In order to qualify an old vehicle must get less than 18 miles per gallon.
(Photo source: IFCAR at Wikimedia Commons)
After a meeting with the White House, Members of Congress appear to be close to a deal
on a so-called “cash for clunkers” program. But Tamara Keith reports critics say the
compromise members have come up with won’t do much for the environment:
Transcript
After a meeting with the White House, Members of Congress appear to be close to a deal
on a so-called “cash for clunkers” program. But Tamara Keith reports critics say the
compromise members have come up with won’t do much for the environment:
The “cash for clunkers” program has wide support as good for the environment; good for
the ailing auto industry.
Car owners would get a voucher towards a new fuel efficient car when they scrap their
old gas guzzler. In order to qualify an old vehicle must get less than 18 miles per gallon.
But a new car that does just 4 miles per gallon better earns a $3,500 reward. A
10 MPG improvement brings $4,500.
Critics say many of the new replacement vehicles would fall well short of the
government’s average fuel economy standards.
Congressman John Dingell from Michigan says the critics are missing the point: the new
cars will be more fuel efficient than the ones that are getting junked.
“What they aught to ask is, ‘what is this going to mean in terms of increased fuel
efficiency and reduced CO2 emissions.’ The result will be substantial.”
Of course the deal isn’t really done until it is approved by Congress. If it passes, the
President is expected to sign it.
Today almost everything that goes into your car's gas tank started as oil (Photo by Shawn Allee)
How you fuel your car could change pretty quickly. California air regulators are requiring gasoline producers to reduce greenhouse gases by 10% by 2020. That could force big oil companies to invest in alternative fuels. Tamara Keith reports when it comes to environmental regulations, what happens in California usually spreads from there:
Transcript
How you fuel your car could change pretty quickly. California air regulators are requiring gasoline producers to reduce greenhouse gases by 10% by 2020. That could force big oil companies to invest in alternative fuels. Tamara Keith reports when it comes to environmental regulations, what happens in California usually spreads from there:
Today almost everything that goes into your car’s gas tank started as oil. But in the future it could be very different.
“The fuels that we will be moving towards are electricity, biofuels and hydrogen mostly.”
Daniel Sperling is a member of the California Air Resources Board which voted in the new rule.
Sperling says the goal is to reduce the overall greenhouse gas emissions from vehicle fuels. That could mean oil companies might even have to buy credits from power companies for electric cars.
“You start transforming the oil industry, getting off of oil. I mean that’s what we talk about and this is a policy that will actually do it.”
The California rule even looks at how much greenhouse gas pollution goes into making corn ethanol.
Oil companies say fuel prices will definitely go up in California.
Kathryn Stewart and her boyfriend Roger Williams have gone car-free in Phoenix. They live 30 miles apart, so it can be a very long bike ride to see each other. (Photo by Rene Gutel)
The cars we drive pump out a lot of pollution. The average car puts out about 10,000 pounds of carbon dioxide every year. So whenever we drive, we’re adding to the global warming problem. To cut down on that pollution, there are some people who are giving up their cars altogether. They’re joining a movement called the “World Carfree Network.” Rene Gutel reports on one of their members:
Transcript
The cars we drive pump out a lot of pollution. The average car puts out about 10,000 pounds of carbon dioxide every year. So whenever we drive, we’re adding to the global warming problem. To cut down on that pollution, there are some people who are giving up their cars altogether. They’re joining a movement called the “World Carfree Network.” Rene Gutel reports on one of their members:
Kathryn Stewart doesn’t own a car. She’s never even had a driver’s license. She’s an editor at a publishing company and commutes mostly by bus and by bicycle.
And while you might think you know plenty of people like Stewart, especially in big cities such as New York or Chicago, consider this: Stewart lives in Phoenix – the land of freeways and strip malls and summers that top 115 degrees.
“Honestly it’s really difficult in Phoenix. It’s challenging but not impossible if you’re really committed to it. It takes a lot of advance planning.”
(sound of street)
Stewart’s work is just a few miles away, but it takes her half an hour to get there.
She says one of the hardest parts of being carfree in Arizona are those broiling summer days. But she has a secret weapon – a heat-shielding umbrella that she daintily refers to as her parasol.
“My parasol is great. I don’t care how I look – it’s amazing.” (laughs)
But major cities in the US aren’t necessarily built for people who like to walk to work. This is especially true in the West.
