Short-Circuiting the Electric Car Business

Tait Trussell is a national award-winning writer, former vice-president of the American Enterprise Institute and former Washington correspondent for The Wall Street Journal.


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Another frustration for President Obama: U.S. companies making electric cars and batteries they hope to sell to China, Europe and other markets can’t do business abroad unless they make the products there, according to a Sept. 28 report from Scientific American. The administration was expecting to manufacture 40 percent of the world’s high-tech batteries for electric vehicles and hybrids by 2015. Although the markets will probably flourish overseas, the companies that make electric cars, hybrids, and high-tech batteries for these vehicles can do business there only by manufacturing on foreign shores.

Jason Forcier, vice president for automotive solutions for A123Systems, Inc., based in Watertown, MA, said: “Can we export our batteries to China? The answer is no.” Last year, the Obama administration gave A123Systems $250 million to expand its battery manufacturing in the United States. Forcier said that to grow the battery industry in the United States, demand has to come from the U.S. “to create energy independence and jobs.” Neither, however, can be created to anywhere near the extent to fulfill the administration’s wishful thinking.

Government subsidies aren’t limited to electric cars though. In August, touring a Chicago Ford assembly plant cranking out SUV Explorers, Obama announced a $250 million loan guarantee from the Export-Import Bank for the company. “To all those nay-sayers in Washington…who said that investing in you…was the worst investment we could make, I wish they were standing here today,” Obama was quoted as saying by the Chicago Sun-Times. But Obama must have forgotten that Ford, unlike GM and Chrysler, did not take a federal bail out.

Meanwhile, the green movement in Germany is questioning the supposed environmental benefits of electric cars. The German branch of the World Wildlife Foundation (WWF) discovered to their surprise that “carbon dioxide savings were so small,” according to WWF vehicle expert Viviane Raddatz. Germany, with 41 million cars now, hopes to have one million electric cars or hybrids by 2020. Raddatz said CO2 emissions would be cut by only 0.1 percent.

When Obama campaigned for the Presidency in 2008, he called for the ambitious goal of 1 million electric cars on our highways by 2015. When George W. Bush was in the White House, he saw hydrogen as the future energy of the auto industry. By last summer, however, Obama had laid out his goal for the country’s cars and trucks: They would come “with a plug,” Scientific American reported. The stimulus package provided $2.4 billion for development of plug-ins and the advanced batteries needed to power electric cars. At the same time, Obama chopped $100 million (60 percent) out of federal money intended for hydrogen cars. Soon to follow was the Energy Department’s handing out $25 billion in grants to aid car manufacturers and parts suppliers retool with the hope of making more green-efficient cars and trucks. Car manufacturers have long urged the government to avoid picking winners. They weren’t happy about the decision to slash funding for hydrogen production. But the government’s ownership stake in GM and Chrysler just might influence industry decisions.

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  • Stefcho

    I'm in favor of electric cars because they would cut oil dependence. However, the whole electric thing will need new infrastructure and will affect existing businesses – so that needs to be thought out very carefully.

  • flowerknife_us

    Buying an electric car is an expensive way to stay home.

  • SoundDoc

    Muslim terrorists are determined to destroy our power grid, It is a fact that they do not back down until they prevail at their headlong attempts, What then? America is at the mercy of these roaches. Like Jonathan Swift, we are not as strong as we like to think. While we sleep, our constitution is being undermined and changed by Obama sects into Islamic fascism, robbing us of all freedoms of speech and rights to bear arms. The transformation is like the frog in cold water. Subtly, slowly, the way a boa constrictor creeps over its victim until it consumes its life.

  • John Beatty

    The only "sustainable" energy source is wind, but only if we consume 2/3rds less of it. No source of energy is ifinite, many require as much energy to extract as they produce. Those that don't are the "fossil fuels" and nuclear. Wind, solar, even hydro and tidal or geothermal all require more machinery (thus net energy investment) and infrastructure to extract than they can ever produce at current consumption levels.

    We can cud "dependence on foreign oil" by simply extracting it ourselves. The US has the third largest proven reserves in the world, yet produces only a fraction of it because of the costs of regulation and the NIMBYs that don't want to deal with an occasional spill. America is making its own energy woes worse by insisting that it can be invented away.

    • Angus

      The most effective renewable ans sustainable source is Hydroelectric.

  • winoceros

    Hear, hear!

    What do I do with four small children in the house when I break one of their precious, mandatory, mercury-filled light bulbs? Just write them off and decrease the surplus population?

  • Lori

    What power source is producing all this electricity?
    If it's some form of fossil fuel, where is the savings in eco-terms?

    Also, why are we spending so much money to make electric cars when it seems no one is even questioning why we are continueing the same transportation system (cars) only with a different fuel?

    Where is the vision? Where is the honesty?

  • Ayatollah Ghilmeini

    To the naysayers on this site a

    Q: what happens when you mass produce something?

