After stridently supporting the Wall Street bailout, this morning’s Washington Post’s lead editorial launched a broadside against the bailout plan for the automobile industry. Amid this uneven editorial, which both raises legitimate questions and displays an impressive tone-deafness when contrasted with supporting bailouts for financial ‘tycoons’, is this paragraph:
Congress approved $7,500 tax credits for purchasers of GM’s much-touted plug-in hybrid Chevy Volt, built to run 40 miles on a single electric charge. That would knock the net cost of the four-seat Volt, due out in late 2010, down to $32,500 — not much less than a basic Cadillac CTS costs now. Even then, it could take a decade of Volt driving to recoup the difference in purchase prices between it and the far cheaper Toyota Prius. Assuming a few well-heeled drivers take that deal, why should poorer people be taxed to enable them?
This paragraph provides a window on a stunning level of ignorance and shallow-thinking in the Post‘s editorial team when it comes to energy, technological innovation, business and other issues.
What are just a few of the things wrong with this one paragraph?
1. The $7,500 is not just “for purchasers of GM’s much-touted plug-in hybrid Chevy Volt,” but for all plug-in electric vehicles (PHEVs) and electric vehicles (EVs) that meet standards of performance.
2. This comparison of the Volt to the Prius is eerily similar to comparisons of a Prius with a Corolla or Echo by those opposing hybrids. Reminding me of SAT tests, “the Volt is to the Prius as the Prius is the Echo” is an accurate statement. Why? Because the Volt is not just more advanced technologically (a PHEV vs a Hybrid-Electric Vehicle (HEV) in a way to save fuel, but also is a quite different car, in a ‘different class’ in terms of features and promised performance. Thus, the Volt is to the Prius just as the Prius is roomier and with many more features than is in the Corolla and Echo. Thus, the ‘price’ differential is not solely related to plug-in vs non-plug-in hybrid technologies.
3. Again, in terms of comparison, the choices are not just about very narrow discussions of “cost” but also about “value” for that cost. When it comes to hybrids, doubters like to focus solely on “cost of fuel”, ignoring many other values such as a quieter car (especially at stop signs, for example), better acceleration, and even the simple satisfaction from reducing one’s pollution load for the same number of miles driven. These have “value”. The move from a HEV to PHEV or EV will offer similarly ‘upgrading’ of values (such as the ‘value’ for having near silent driving for tens of miles which might make ‘driving with the windows open’ far more enjoyable). These are real values, elements for which people place a “value” and for which they will pay some degree of a premium over some other product. Does the Washington Post consider it necessary to editorialize about the ‘return on investment’ from racing stripes?
4. This is about working on paths to foster innovative technology and to get that technology from the development laboratories into the market space. The $7,500 is meant to try to foster a more rapid introduction of technologies that will foster an electrification of ground transport. The initial cars / systems will have a premium. The $7,500 is there to encourage faster and greater adoption of a leading edge technology. The Washington Post editorial board, evidently, wants America and Americans to rely on current technology imported from overseas to be upgraded to something better when (or if) those foreign interests wish to deign to introduce it to the US market. Want America to be leading edge in 21st technologies, 21st green technologies? Well, then incentives like this one are part of the path for getting there.
5. And, The Washington Post chose to utterly ignore the fundamental reasons why a $7,500 incentive might have broad-based support. That $7500 is to help foster rapid introduction of a technology and approach that could help dramatically reduce America’s reliance on and vulnerability to imported oil. In the face of gas shortages (such as what Atlanta faced last month), Volt (and other PHEV/EV) owners would have an ability to drive (limited distances) without a drop of gasoline. The PHEV enables not just a direct fuel cost savings but also a very real path toward cutting light-vehicle reliance on fossil fuels by 75% or more as compared to traditional internal combustion engines. This will help America’s oil addiction. And, by the way, there is that minor little issue of Global Warming. The PHEVs/EVs offer a path toward far lower polluting driving than exists as an option today.
While this Post editorial, Welfare for Detroit, is misguided on many levels socially and economically, when it comes to Energy Smart — it simply isn’t and is more appropriately described as energy ignorant.
3 responses so far ↓
1 Bruce McIntire // Oct 27, 2008 at 1:35 pm
Thanks for posting the article, was certainly a great read!
2 David West // Oct 27, 2008 at 1:36 pm
Well said!
Not to mention that one of the main intents is to reduce dependancy on foreign oil, emissions and climate change. By driving the first 40 miles in ALL ELECTRIC mode, petroleum use and emissions are reduced to nearly ZERO for most typical driving days. This is a leap ahead worth twice the current tax credit of $7,500. I applaud any company who steps up to the challenge to develop similar or even competetive performnce. Well done GM. I hope you sell 2 million a year some day soon!
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