GM and Fiat Chrysler Unmasked As Tesla's Secret Source of Cash (bloomberg.com) 227
For years, Tesla has hauled in revenue by selling credits to other carmakers that needed to offset sales of polluting vehicles to U.S. consumers. While these transactions have largely been shrouded in secrecy, Bloomberg reports that General Motors and Fiat Chrysler have recently disclosed to the state that they reached agreements to buy federal greenhouse gas credits from Tesla. The filings "represent the first acknowledgments from carmakers that they're turning to Tesla for help to comply with intensifying U.S. environmental regulations," the report says. From the report: The deal with GM will come as a surprise to those who thought years of sales of plug-in hybrid Chevrolet Volts and all-electric Chevy Bolts would leave the largest U.S. automaker in the clear with regard to regulatory compliance. But while sales of those models have put GM in a position where it doesn't need extra credits today, demand for its battery-powered vehicles are dwarfed by its gas-guzzling trucks and SUVs. And the company wants to bank the credits for future years when emissions rules get tougher -- especially if a Democrat beats President Donald Trump in 2020.
The filings don't give specific terms of Tesla's credit sales to GM or Fiat Chrysler, whose past purchases of credits haven't been disclosed directly but could be inferred from U.S. Environmental Protection Agency reports. GM's agreement to buy greenhouse gas credits was dated Feb. 25 and reported to Delaware the following day. Pat Morrissey, a GM spokesman, said the company is buying the credits as insurance against "future regulatory uncertainties." Fiat Chrysler disclosed agreements to buy credits from Tesla that were reached in 2016, 2018 and earlier this year, in four separate filings. Eric Mayne, a spokesman for the Italian-American automaker, said U.S. standards are getting stricter at a pace that "far exceeds" the level of consumer demand for electric cars that is required for compliance. "Until demand catches up with regulatory requirements, and there is regulatory relief, we will use credits as appropriate," Mayne said.
The filings don't give specific terms of Tesla's credit sales to GM or Fiat Chrysler, whose past purchases of credits haven't been disclosed directly but could be inferred from U.S. Environmental Protection Agency reports. GM's agreement to buy greenhouse gas credits was dated Feb. 25 and reported to Delaware the following day. Pat Morrissey, a GM spokesman, said the company is buying the credits as insurance against "future regulatory uncertainties." Fiat Chrysler disclosed agreements to buy credits from Tesla that were reached in 2016, 2018 and earlier this year, in four separate filings. Eric Mayne, a spokesman for the Italian-American automaker, said U.S. standards are getting stricter at a pace that "far exceeds" the level of consumer demand for electric cars that is required for compliance. "Until demand catches up with regulatory requirements, and there is regulatory relief, we will use credits as appropriate," Mayne said.
This is one way to get rid of taxes. (Score:4, Interesting)
Why should a government get the money for a carbon tax? They'll just blow it on buying votes from poor people.
It's better that a market-responsive organization like Tesla is getting the money.
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Why should a government get the money for a carbon tax?
Most proposals for a carbon tax are revenue neutral. So the carbon tax would replace other taxes.
If carbon taxes replaced payroll taxes, we would be disincentivizing fossil fuel consumption rather than disincentivizing work and hiring. Seems like a win to me.
They'll just blow it on buying votes from poor people.
1. They can do that regardless of the source of funds.
2. Most poor people don't vote. It is better to buy the votes of rich people.
Re: This is one way to get rid of taxes. (Score:4, Informative)
Black people make up 40% of voting Democrats.
You're way off. It's more like about 21% or 22%. Google it.
They're very easily bought off and tricked with promises of free stuff and photo ops of politicians eating watermelon and hot sauce.
Alas, many voters, regardless of race, can be beguiled by politicians who lie to them. The current occupant of the WH is an extreme example.
Citation: All 2020 Democratic candidates, and Hillary.
That's not a citation. It's just innuendo you pulled out of your ass. Show me one -- just one -- example of a Democratic presidential candidate, past or present, eating "watermelon and hot sauce" to pander to African-heritage americans. I'll wait.
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*Sigh*. You're right. I shouldn't. But it was the watermelon thing that set me off.
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it was the watermelon thing that set me off.
The watermelon thing is nonsense anyway. The biggest consumer of watermelons is China. Go to China in the summer, and you will see watermelons for sale on every street corner, and watermelon juice is the default summer drink to cool off. The next biggest consumers are Turkey, Iran, and Brasil. Africans are way down the list.
Disclaimer: I love watermelon.
