Cars and business

Oikos: The environmentally destructive tax rort for cars. The bottom line:

There’s lots of talk about new measures to discourage the use of fossil fuels and debates about carbon taxes, carbon trading, mandatory renewable targets and so on. But a good start would be simply removing the economically questionable and environmentally damaging tax breaks that exist for private cars.

Can’t say I disagree. I know a few people that have cars as part of salary packages or work pays for them – what say ye?

Clean cars, today

TreeHugger: The Car the Automakers Can – and Should – Be Making.

I’ve thought this a lot – good to see the Union of Concerned Scientists (UCS) putting lie to auto-makers claims that they are doing their best, or that it’s not possible.

All this as Holden sacks 600 workers in its Australian manufacturing business. How much is management in these companies being paid to connect the dots? And missing them wildly…

What the UCS shows is that with existing technologies we could see a dramatic improvement in efficiency and emissions. Imagine what’s possible if we actually innovate and rethink things a little… The NuStroke engine is an example of this kind of thinking.

Update: KPMG today released a statement recommending some of the same things.

Remarkable Prius

Seth Godin often talks about aiming for “remarkable” – I found this little tidbit over at Treehugger that exemplifies this.

Toyota in the US has had waiting lists for Prius’ for some time, with demand outstripping Toyota’s ability to build the vehicles. Given this, I found it quite extroadinary that:

… starting in April, Toyota will be showcasing the Prius in its first advertising campaign since the hybrid was introduced to the U.S. in 2000.

In other words, the Prius has literally been selling itself without the fancy advertising campaigns usually afforded new car releases. It’s all be word of mouth and PR. A remarkable product indeed.

I’ve seen ads for the Prius in Australia – but if this is true in the US, it seems quite extraordinary…

Latte Lexuses?

David over at Oikos posts an excellent overview of car efficiency standards in the US, and how they might apply in Australia. Café standards for cars: Espresso Excels and latte Lexuses.

Al Gore mentions efficiency standards in An Inconvenient Truth, and they are also referenced, from memory, in Who Killed the Electric Car. David’s piece gives a good overview (including the costs to manufacturers) and also suggests that such standards wouldn’t be as effective in Oz.

Update 26-Jan-2006: Martin Eberhard responds to the energy portion of Bush’s State of the Union speech with specific discussion of CAFE standards.

Subsidising the wrong things

So, I was reading in Wheels magazine today that Ford Australia received $100 million in funding from the government so that they could keep open their manufacturing operations here.

To put that figure into perspective, the government has committed $75 million towards the recently announced “world’s largest” solar energy plant [Replaced broken link 14 Mar 2017].

Obviously the intent is to maintain a manufacturing presence in Australia which will support Ford’s workers, but also the component manufacturers that supply Ford. I’m not a fan of subsidies for uncompetitive industries, but on balance it sounds reasonable. (I’d love to know how many people would be affected by Ford closing local manufacturing – could that $100 million be better spent re-skilling the workforce? But I digress…)

Of course, that mag went to press before the layoffs announced the other day. These layoffs are blamed on rising oil prices, and a drop in “big car” sales.

This is not a new trend. Car manufacturers that are relying on “big car” sales, like Holden (Commodore) and Ford (Falcon) have been seeing declining sales of their bigger models for years, with a particularly steep drop in the past year. The biggest selling cars for some time have consistently been smaller cars. And the dominant player at the moment is Toyota.

You’d think they’d cotton on to the fact that maybe they should be looking to develop smaller cars. Or more efficient engines. Or something! Not just keep building the same old cars that aren’t selling. Certainly it doesn’t seem to be a winning strategy.

But I nearly fell of my chair when I continued reading the article to see that the funding was specifically for development of large cars (specifically V8s if memory serves) and related technology – with a view to export markets. So not only is the government propping up an uncompetitive industry, but it is throwing money at a strategy that is clearly a dud.

In the same edition of Wheels, they interview last year’s Wheels Young Designer of the Year who is close to finishing an internship at Ford (the internship is a prize for winning the award). He is environmentally conscious, and clearly wants to work on cars that are more efficient and environmentally friendly. But Ford aren’t doing a whole lot in that area, are they?

Now to me, connecting the dots is pretty easy. (Am I being too simplistic?) Yet high-paid executives at Ford seem unwilling to see the writing on the wall and change course. Instead of looking for government handouts to prop up their unsustainable “big car” strategy, they should be looking to utilise Australia’s strong design talent to deliver innovation – cleaner, more efficient cars might be a good place to start.

And perhaps our government could think more strategically about spending our tax dollars on a dying business and instead focus it on research and development of cleaner and more efficient technologies. Focus on the development of “green tech” – one of the biggest growing industries worldwide – with a view to position Australia as a leader in the field.

What would it take to switch from subsidising “business as usual” practices to spurring innovation? I do hope we find out soon, coz I fear for the continued economic success of our country if we don’t start changing course soon…

Update 2006-11-10: Just a pointer to the comments section – John has some really interesting points in his post there…

Is the electric car really dead?

There’s a new movie coming out called “Who killed the electric car?” which looks very interesting. But as Joel Makower clearly explains, the electric car is far from dead.

I’ve been following the “plug-in hybrid” story for a little while. Basically, when the Prius came out, a lot of people were asking Toyota if there was a way to get their cars to run purely on electric power. Toyota basically said that there wasn’t a market, so a whole bunch of enterprising hobbiests and businesses started working out how they could do the conversions themselves – and succeeded.

There is growing interest in all electric cars, with battery and motor technologies finally getting to a point to make them feasible. I do hope, however, that as electric cars become more common-place, our energy use also switches to clean sources. Otherwise much of the benefit in terms of emissions reductions could be lost.