Archive for September, 2011

The paradox and contradiction of more fuel efficient cars like hybrids and electric vehicles

Gas demand went down for 2011 in the US despite increased US refinery production.  As a result, overall oil imports are at a 14 year low (Canadian oil imports are up)!  While less gas consumption is best, the reasons for it are poor…literally!  The struggling economy, high unemployment rate, and negative consumer outlook have all contributed to low gas demand.  While Prius and high fuel economy car sales are up, I don’t think they made a difference in gas consumption compared to these other factors.

However, they do make a dent and every little bit helps.  This is the paradox of the high fuel efficiency car or electric vehicle – they reduce demand which, in theory, will keep the price down due to increased supply.  Americans seem to still love SUVs and while SUVs have a place and purpose, it’s not as a commuter car unless you work on a ranch.

A higher fuel tax has been suggested by many experts as a way to reduce oil imports and promote more fuel efficiency while paying for vital infrastructure improvements to the nation’s crumbling roadways and bridges.  The paradox is that higher fuel efficiency reduce the amount of fuel consumed and therefore, reduce tax income.  In the case of electric cars, they use no gas, therefore pay no road tax.  Which brings up another suggestion, a direct roadway use tax by the mile.  This negates one strong motivation to buy high fuel efficiency cars.  Isn’t the point of federal tax credits to promote electric cars?  Would you still consider a high fuel efficiency car if you were subject to a mileage tax?  Feel free to sign up in our forums and voice your opinion.

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Audi R8 e-tron prototype

When Audi unveiled the original e-tron Concept at the last Frankfurt Motor Show in 2009, a production version seemed to be nothing more than a glimmer in the very distant future. Two years later, it appears that the automaker has made plenty of progress in bringing an electric-powered R8 into the world.

Yesterday in Frankfurt, Audi revealed a new R8 e-tron “technology demonstrator” that represents something fairly similar to the production model we’ll see in the near future. Some unique visual features separate the R8 e-tron from the petrol-powered version, including the carbon fiber vents on the hood and chrome slats in the front grilles and rear bumper. Like the concept, the production version of the car is expected to feature four electric motors sending power to each wheel, with performance targets including 0-60 mph in less than five seconds and a 150 mile range.  From Autoblog

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Dodd-Frank, conflict mineral provision, and electric cars

Dodd-Frank, electric cars, and hybrid batteries

The Dodd–Frank Wall Street Reform and Consumer Protection Act is intended to protect consumers by increasing oversight of wall street.  Unfortunately, many of the provisions are still unfunded years after its passing – that’s how Washington politics works.  Another aspect of how Washington works is the addition of provisions.  Sam Brownback, the current Kansas governor, then a senator, included a provision that requires companies using potential conflict materials in or near the Congo to asses whether they are assisting armed groups in the area.  This could be an interesting aspect on electric car production and cars in general.

It’s good that there is accountability of raw materials but ironic that Brownback’s provision doesn’t fit with the stereotypical pro-business low tax Republican as this requirement will add millions to compliance and business costs.  Some companies like Apple have simply stopped sourcing materials from the area since they don’t want to be seen assisting armed rebels.  While it’s certainly good to cut off funding to African warlords, it also hurt legitimate industry in Congo, the very people it intended to protect.

Are conflict materials used in electric vehicles and hybrid cars?

The question is: what companies are still sourcing conflict materials and minerals from the area and are they making their way into cars?  In my last article on rare earth elements and China, I discussed how 99% of rare earth elements come from China, sometimes under illegal conditions.  Are illegal conflict materials used in electric vehicles and hybrid cars or parts such as batteries, electronics, or other subcontracted materials?

Compliance with Dodd-Frank does not just mean buying directly from a warlord, there are indirect ways to support warlords as well.  Does a legitimate smelter have to pay tolls to a warlord to pass through their territory?   Are legitimate mines owned by a warlord through a shell?  Are the workers at a legitimate mine working under duress?  All interesting questions and I don’t know how far down the supply chain these things are investigated by car companies.  Car companies do not make many of the components that go into their cars-they are subcontracted out.  Does your radio support an African warlord?

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