Repairing The American Automobile Market

Investor’s Business Daily posted an editorial today about President Trump’s visit to Detroit to talk to auto manufacturers. The editorial reminds us of some of the policies initiated by the American government that have created problems for the auto industry. The editorial also suggests some solutions for these problems.

First, the editorial examines the history of CAFE Standards:

For those who don’t know, the federal government first imposed the “Corporate Average Fuel Economy” standard in 1975, in response to the government-caused energy crisis. The standard requires automakers to meet annual fuel economy targets based on the fleet of cars they sell in a year, or pay stiff penalties.

By the time the standards started to bite in the early 1980s — which forced a radical (and deadly) downsizing of the domestic fleet of cars — President Reagan had deregulated the oil industry, thus ending the energy crisis. And now, with fracking, the country is awash in domestic oil supplies.

But the CAFE standards persisted, and President Obama hiked them in 2009 and again in 2011. If left in place, cars will have to get an average 54.5 mpg starting in 2025 — less than eight years from now.

This was a thinly disguised effort by the Obama administration to force electric cars onto the market, since not a single conventional vehicle comes close to that mileage standard today.

This is just another example of the government interfering with the free market to the detriment of the American consumer.

The Standards were supposed to be reviewed in 2017, but the government, under President Obama, reneged on its promise:

Detroit signed on to this idiocy in 2011 in part because it reformed the existing CAFE regulations, but mainly on the promise that they’d have the chance to review and amend the standards in 2017. But just before leaving office, Obama’s EPA regulators reneged on their end of the bargain, locking the 54.5 mpg mandate in place without even a cursory review.

In a recent letter to Pruitt, the Auto Alliance — which represents Ford (F), GM (GM), Fiat Chrysler (FCAU), Toyota, Volvo and other carmakers — pushed him to allow the 2017 review to go on as promised, so they at least can make their case on why the 2025 standard should be eased. Trump announced his plans to do so on Wednesday at an event in Detroit.

The Standards did encourage auto companies to design cars that got better gas mileage. However, now it is time to let consumers make their choices as to what cars and what efficiency they want. The CAFE Standards have raised the price of cars for everyone and not really accomplished much. It is time to encourage auto makers to make cars that get reasonable gas mileage, but not hold them to unreasonable standards. The CAFE Standards need to go.

Some Things Generally Overlooked In The Electric Car Discussion

Electric cars came on the scene a number of years ago. The idea of plugging your car into the outlet in your garage rather than having to look for a gas station is attractive. Also, depending on the price of electricity vs the price of gasoline, an electric car could save you money. However, the basic laws of physics get in the way.

On Friday, The Patriots Business Alliance posted an article about electric cars. The article discussed the physics and business aspect of the cars:

Does the move to electric vehicles result in a reduction in the total energy necessary to achieve the same result? Simple answer, no. In its simplest measure, it will take the same amount of energy to move “X” number of pounds from point A to point B if all the other variables are the same. Now, is there any evidence that how that energy is applied or utilized really makes a difference? Not as far as I have found.

So, for the vehicle type that the “green” energy advocates consider to be the best result, the plug-in hybrid, where does this energy come from? We will examine only the US model at this point. This is the US electrical supply in 2015 by generating source- Coal = 33%, Natural gas = 33%, Nuclear = 20%, Hydropower = 6%, other renewables = 7% including, Biomass = 1.6%, Geothermal = 0.4%, Solar = 0.6% and Wind = 4.7%, and last but least, Petroleum = 1%. From this information we have to see that the plug-in hybrid is first and foremost a coal, natural gas and nuclear powered vehicle. But that’s just part of the equation because this doesn’t take in to account the amount of energy that is lost through the transmission process. Most people don’t understand, or even consider, that the amount of energy that is fed in to the transmission grid is reduced by the amount of energy consumed in the transmission process before it reaches the point of use. But in evaluating the “greenness” of the plug-in hybrid this must be considered because it is part of the equation. Also, the plug-in hybrid still must have a supplemental internal combustion gasoline engine in case you need to go farther than you can go on a charge.

That is a whole lot more technical information than my brain can handle, but if I understand it correctly, the bottom line is that an electric car does not actually conserve energy.

