Rick Wagoner Does Something Right.

General Motors CEO Rick Wagoner is now calling for higher federal gas taxes. Finally we see the American car companies doing something proactive to protect themselves rather than complaining and dragging their feet ad nauseum about fuel economy standards.

Rick is finally seeing what Europeans have seen for years. The only way to support higher fuel economy is to raise the price of fuel. When fuel economy standards are levied against car makers, they have to sell somewhat unpopular fuel efficient cars, often at a loss, so they can meet the standards, while the big money making gas guzzlers get sold quick because they are popular. As I've said before, this is a top down approach, and it hasn't worked for years. See car makers' financial crisis.

The bottom up approach, the correct approach is to encourage buyers to want to buy more fuel efficient cars. Why would they need to buy a fuel efficient car? The only way it works is if fuel is expensive. I noticed a stark difference in driving habits when I moved to Arkansas. When I lived in Oregon, I lived about 15 miles from town. We only went to town when we really needed to and cut or consolidated unnecessary trips. Gas was somewhat expensive. Therefore, many people drove smaller or at least more modest cars. Compact pickups like Chevy S10's, Toyota Tacomas and Nissans were more popular. Only the more wealthy among them drove the big SUV's, most families with a bunch of kids had minivans, not Suburbans. When I moved to Arkansas, I noticed that there were many more of the large SUVs, pickups and cars. The gas was cheaper.

The truth is, people will buy what they want to buy, you can't tell the car manufacturers to make fewer big vehicles. They make what is demanded of them. Now car makers realize that what is demanded of them (due to their needing money) is fuel efficinet cars. They also realize that they can't keep doing what they always have because the climate has changed. So in order to be able to market and support expensive but excellent electric and hybrid cars like the Chevy Volt, they need gas prices to be higher. We all need gas prices to be higher to support the changes that are necessary to achieve a sustainable existence.

If you buy a gallon of gas, the terrorists win. Really.
WiredForStereo

GM Closing Four Truck and SUV Plants!

In a move that I have been waiting for, for a long time, GM is closing four plants according to the Associated Press in a story out this morning.

Rising gas prices have precipitated a dramatic switch from larger vehicles to smaller ones, and American car companies have been left out in the cold in a sense because their gas sipping options are far less populous than those of foreign car makers.

GM, the one responsible for attempted murder of the electric car not five years ago can now be seen as making amends for that. It now appears that the Chevy Volt just may actually happen. The shift away from bigger vehicles is even more dramatic when you understand that switching from a 10 mpg vehicle to a 20 mpg vehicle saves approximately 600 gallons of fuel per year while switching from a 50 mpg to a 100 mpg saves only 120 gallons. Think if someone switches from a Hummer to a Prius, they would save approximately 750 gallons of fuel a year, and at current prices, that's a hunk of change.

Speaking of Hummer, GM has decided to reevaluate the brand, possibly even selling it. This is the thing I am glad of the most, because Hummer means so much more than just a big SUV, it really represents something to the rest of the world. The rest of the world sees Hummers as small tanks, and here our moderately wealthy drive them as family cars or commuters.

GM says the change is permanent, let's hope so, and let's hope that other car manufacturers do the same. Toyota needs to get rid of Sequoia.

I think with the right impetus, we can transition away from fossil fuels without having a huge crash.
WiredForStereo

A Hummer is cheaper than a Prius?

If you pay attention to the hybrid vehicle products on the market, or environmental issues, you’ve probably seen or heard about this article, or the report which it cites:
http://www.reason.org/commentaries/dalmia_20060719.shtml (A libertarian site.)

I encourage you to read it, but I do not encourage you to believe anything it says. In my ever furthering pursuit of truth, I’ll explain why.

The article says essentially that over the life cycle of the vehicle, a Hummer costs less to own than a Prius.

Let us do a little figuring.

The first mistake the report makes is to assume certain things about the life cycle of the vehicles involved. In fact, the first mistake is the biggest. The report assumes that a Hummer will last 380,000 miles. Yeah, right. What was the last American car that lasted that long? Some Toyotas and Hondas can if well cared for, but American cars are definitely not known for their longevity. The report assumes that a Prius will last no longer than 109,000 miles. This is even more ridiculous than the Hummer is. Prii are warranted everywhere in the world for 100,000 miles, and everywhere in the world but the 49 non CARB states for 150,000 miles. Why would a car company warrantee a car up until the day it is expected to die? Half the cars would die before that day, they’d lose money out the wazoo. Additionally, there are already whole bunches of Prii that have before now exceeded the 100,000 mark. I don’t know of any Hummers that have exceeded the 200,000 mark. Therefore, lets for the sake of argument pretend that they can both last the same amount of time, because realistically they can, and lets go with an even 200,000.

According to GM’s website, a base model H2 costs $56,695 (more than half the price of my house.) A base model Prius costs $21,100 according to Toyota.

My research tells me that the average American drives about 12,000 miles per year, I don’t know if this is completely factually accurate, but for the sake of argument, let’s assume it is.

According to dealers, (CBS News) about the best gas mileage you can expect from an H2 is 10 mpg. Consumeraffairs.com averages the Prius at about 43 mpg. Notice with both of these, I have taken neither the EPA figures nor the manufacturer figures because both of those are notoriously optimistic.

Now that we have our vital information, let’s do just a little life cycle assessment. We take the price, add to it the average number of miles and miles per gallon, assume at this point $3 per gallon of gasoline, cram all that into our trusty TI-83 Plus calculator and presto. At these numbers, both the vehicles should last around 16 years, the Prius during that time will incur a total cost of just over $35,000 while the Hummer will cost you $116,695. That’s right, the Hummer will cost more in gas that the machine itself, while the Prius for gas will cost several thousand less. Just for fun, I calculated the cost for my Corolla at 34 mpg and came up with almost $33,000. Of course, you will also have to factor in the fact that the Hummer uses around twice the oil per oil change, and tires that are just freaking huge and cost quite a bit.

The claim that “exotic metals” are more costly to recycle is completely bogus. The exotic metals contained in a Prius are not a whole lot more than aluminum in the hood and engine, and nickel in the battery. Soon Priuses will have Lithium in the battery. I’ve talked about this before, metals are the best paying back of all recycled materials. Listen to the news about metal prices, they are going way up. Metals can be recycled cheaply and easily and are worth a lot of money.

According to Wikipedia, the claim that a Hummer has a lower life cycle cost than a Prius has been debunked enough to be considered an urban legend. Hopefully, like other urban legends (see dishonest email posts) this will go away eventually. Even the company who published the report has since published newer yearly reports that show the Prius to be as much as 25% cheaper than some SUV’s.

Is a Prius more costly than a Chevy Aveo, certainly. But it also offers more. The Aveo doesn’t offer regenerative breaking or any other hybrid functionality. Hybrids are the future. For every gallon of gasoline you buy, the terrorists win.

The near future is littered with plans for more hybrids from many companies. Today’s spotlight: Phoenix Motorcars. They have a full electric SUV and small pickup they claim will be on the market soon. They have great battery technology and are not bad looking either. Ed Begley has one. Also keep an eye out for plug in Priuses and other cars, they are being tested as we speak and should be on the market soon.

Drive
WiredForStereo