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Ad hominem attacks are an invalid counter argument to posted information.
Please go back and and provide research before posting again.
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Parent poster (emphasis mine) :
example of a Democratic presidential candidate, past or present, eating "watermelon and hot sauce" to pander to African-heritage americans.
The asked example wasn't of any candidate just randomly eating hot sauce, but doing so for the specific purpose of attracting black votes.
Here's Hillary: https://www.theatlantic.com/po... [theatlantic.com]
From your own source (including citing their own source for the info) :
Apparently she's been a
CAFE (Score:5, Insightful)
This is one of the dumbest regulations in the country. If you want more fuel efficient cars INCREASE THE TAX ON GASOLINE. Instead you have this insane law that makes car companies trade "credits" and build unprofitable cars so they can build profitable cars.
When you want people to smoke less you don't regulate the size of cigarettes, you make them more expensive.
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Cars have done incredible improvements on mileage in the past 15 years or so. Your average SUV can get near 30MPG on the highways. Hell my car has a V8 and gets 26MPG.
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Hell my car has a V8 and gets 26MPG.
My 1986 IROC could get about that on the highway. Whoopeeshit. So does our 3/4 ton cargo van, but admittedly it's a Sprinter with a 2.7l diesel.
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Your IROC got 23MPG. [fueleconomy.gov]
And probably weighed half as much as a modern car.
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I don't care why it is or isn't better. And I got better than the rating on the freeway. It wasn't too horrible in town either, THAT may have been due to weight.
My 1982 300SD gets nearly 30 on the highway, and does great around town, too. But it's well known as a special case. The aero is actually good by modern standards.
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It's very debatable than "heavier == safer". Physics doesn't lie and F = m * a
Not only are collisions going to have more force, but required braking distance will be massively increased. Cars likely handle alot worse as well.
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but required braking distance will be massively increased. Cars likely handle alot worse as well.
Wrong, and wrong.. Car breaking distance, despite being heavier is down (brake size and quality has increased), and handling? Are you joking.. look at skidpad and slalom results from now and from then, run of the mill vehicles are
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Modern cars also tend to be much heavier than older ones, which offsets a lot of the efficiency gains...
Modern cars are fitted with lots more equipment that simple weren't present on older cars. If you were to take a lightweight basic model old car with virtually nothing aside from the most basic of features, and fit a modern engine into it you'd likely get very good fuel economy.
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Is that US gallons or Imperial (British) gallons ? It is easier to get 80mpg when the volume is Imperial (British) gallons than the smaller volume of US gallons.
1 Imperial (British) gallon = 1.20095 US gallons
You can blame the US War of Independence for this difference in the volume of a gallon because after independence, a British Weight and Measures Act of Parliament changed the definition of a gallon but the US did not enact this change due to being independent.
Therefore, cars in the UK always have a bet
Re:CAFE (Score:5, Insightful)
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The Free Market Solution to pollution is to ignore it, forcing the people it affects to bear the consequences and ultimately the taxpayers to pick up the tab to fix it.
Then the people impacted by the problem get together and vote for politicians who will act in their interest by creating laws and regulations which force the issue.
So really, government regulations are a natural consequence of free market capitalism; The market has spoken, they just decided to voice themselves at the ballot box instead of wit
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That would just make driving too expensive for poor people.
Better to do something that encourages the development of better, affordable cars.
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This is one of the dumbest regulations in the country. If you want more fuel efficient cars INCREASE THE TAX ON GASOLINE. Instead you have this insane law that makes car companies trade "credits" and build unprofitable cars so they can build profitable cars.
When you want people to smoke less you don't regulate the size of cigarettes, you make them more expensive.
I understand that a gasoline tax unequally effects people of lower classes than those of middle and upper class who can easily handle the likely tax increases.
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That doesn't change the affordability of the tax.
"Both a rich man and a poor man can go out today and buy a yacht" doesn't mean a whole lot when only one of them actually has the money to do it.
Re:CAFE (Score:4, Insightful)
The poor then drive less because they cannot afford it
ProTip: The poor are already driving as little as they can while still remaining employed and not-homeless. Which is why this "raise the gas tax" model doesn't work - if they have no alternatives to paying more, they just pay more.
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The real reason the gasoline tax isn't higher is because the oil companies don't want it any higher.
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You don't seem to have checked your math to see if your claims were right.
In the story, the credit came from a company that does profit building more efficient cars, and were sold to another company.
None of the companies involved are building unprofitable cars to meet their requirements.
