that they
set for the year. And if they're 10,000 units short, they'll do whatever it
takes to get that 10,000 sold. So December is when, a lot of times, you will
see really good deals because some manager has to reach the goal that he set
himself at the beginning of the year. This is a good time, but because of the
incredible success that the employee discounts have had over the last two
years, August would traditionally be the time when there's a lot of the
previous model year sitting around and they'd want to move those out. But
inventories are so low right now that it's difficult in a lot of cases to find
the car that you want because they sold everything over the last six weeks.

GROSS: How successful have the employee discounts been and what's the
reaction been among actual employees because they were no longer getting a
special benefit by being an employee of a car company?

Mr. PHELAN: They've been successful, I think, beyond anybody's wildest
dreams. And most of the employees, I think, are smart enough to realize that,
in the long run, it's better for them if a company sells more cars even if
everybody gets the same deal that used to be just specially for them.

GROSS: Mike Phelan, thank you very much for talking with us.

Mr. PHELAN: You're welcome, Terry.

GROSS: Mark Phelan is the auto critic for the Detroit Free Press.

This is FRESH AIR.

* * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

Profile: Mott The Hoople, a bright spot on the otherwise dismal
1970s rock music scene

Rock historian Ed Ward says that for a lot of people Mott The Hoople was one
of the bands that made the early '70s bearable. Ian Hunter's self-conscious
but knowing songs about the rock 'n' roll life and the group's almost
self-mocking stage presence were rare fun in the days of serious progressive

(Soundbite of music)

Unidentified Singer: I changed my name in search of fame to find the Midas
touch. Oh, I wish I'd never wanted then what I want now twice as much. We
crossed the mighty oceans and we had a few divides but we never crossed
emotion till we found too much inside. You know all the tales we tell. You
know the band so well. Still I feel somehow we let you down.

ED WARD reporting:

Once upon a time in the mid '60s, there was a bunch of English guys with a
band called the Doc Thomas Group who went to Italy in search of fame and
fortune, playing around and even getting to make a record there. They sounded
like this.

(Soundbite of music)

Unidentified Singer: Everybody, get on your feet. You make me nervous when
you're in your seats. Take off you shoes and tap your feet. We're doing a
dance that can't be beat. We're barefootin'. We're barefootin'. We're
barefootin'. We're barefootin'. Went to a party the other night.

WARD: Italy, though, wasn't a great place to get rich or even to get paid.
So the band returned to England, changed their name to Silence and recorded a
demo, which they sent to producer Guy Stevens at Island Records. Stevens
offered them a contract but told them their lead singer, Stan Tippens, wasn't
rock star material. So they placed an ad in Melody Maker, and after
auditioning a few no-hopers, they tried a friend of the guy in whose studio
they were recording.

Ian Hunter Patterson had been a journalist, a factory worker and had played
with dozens of bands in England and Hamburg who wasn't too keen on auditioning
for Silence. In fact, he'd never heard of Island Records, at the time one of
England's most successful labels, but he did it as a favor to his friend. On
the way, he bought a pair of cheap sunglasses to hide what he felt was his fat
face. Guy Stevens loved him. The other guys, except for Stan Tippens, were
afraid of him. But he was hired and now all the band needed was a name.
Somehow Stevens came up with the Mott The Hoople, the title of an obscure
novel by American writer Willard Manus. Next, they went into the studio.

(Soundbite of music)

Mr. IAN HUNTER PATTERSON: (Singing) Leaving me girl and moving on down the
road. You left me many burdens such a heavy load. And it sure does bring me
out when I think about what went down. Well, the crossroads all my life it
has been. And I'm so afraid but now I'm tryin' to see. I just rode on
through life...

WARD: Guy Stevens, their producer, was a man of very definite opinions. He
decided that Mott The Hoople was going to be his Dylan band. Certainly Ian
Hunter--he dropped his last name--sounded like Dylan, enough so as to confuse
people, who in 1969 when Mott's first album came out were eagerly waiting to
hear what Dylan was up to. A band covering Doug Sahm's "Crossroads" and Sonny
Bono's "Laugh At Me" in Dylan-esque style was sure to be noticed.

But the other thing about Guy Stevens was that he had serious alcohol and drug
problems and so the band demanded to make their second album without him. It
flopped. So Island imposed Stevens on them for the next two albums, which
sounded terrible and also flopped, although they were beginning to get a
following in the States. Finally, in March 1972 in Zurich, Mott was arguing
so much they agreed to break up.

Their bassist, Overend Watts, had heard David Bowie needed a bassist and went
to audition. Bowie was horrified. One of his favorite groups had split and
he'd just written a song he was sure could be a hit single for them. Watts
listened to the demo and took it to Hunter, who knew Bowie was right. With
help from Bowie's management, they got out of their deals with Island and Guy
Stevens, signed with Columbia and released the song. Mott The Hoople was

(Soundbite of music)

Unidentified Singer: Well, Billy rapped all night about his suicide, how he
kick it in the head when he was 25. Speed jive, don't want to stay alive when
you're 25. And Wendy's stealing clothes from Marks and Sparks, and Freddy's
got spots from ripping off the stars from his face, funky little boat race.
The Television man is crazy, saying we're juvenile delinquent wrecks. Oh,
man, I need TV when I got T-rex. Oh, brother, you guessed, I'm a dude dad.

Unidentified Chorus: All the young dudes.

Unidentified Singer: Hey, dude.

Unidentified Chorus: Carry the news.

Unidentified Singer: Where are ya?

Unidentified Chorus: Boogaloo dudes.

Unidentified Singer: Stand up, come on.

Unidentified Chorus: Carry the news. All the young dudes.

Unidentified Singer: I want to hear you.

WARD: "All the Young Dudes" also took off in America and the band undertook a
major tour there with Hunter keeping a diary that's since become something of
a rock book classic. I saw them quite a bit during that period and I'm happy
to report that when they played "All the Young Dudes" since nobody could hit
the high notes in the chorus, they set up a mike in the wings so their road
manager, who could hit them, could sing. His name was Stan Tippens.

The revitalized Mott The Hoople continued through 1974 and then called it a
day. Guitarist Mick Ralphs showed up in Bad Company and the others went on to
everything from farming to avant-garde performance. And Ian Hunter's still
doing it with an energetic young band, bad sunglasses and a bunch of unusually
insightful songs.

GROSS: Our rock critic Ed Ward lives in Berlin. He'd like to thank Ian and
Trudy Hunter and Angel Air Records for their help in getting some of the music
we heard.


GROSS: I'm Terry Gross.
Transcripts are created on a rush deadline, and accuracy and availability may vary. This text may not be in its final form and may be updated or revised in the future. Please be aware that the authoritative record of Fresh Air interviews and reviews are the audio recordings of each segment.

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