Carol Johnson is a planner for the city of Phoenix. She says this is due, in part, to a theory that was popular in the 1960s, when everything was planned for the car.
“This is my opinion, maybe there were some efficiencies of scale in terms of infrastructure – if you only had to put one road in, even it was six lanes wide, that was more efficient.”
But a lot of cities now are trying to get people out of their cars. They want to cut pollution and ease traffic problems.
The mayor of New York, for example, proposed a fee on cars to get more people to take public transit. And San Francisco hosts “CarFree Days” where they promote walking, running, and bicycling.
(sound of biking outdoors)
Okay so this may all sound well and good, but what does being carfree mean for Kathryn Stewart’s social life? How does she meet people and have any fun in this city built for cars?
Turns out she manages. She and her boyfriend – Roger Williams – see each on weekends. They like to take bike rides.
“We going right or left, Roger? Take a left. After these cars.”
They live about 30 miles apart – not a long car trip, but by bike, the ride can take two and a half hours. Williams owns a car, but he figured out pretty early on in their relationship that a willingness to be carfree was a good way to impress her.
Williams: “The first real date that we did, I surprised her and she was asking me questions, oh what are we going to do? Where are we going to go? And I’m like, it’s a surprise but we’ll be able to walk the whole date.”
Gutel: “So you were like the carfree Casanova?”
Williams: (laughter) “I love it! I saw the opportunity and I seized the opportunity.”
Stewart and Williams also encourage each other to be healthy and have less of an impact on their environment by the foods they eat. But being carfree, that’s the main sacrifice.
“I really feel like I’m making a big dent, cause, you know, there’s a lot that people say you can do, make small changes, do this, do that, but when you don’t have a car, it’s automatically, like, a big change.”
Stewart says she realizes it’s big change most people would have a hard time with. But it’s a choice she’s dedicated to in order to do something about global warming.
Congress is trying to work out a bill that would mean bring in a clunker, get cash towards the purchase of a new high mileage car (Photo source: Flicka at Wikimedia Commons)
On Capitol Hill, there’s growing momentum for legislation called “Cash for Clunkers.” In fact, there are several bills circulating in Congress and the details are in flux. But the general idea is to use tax dollars to encourage people to trade their old gas guzzling clunker for a new fuel efficient car. The hope is to help the slumping auto industry and the environment at the same time. Tamara Keith gives the environmental claims a test drive:
Transcript
On Capitol Hill, there’s growing momentum for legislation called “Cash for Clunkers.” In fact, there are several bills circulating in Congress and the details are in flux. But the general idea is to use tax dollars to encourage people to trade their old gas guzzling clunker for a new fuel efficient car. The hope is to help the slumping auto industry and the environment at the same time. Tamara Keith gives the environmental claims a test drive:
At DarCars, a Toyota dealership in Silver Spring, Maryland people are shopping for cars.
But business is down.
Tammy Darvish is vice president of DarCars automotive group. Here’s how she describes “cash for clunkers.”
“It’s money from heaven.”
Well, from angels in Congress anyway. Bring in a clunker, get cash towards the purchase of a new high mileage car.
“I think they were talking about $4,000 or $5,000 or even $2,000. Whatever it is. Any incentive that you could add to the manufacturer incentives and the dealer incentives just make it all the better deal for the customer.”
And as we walk around the lot, Darvish points out plenty of cars she figures could qualify as fuel efficient replacements for clunkers. Like this one that gets 35 miles to the gallon on the highway.
“So here’s a Corolla and it’s not a hybrid technology vehicle and it’s still getting great gas mileage and all the manufacturers have vehicles, you know in those ranges.”
But not everyone is sold on the merits of a cash for clunkers program.
Dan Sperling heads the Institute for Transportation Studies at University of California Davis.
“What it mostly does, and we should be honest about it is it stimulates vehicle sales.”
He says this is more an economic policy with a green polish.
“It is supporting the use of more low carbon efficient vehicles, that’s good. It is supporting the automotive industry. That’s good. The problem is, it’s a very expensive way to do that.”
Whether a federal cash for clunkers program will be able to claim environmental success will largely come down to what counts as a clunker – and just how fuel efficient the car that replaces it needs to be.
For example, one version of the legislation would allow any car 8 years old or older to be junked in exchange for cash.
But an 8 year old car isn’t exactly a gelloppe. That’s younger than the average car on the road.
Bill Chameides is dean of the Nicholas School of the Environment at Duke University.