The article further explains:

Now, let’s look at a practical example, the Chevy Cruze, a standard gasoline-powered vehicle, and the Chevy Volt, the plug-in hybrid version of the same car. First is the weight- Chevy Cruze- 2835#, Chevy Volt- 3543#. WOW! The immediate thing you know is that it’s going to take 25% more energy to drive the Volt than the Cruze just because of the added weight from the batteries. Did you, or anybody, ever even consider this in the conversation? I’m just guessing the answer to that question is NO. Next is the price- Chevy Cruze- $18, 120, Chevy Volt- $33,220. WOW!! For the privilege of using 25% more energy to achieve the same result, you get to spend ~45% more to purchase the vehicle. Can you say, “What a bargain!” And we haven’t even mentioned the crony capitalism that is put in place to at least make you think you’re getting a kiss while you’re getting screwed.

The article concludes:

There is another element of this situation I would like to address in closing and that is how the plug-in hybrid in general removes you, the consumer, from the market when it comes to the purchasing of your vehicle fuel. Good or bad, with the plug-in hybrid you’re tied to government-controlled electric rates for the pricing of your vehicle fuel. In the last 24 months the price at the pump of gasoline has gone down over 40% where your price per/KW of electricity has actually increased. Just something you can think about when you have to spend more “green” to fuel your electric car. Are you feeling really green yet? Or just hosed?

Green energy is just another highway to increase government control of our lives.

 

The End Of A New York City Tradition

Horse-drawn carriage rides through Central Park have been associated with New York City for about 100 years. Now those carriage rides are in danger. On Thursday, CNS News reported that newly-elected New York City Mayor Bill de Blasio plans to replace the horse-drawn carriages with electric cars. The cars would be built with the look of antique cars and would have a driver so that current carriage drivers would still have jobs. However, the article does not mention the horse owners and stable owners who would lose their jobs.

The Mayor claims that horse carriages are “not humane” and are cruel to the animals. The carriage owners are requesting that the Mayor take a tour of the stables where the horses are kept before he makes a decision.

This is being reported as a ‘cruelty to animals‘ issue. Since when is asking a horse to pull a carriage animal cruelty. If the concern is that the horses sometimes have to deal with vehicle traffic, it might make more sense to ban cars within Central Park and leave the entire park to the horses.

Stay tuned. I am sure there is much more to come.

Enhanced by Zemanta

When Green Isn’t Green

On Monday the Wall Street Journal posted an article by Bjorn Lomborg,  director of the Copenhagen Consensus Center in Washington, D.C., is the author of “The Skeptical Environmentalist” (Cambridge Press, 2001) and “Cool It” (Knopf, 2007). The article explores the idea that electric cars actually have a smaller carbon footprint than regular cars.

The article reports:

A 2012 comprehensive life-cycle analysis in Journal of Industrial Ecology shows that almost half the lifetime carbon-dioxide emissions from an electric car come from the energy used to produce the car, especially the battery. The mining of lithium, for instance, is a less than green activity. By contrast, the manufacture of a gas-powered car accounts for 17% of its lifetime carbon-dioxide emissions. When an electric car rolls off the production line, it has already been responsible for 30,000 pounds of carbon-dioxide emission. The amount for making a conventional car: 14,000 pounds.

…If a typical electric car is driven 50,000 miles over its lifetime, the huge initial emissions from its manufacture means the car will actually have put more carbon-dioxide in the atmosphere than a similar-size gasoline-powered car driven the same number of miles. Similarly, if the energy used to recharge the electric car comes mostly from coal-fired power plants, it will be responsible for the emission of almost 15 ounces of carbon-dioxide for every one of the 50,000 miles it is driven—three ounces more than a similar gas-powered car.

Mr. Lomborg states that he is not opposed to electric cars–he believes that eventually we will find a way to design and manufacture them to be environmentally friendly. Unfortunately, right now we are spending money subsidizing the industry and the people who purchase electric cars rather than putting the money into research. It is quite possible that at some point in the future we will have an electric car that makes sense environmentally, but right now all we have is symbolism over substance.

Enhanced by Zemanta

Have They Really Thought This Through ?

The Obama Administration is using taxpayer money to subsidize electric cars. John Hinderaker at Power Line posted an article yesterday that pointed out that only 29 percent of Americans support those subsidies. Please follow the link to see a wonderful cartoon that explains exactly how electric cars work! The article at Power Line reminds us where the electricity for electric cars comes from–coal-fired power plants.

The article points out:

Note, too, that as the Obama administration feverishly tries to put power plants out of business with onerous new regulations, the effect will be to force the cost of driving electric vehicles higher and higher.

Man has been looking for the perpetual motion machine for centuries. We haven’t found it yet. Meanwhile, the Obama Administration is attempting to subsidize it!

Enhanced by Zemanta