Re:CAFE (Score:5, Insightful)
None of the companies involved are building unprofitable cars to meet their requirements.
GM and Ford both build unprofitable compact and sub-compact cars to meet their CAFE requirements. Source: the two dozen people I know who currently and have worked for both Ford and GM in the last 30 years.
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And they are not selling, which is why they are purchasing credits from Tesla.
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Indeed. One can see US EV sales over at InsideEVs:
https://insideevs.com/news/352... [insideevs.com]
Tesla sells a literal order of magnitude more than the "competition".
Re:CAFE (Score:4, Insightful)
Wow, excepting every single day for the past decade, I've never heard about these notions of Tesla being crushed by legacy automakers "any day now" and "Tesla killers just around the corner"!
While most automaker margins on EVs range from "minimal" to "large losses", Tesla consistently returns ~20% margins on its vehicles. The fact that they're constantly reinvesting the money to grow at ~50% every year rather than sitting on their laurels and paying dividends is immaterial, as is quarter-to-quarter noise.
Sounds like its working! (Score:2)
So, small, fuel-efficient cars that otherwise wouldn't exist now do! And are sold! That sounds like the exact goal of CAFE standards.
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Pure incompetence. Lots of other manufacturers manage to make cheap, efficient cars and profit from them.
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"but I know people you don't" is not something that implies knowledge.
If you claim to have played a game of "telephone," where somebody whispered in your ear, and their job implies somebody whispered in their ear. and at the start of that line of whispering was somebody who had accurate information, then you have no claim to accurate information.
If somebody else attempted to think about it themselves, they have some chance of understanding it.
If you were to simply read the available information, you'd find
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Except Tesla isn't profitable. They need to build something boring for that. The R and D costs for everything that came after the roadster have been too high. Probably the pickup will qualify. You can grossly overprice pickups. Average transaction price on pickups is over sixty K.
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You seem a bit confused by numbers.
Look up the cost of making the car, and the sales price of the car. That will tell you if the product is profitable.
You can't tell anything about one product vs another product by looking at the company's bottom line. The company didn't do just one thing, they might have done other things too.
You do understand the difference between talking about a specific product and talking about a company... right?
Re:CAFE (Score:5, Insightful)
When you want people to smoke less you don't regulate the size of cigarettes, you make them more expensive.
We tried that. It only caused the people on the edge to stop smoking. The others just paid more.
We also saw the same thing with increases in gas taxes. It didn't reduce gas consumption much because people still had to drive to work.
Given our country's terrible public transportation and fetish for zoning for low-density and parking, raising the gas tax isn't going to change behavior much. Because there's a lack of alternatives.
Also, there's a bit of a problem making people have to go out and buy new cars to deal with your sudden spike in gas prices. Not exactly an option for a huge percentage of the population. As well as really dumb for those who can afford to buy new instead of used.
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Smoking taxes don't work well because they don't address addiction. But we're not addicted to SUVs. When fuel prices go up, people buy less large vehicles, and more EVs.
As for the people who buy new cars, CAFE makes them either buy an efficient car, or subsidize efficient cars. It only takes maximum a few years to pay back the energy investment of a new car, and the fleet is aging (the median age is now over eleven years) and that wealthy person will also sell their old vehicle, which will replace something
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Smoking taxes don't work well because they don't address addiction. But we're not addicted to SUVs. When fuel prices go up, people buy less large vehicles, and more EVs.
And as I said above, the people who can actually afford to go buy a new car right now have the means to just pay more for gas. So it doesn't have much effect. We saw this with gas prices going up due to oil prices going up. It shifted demand a little, but not nearly as much as the increase in price would predict.
and that wealthy person will also sell their old vehicle, which will replace something older and even less efficient being driven by someone poorer.
It is unlikely that the person who has the wealth to buy a new car on a whim is currently driving a car with maximum fuel efficiency in mind. In the current market, they're probably driving a lu
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Perhaps the people who are well and truly addicted would just have to pay more, but it is an enormous incentive for those who are "entering the market" for the addictive product. And it is possible for most to quit, eventually.
Likewise, the solution to better fuel efficiency is discourage fuel use. Perhaps some poor will be screwed, but 5-10 years down the road, that demographic will be able to buy used fuel efficient vehicles. So the proposed gas tax solution does work, albeit we perhaps should mitigate
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That just isn't true. When gas was more expensive people did buy more fuel efficient cars and also drove less miles. When gas became cheap again, the reverse happened.