    A: it gets cheaper

    The technology to watch is GMs Voltec. As innovation takes place, its cost will come down and its subsidy goes away. Picture this beautiful image- motoring into work in a Voltec powered Chevy Tahoe. Once implemented it can get 150 mpg +. I for one am more than willing to have a vehicle that uses 90% less gas, most days I drive less than 50 miles. I will be buying a Volt as my next car. I am cutting my dependency on Saudi oil, what are you doing to cut yours?

    Right now we are dependent country. With the right policies- nuclear and renewables, we can be a free nation, dependent on no one. The sooner we make this future a reality, the better.

    • tanstaafl

      What happening to the Evo 1? Why goes GM need to build a new electric car when it already built one?

    • flowerknife_us

      What happens when when you mass produce something people don't buy?

      Another "bailout.

      Can you afford to buy a new battery out of pocket when the time comes or will you require some additional financing?

    • Angus

      Yes you are replacing dependence on foreign oil with a dependence on Bolivia for the minerals need to make the batteries.

  • Lori

    What is going to produce the electricity to run an electric Tahoe?

  • Bookdoc

    Considering how much oil we have in this country, why the heck aren't we telling the ecotards to butt out and use our own oil. The Chinese cutbacks in rare earth exports may just kill the hybrids anyway.

  • Papa Bear

    I look forward to trading in my Prius for a Chevy volt. Not for the environment or the cost savings but to stop sending money to our enemies.

  • riddler01

    Hey,look at the brightside!When NOBODY buys these things,the price($41,000)will plummet and you'll be able to pick up a"GolfCart"on the cheap!!

  • Chris

    Who wouldn't want to shell out 40K for a car that only goes 50-100 miles before needing a charge and a battery pack that will need replacing in a few years for 15K more?

    If people truly wanted an electric car, it wouldn't require massive subsidies from the federal gov't.
    The chevy volt will be the Edsel for the new millenium. Count on it.

    • Raymond in DC

      One should assume that every estimate for an electric car's range is optimal and does not take into consideration the impact of hills, climate controls (heater or air conditioner), audio system, etc. Call them "best case" or "in your dreams" fantasies.

  • topeka

    As for dumping our current, actual mass transit system of individual motor vehicles in favor of socially engineered society…. really? I mean – have any idea what is being suggested? Somehow I suspect one believes one will always have a ride (Oh wonderful Eloi) – probably paid for by schmucks like myself – while we schmucks (Morlock's) have to ride the cattle cars to the mines to make the Eloi's dystopian (and self destructive) dreams come true.

  • Wes in MT

    He's a jack alright, but not of 'all trades', just a 'jack ass'.
    If the environuts would just once let us be like France where it counts, we could easily supply all our electricity needs with hydro and nuclear. And waste would not be an issue if we would reprocess the fuel. Honestly, to anyone who thinks a little bit, the goals of the hard left environuts are not for our good. As for electric cars, great on the golf course or maybe around town, but I would not want one on a cold winter day with 600 miles to go in the northwest.

  • Wes in MT

    I would challange everyone to rethink the assertion that oil is a "fossil fuel". http://www.oilgeopolitics.net/Geopolitics___Euras
    Interesting reading and makes a lot of sense, especially when you consider that the sheer vastness of the quantity of organice matter needed to come anywhere close to the oil already extracted over the last 100 years borders on the absurd.

  • minnieiam

    This is a perfect example of central planning. Build stuff nobody wants because some pointy headed "expert" thinks it's a good idea. .

  • Raymond in DC

    What's often overlooked in this debate is how alternative fuels vehicles epitomize a centralized or decentralized model.

    Vehicles in which one generates energy on the fly using contained fuels – gasoline, natural gas, clean diesel, hydrogen, etc. – are decentralized, independent and untethered. They are liberated, free and independent. It's no wonder America took to them so readily.

    Electric vehicles are "tethered", as the energy is generated elsewhere, even as in the Better Place model where one swaps in a charged battery pack when one's run low. We rely on others for new transmission lines, smart grids and charging stations, new power facilities (whether legacy or "clean"), and so on. All these are more in keeping with control economies. Only be adding a secondary power plant (the hybrid model) can one gain a measure of "freedom".

  • Papa Bear

    I don't like government subsidies, I don't believe in global warming, I think the Volt will cost a lot more than any potential savings in gas, but I am looking forward to buying one. I will pay extra (within reason) to reduce my use of oil which goes to support Islamofascism, Venezuelan communism and Russian totalitarianism. Any upscale vehicle has some emotional or irrational fees built in to it. A Cadillac Escalade is just a Chevy SUV with $10,000 worth of extras that costs $20,000 more for the cache of the brand name. Stop using OPEC and Russian oil now!

  • pyeatte

    For electric propulsion, hydrogen fuel cells are by far the best bet. Hydrogen can be fueled quickly, like gasoline, without the charge time for batteries. Also range can be several hundred miles. It is possible to have hydrogen generated at the filling station instead of the trouble and problems of transporting. Batteries, with todays technology, is dumb for transportation. The limitations of batteries are based on chemistry and physics, and coming up with a True breakthrough, well, don't count on it.