“I would say that cash for clunkers programs that only put a requirement on the age of a car, from an environmental point of view is a real clunker, if you pardon the pun.”
To really analyze the environmental impact of a program like this Chameides says you also have to consider what it takes to manufacture a new car. And it turns out a lot of greenhouse gas emissions come from building a car.
“When you drive that new car out of the showroom, you already have 1 year of carbon dioxide emissions already in the atmosphere.”
So, to make up for those emissions, he says cars getting junked have to be real gas guzzlers, and the new cars need to be gas sippers.
“If we want to sell this as an environmental program we need to make sure that it’s focusing on really making a difference in the amount of gasoline we use, the amount of CO2 we emit. And therefore we need to have a limit on the miles per gallon of the scrap car. It need to be way down at the bottom of the spectrum. And we need to have a limit on the new car. It needs to be up high on the spectrum.”
There’s disagreement in Congress about what the mileage requirements for the program should be.
It’s one of those details yet to be worked out, that will determine just how green cash for clunkers will really be.
Raser Technologies has been showing off its electric hummer that can get 100 miles per gallon. (Photo courtesy of Raser Technologies)
A technology company is showing off its 100 mile-per-gallon Hummer to Wall Street. Lester Graham reports:
Transcript
A technology company is showing off its 100 mile-per-gallon Hummer to Wall Street. Lester Graham reports:
Today, the honor of ringing the opening bell at the New York Stock Exchange went to Raser Technologies – and the company brass parked a Hummer-H3 out front.
It’s powered by Raser’s completely electric drive-train. The system uses a gas-powered engine, but only for generating electricity to recharge the battery.
David West is the Vice President of Marketing at Raser Technologies. He says they modified a Hummer, but that’s just one example.
“It was designed appropriately not just for the Hummer H-3, but it’ll power a Ford F-150, a Chevy Silverado, a Dodge 1500. These are the top-selling vehicles in America.”
Raser Techonologies side-steps questions about price, saying if automakers used the system in a production model, a vehicle’s price would be in the range of a fully-equipped pick-up or SUV.
These Suzukis at Ken Butman's dealership, which were in high demand last year, are now sitting unsold (Photo by Samara Freemark)
Chances are, you haven’t bought a new car this year. Auto sales are down across the board – including in the small car and electric-gas hybrid markets. Now some dealers and automakers are proposing a way to move some of those cars: increase the gas tax. Samara Freemark explains why the same people who sell cars might want to make driving them more expensive:
Transcript
Chances are, you haven’t bought a new car this year. Auto sales are down across the board – including in the small car and electric-gas hybrid markets. Now some dealers and automakers are proposing a way to move some of those cars: increase the gas tax. Samara Freemark explains why the same people who sell cars might want to make driving them more expensive:
It was almost exactly this time last year that Ford dealer Ken Butman
traded in his pickup for a Suzuki hatchback.
His Ann Arbor, Michigan
dealership had been selling Suzukis for a couple of years. But they got
really popular last spring when gas prices jumped. Butman ordered a big
shipment to keep up with the demand.
“These are the Suzukis. These little cars get good gas mileage. And
they’re so cute. Look at them. Look at this one here. It’s got a little
rack for your skis. Look at
that.”
But those cars – the ones Butman ordered a year ago – most of them are
still here. They’re still sitting on his lot. Not moving.
“It was strange because they were so hot. For awhile there you couldn’t
give a big car away. And everybody was rushing to the small cars. And then
just as quickly, about when the price of gas came down again, we saw a
complete reversal. Like a light switch. That’s how fast it cut off.”
It’s been like that all over the country. Dealers who last year had
waiting lists for hybrids and small cars suddenly have a lot of extra
inventory. Sales of hybrids are way down from last April, mostly because
gas costs about half what it did last year.
Brett Smith is an auto analyst with the Center for Automotive Research. He
says consumers only really care about fuel economy when gas prices are
high. When gas hits about 4 dollars a gallon, consumers switch to fuel
efficient cars. When prices drop again, so do sales of efficient cars.
“Look at what’s happened every time we’ve had an energy crisis. We’ve
gone to smaller cars for a couple of years, and then the consumer has gone
back to larger cars. Why? Because at that fuel price they can get away with
it, they can justify it.”
It’s a real problem for dealers. It also worries auto manufacturers who
have poured money into developing hybrids and have a lot of new models due
to come out this year.