The "Just raise gas taxes!!" model predicts a massive shift in demand. What actually happened was a small shift in demand.
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It moves by minute amounts, not massive shifts.
Gas prices may jump, but the blip in sales of more fuel efficient cars is but noise in the year's car sales.
Ditto for miles driven. They go down, but not because of anything economic. The public drives less because they cut out a lot of elective driving. Instead of making multiple trips, they make
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But isn't that sort of the same situation here?
Yes, it makes lower-efficiency cars more expensive and subsidizes higher-efficiency cars. That way someone who is cash-constrained could buy the cheaper, more efficient car because it exists.
(I'm talking CAFE standards in general, not literally buying a Tesla instead of a Tahoe since Tesla is still a luxury brand)
We're also not harming the people who have already cut their driving to the minimum because of fuel costs, because the cost/subsidy for CAFE is at vehicle purchase time instead of every time they
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If you want more fuel efficient cars INCREASE THE TAX ON GASOLINE
That's not an option because anyone who enacts that will get voted out of office. So come up with something reasonable.
The question is, what if you want more fuel efficient cars without increasing the tax on gasoline? What do you do?
Re:CAFE (Score:4, Insightful)
Yeah, it's almost like America has been mocking almost EVERY OTHER COUNTRY in the world (with the exclusion of certain oil-producing states) that have been doing that for decades.
Now they're shocked that if you keep it cheap, people just keep burning it and find ways to continue to burn it for ever and ever and ever and... whoops, we ran out!
Of course the tax on fuel is "artificial" profit... all taxes are. You tax what you want to discourage, while subsidising what you want to encourage. Allowing someone to effectively "sell" their subsidy to someone who would be taxed otherwise, cheaper than the tax costs them, is one of the most ridiculous things I've ever heard.
If you tax and subsidise properly, the consumer has an incentive not to use bad products and an incentive to use better-than-average products too - double whammy, and you get paid *both ways*... either by tax, or by actual take-up of what you need so that you as a country don't have to go trading carbon credits (which is also a thing on an international scale).
Plus, a tax on the raw fuel is a) hard to avoid (not impossible, but easy to legislate that the average consumer can't avoid it), b) directly proportional to usage and efficiency of their device (little old grannies pay little, state-crossing juggernauts pay a lot more), c) easy to administer (you just make the fuel companies send you a percentage of their profits on a certain product).
That's why European and other countries have been doing that *forever*.
Maybe, just maybe, some day the US will realise the "real" cost of fuel, which includes things like it's environmental impact, damage to people's lungs (especially diesel) and general health, and rarity.
Re:CAFE (Score:5, Informative)
Yeah, it's almost like America has been mocking almost EVERY OTHER COUNTRY in the world (with the exclusion of certain oil-producing states) that have been doing that for decades.
Yeah, it's almost like Europeans don't quite understand the complexity of the issue, and then write posts about how superior their approach is when they are in a totally different environment.
For example, you folks actually have functional mass transit, so there's alternatives to driving. We don't. The result is people who are price-conscious about fuel are already driving as little as possible. Higher costs don't make alternatives suddenly appear, and they still have to get to work every day.
Fix the mass transit? Well, that gets into the problem of how we've built our cities compared to European cities. Since the vast majority of the growth of US cities happened after cars, we didn't build to the same density as European cities. And we demanded lots and lots and lots of parking to handle all our car-based travel, driving density down even more. We also built office, commercial and industrial areas kinda willy-nilly, so the commute in each city is mostly random suburban house to random suburban workplace instead of most people commuting to "downtown" or similar concentrations.
So now outside the "old" cities like New York and Boston, we don't have the density or common destinations for practical mass transit and people who respond to fuel prices already minimize driving. Which means your "Just do what the Europeans do" comment actually means "Tear down and rebuild all of the cities that are not in the Northeast Corridor". For some reason, we find that a tad impractical.
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Or we could start capturing the externalities in fuel tax and the market would slowly correct the problem.
Only if you're operating under the illusion that a Wal-Mart cashier has plenty of extra cash to put into their fuel tank.
Again, we lack alternatives and punishing the poor because the rich want low-density zoning is not a good way to fix it.
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I agree. But since the US seems structurally incapable of increasing gasoline taxes.... ;)
Out here, gasoline usually costs what's equivalent to $7-8/gal US. Also, cars have 26% VAT (waived up to certain thresholds for EVs), plus various emissions fees (which on a gasoline or diesel car can raise the total percent up to 40% or so). Needless to say, EV adoption is taking off. But there's reasons for wanting that. Beyond global issues like climate change, as well as polluting the air we breathe (and often wa
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This is one of the dumbest regulations in the country. If you want more fuel efficient cars INCREASE THE TAX ON GASOLINE. Instead you have this insane law that makes car companies trade "credits" and build unprofitable cars so they can build profitable cars.