And that’s why some people who sell cars have begun to push for
increasing the gas tax.
Dealers and auto executives might not seem like the first bunch to line up
behind a tax hike. Traditionally they’ve lobbied hard against anything
that makes driving more expensive.
But a high tax – and therefore, higher gas prices – could get all those extra
hybrids moving again.
Michael Jackson is the CEO at AutoNation. That’s the
nation’s largest chain of dealership.
Jackson wants to see gas at four
dollars a gallon – the figure at which many analysts say consumer behavior
changes. And he thinks the government can keep prices at that magic number
with a floating tax.
Auto makers have been a little more cautious. But some top executives at
American companies have called Jackson’s ideas ‘smart’ and ‘worth
looking into’.
Smith says they believe that higher gas taxes could
stabilize the market for fuel efficient cars – making investment in new
technologies a safer bet.
“The car companies will rarely come out and loudly say, things like, ‘we
think there needs to be a gas tax.’ But almost all of them will say on the
side, if you want people to drive more fuel efficient cars, the best way to
do it is a gas tax.”
For now, though, it might not take a big tax to bring gas prices back up.
Oil trader Anthony Grisanti is the president of GRZ Energy. He says an
economic recovery would do pretty much the same thing.
“Shouldn’t be any doubt about it, once the economy picks up, say,
beginning of next year or year after that, you’re going to start to see oil
prices go higher.”
And that means prices at the pump would go up too.
Proposing higher gas taxes – especially of a couple of dollars a gallon – can
mean career suicide for politicians. So a big hike in the gas tax seems
iffy. But if gas prices rise as the economy recovers, dealers might see
those fuel efficient cars move off the lot again.
Some think that a gas tax is the only way to get consumers to buy fuel efficient cars (Photo courtesy of the US Department of State)
Some in the auto industry are proposing a hike in the gasoline tax. The idea is this: if you want people to buy small cars, make gasoline more expensive. Lester Graham reports:
Transcript
Some in the auto industry are proposing a hike in the gasoline tax. The idea is this: if you want people to buy small cars, make gasoline more expensive. Lester Graham reports:
Car dealers and manufacturers say a higher gas price is the only thing that gets people buying more fuel efficient cars. So, a tax hike makes sense.
But, a guy who has a lot of sway on the idea of a gas tax hike is not going there.
Congressman Ed Markey chairs a House subcommittee on Energy and the Environment.
At a forum at MIT he said the plan is to stick with CAFÉ — the Corporate Average Fuel Economy standards – to get better mileage cars.
“That’s the route that we’re taking rather and an increase in the gasoline tax. We’re moving towards a mandate and 35 miles per gallon is the minimum that we intend on reaching by 2020.”
And under the stimulus package, new tax credits amounting to thousands of dollars get kicked-back to anyone buying a fuel efficient car.
Right now, cars get an average 27 and a half miles per gallon. By
2011, they'll have to get 30.2 (Photo by Ben VonWaggoner)
The U.S. Environmental Protection Agency issued new vehicle fuel economy standards for cars and trucks. As Tracy Samilton reports, it’s the first change since 1985:
Transcript
The U.S. Environmental Protection Agency issued new vehicle fuel economy standards for cars and trucks. As Tracy Samilton reports, it’s the first change since 1985:
Right now, cars get an average 27 and a half miles per gallon. By
2011, they’ll have to get 30.2. Light trucks, including SUVs, will
have to get 24.1 miles per gallon, up a mile per gallon.
Eli Hopson
is with the Union of Concerned Scientists. He says the change is not
dramatic but it’s still an important milestone.
“The car standards haven’t
changed. They’ve been at 27.5 for over twenty years. It is a big deal. It’s
been a long time in coming.”
Carmakers are prepared for the new standard and say they’ll meet it.
Future standards will be tougher.
Auto companies usually complain
when mileage standards are raised. But times have changed, especially
for Chrysler and GM. They might not be as vocal since accepting
billions in federal loans.
President Obama has outlined his plans
for the struggling auto industry. They
include restructuring GM and Chrysler
as well as help for auto workers and
communities hurt by slumping car and truck sales. Lester Graham reports lost in the details was the President’s bigger plan:
Transcript
President Obama has outlined his plans
for the struggling auto industry. They
include restructuring GM and Chrysler
as well as help for auto workers and
communities hurt by slumping car and truck sales. Lester Graham reports lost in the details was the President’s bigger plan:
In one sentence President Obama summed up his vision for the U.S. auto industry.
“I am absolutely committed to working with Congress and the auto companies to meet one goal: the United States of America will lead the world in building the next generation of clean cars.”
Some analysts say the market should decide whether consumers want fuel-efficient, clean cars. They point to headlines noting hybrid car sales fell off a cliff since gasoline prices went down.
But J.D. Power and Associates’ Michael Omotoso says yeah, hybrid sales are down – but not as much as everything else.
“Hybrid sales are actually doing well compared to overall sales.”
Hybrid sales in February were down 29% from last year, but overall light vehicle sales fell 40%.
Omotoso says hybrids are still selling because people expect gas prices will go up as the economy recovers.
Tesla's Roadster Sport - a 2-seat sports car priced at $100,000 (Photo courtesy of Tesla Motors)
If you want a clean electric vehicle to cruise the highway today, you really only have one option – a small, Silicon Valley company named Tesla. Tesla has plans to be a big player in the auto industry, but so far the company has only built a few hundred cars. Dustin Dwyer looks at whether Tesla can make it in one of the toughest industries around:
Transcript
If you want a clean electric vehicle to cruise the highway today, you really only have one option – a small, Silicon Valley company named Tesla. Tesla has plans to be a big player in the auto industry, but so far the company has only built a few hundred cars. Dustin Dwyer looks at whether Tesla can make it in one of the toughest industries around:
If you’re trying to get attention for a new vehicle, a big auto show is one of the best places to get it.
And even this year, as GM and Chrysler hobbled into the Detroit auto show on federal life support, and all carmakers scaled back, there was still a lot of hype.
Here’s GM’s introduction for the Chevy Volt.
“Ladies and gentlemen, the future of automotive transportation has entered the building.”
That’s how the big players make their announcements.
Tesla is not a big player.
CEO Elon Musk made his big announcement in a hotel conference room in front of a bunch of geeky auto analysts.
“A big announcement that I’ve just gotten this morning permission this morning to make is, um” (takes drink)
Here he takes a drink of his water.
“…that Daimler has given us permission to acknowledge that they are the automotive partner that we’re working with.”
That means Tesla is going to help make an electric version of Daimler’s tiny Smart Car.
Musk is not much of a salesman. But maybe he doesn’t have to be. While all the big carmakers are seeing huge sales drops, Musk says Tesla sales keep going up.
“And, well, actually we can’t produce them fast enough and we’re sold out through November of this year.”
Now, Tesla – at most – makes 30 vehicles a week. And its only car, a sporty roadster, sells for more than $100,000.
A company like GM sells thousands of cars a week, and people who aren’t movie stars can actually afford some of them.
But Musk says he wants Tesla to be more than just a small time player.
So now the company is working on a four-door sedan that will sell for about $50,000 – still pricey for most of us, but half the price of its two-seat roadster.
Here’s the thing though, right now, Tesla has the electric vehicle market all to itself. But all the big companies are working on their own electric cars.
So when Tesla comes out with its four-door sedan, the competition will be much tougher.
Michael Robinet is an auto industry analyst with the firm CSM Worldwide. He says Tesla’s small size is a problem.
“Economies of scale is one of the main drivers of this industry to get cost out of the vehicle and be competitive. And that’s where the major vehicle manufacturers are going to have a leg up in the future.”
Some who follow the auto industry think Tesla’s future could be as more of a partner to existing companies, like what Tesla is doing with Daimler.
But Elon Musk insists Tesla will continue to make its own cars. And it can succeed.
“You go through sort of stages of denial, I guess. You know, when we first said we’d make this car, people said you can’t make this car. It’s not going to work, the technology’s not going to work, and even if the technology works, nobody’s gonna buy the damn thing. And we’ve shown, hey, we can make the technology work and people really want to buy it. So, okay, then they go to the next stage, ‘Oh, well, sure, okay, people will buy that car, but they won’t buy a sedan.’”
Tesla plans to unveil the new sedan later this month (March 26). The car is expected to go on sale in 2011.
In the meantime, Tesla has not been completely immune to all the problems facing the auto industry. Tesla had trouble raising money last year to finance the new sedan. So it turned to the federal government for a 350 million dollar loan.
At least in that one sense, Tesla is already acting like a major player.
In order to qualify an old vehicle must get less than 18 miles per gallon. (Photo source: IFCAR at Wikimedia Commons)