When you want people to smoke less you don't regulate the size of cigarettes, you make them more expensive.
Two things here:
1) The point of a system that aids the building of unprofitable things is to kick off an economy of scale that in time makes the thing profitable.
2) The government doesn't want people to smoke less. They want people to be able to smoke without getting cancer because the entire economy of the country is highly dependent on smoking without any infrastructure for a smoke free economy to function. As such increasing taxes on smoking has the direct effect of taking money from the very people who
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". If you want more fuel efficient cars INCREASE THE TAX ON GASOLINE. Instead you have this insane law that makes car companies trade "credits" and build unprofitable cars so they can build profitable cars."
Part of what we wanted was cars with lower emissions, and Obama altered CAFE in 2012 to reflect that fact. EVs have the lowest emissions (yes, even when accounting for production, especially since the US fleet is continuing to age) so we wanted to promote them. Trading credits achieves that.
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In New Zealand we already have similar taxes for diesel vehicles, they don't get taxed on the diesel but rather pay a "Road User Charge" which is based on distance travelled.
The future plan is to extend this to EV's when it is a significant portion of the national fleet. Until then, they get a free ride.
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Shouldn't there be sources at various marinas for tax free fuel for boats?
You should be paying road taxes on your truck, SUV, motorcycles (if they're road bikes) and RV.
The larger they are, the more damage they do to the road. Road damage increases approximately with the cube of the axle weight.
A bigger car may use 2x the fuel of a car half the weight, but it does 9x the damage to the road.
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A car being bigger doesn't necessarily mean it does more damage to the road...
Wider tires spread the weight across more surface area, while many highend cars are made of lighter material than cheap cars so the weight different often isn't so big.
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Damage isn't caused by surface area and pressure density on the scale of a tire contact patch.
It's caused by the flexing of the road surface by the weight of the vehicle passing over it.
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Also in europe, more fuel efficient cars are a big selling point and car manufacturers compete on this basis. The vehicles on european roads look very different to american ones.
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LOL. Roll some coal brothers.
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We're still ok with being known as Americans.
I"m guessing you're not from here, as that no one here would know WTF a "USian" was if you tried using it in normal conversation.
This was a surprise to... who? (Score:5, Insightful)
Everyone who tracks the automobile industry knew that all the major players - including but not limited to GM and FC - were using credit purchases from Tesla as part of their fleet CAFE management strategy.
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Indeed. Came here to ask how it could possibly be a surprise. These are all publicly-traded companies. Aren't transactions like this supposed to be on the books for the shareholders to see?
Tesla gets coal credit? (Score:2, Funny)
Most American power comes from coal and nat gas. There are some wind and solar farms but a vast majority comes from coal or nat gas so we are giving credits for coal powered cars?
Cool!
Re:Tesla gets coal credit? (Score:5, Interesting)
Considering that a power plants have huge sets of step-down steam turbines (CCGT) and stack scrubbers, it's still wildly preferable to burn fossil fuels there than in tiny 2-3L internal combustion engines.
First, the thermal efficiency is fantastic -- these plants really extract the maximum thermal energy into electricity. Compare that to a car engine where you have one combustion then the rest of the hot gas goes out the back, it's not even close. Even after transmission/battery losses, the Tesla is getting more miles out of each BTU than the equivalent ICE.
Second, the scrubbers and other anti-pollution devices can be far more extensive and heavier than the catalytic converter on a car. For NOx and SOX pollutants especially, the plants achieve far better numbers than a car for the same energy output.
So yeah, even a "coal powered Tesla" is better than an ICE, with the added bonus that as your grid gets better, it improves for free.
[ None of this is to suggest that coal is a good idea. But the perfect is not the enemy of the good and all that. ]
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The yearly emissions test I all you have to combat this. You just can't have the control you get when everything is concentrated at a single point..
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so we are giving credits for coal powered cars?
Yeah because every study has shown that coal powered cars are better for the environment than oil powered ones. And no I'm not being funny, just pointing out while you were aiming to be a sarcastic git, you actually produced an intelligent post.
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The thing with Electric Cars, is that it is easier to replace a power plant, then to replace millions of cars. So while your Electric car may come from less then green power, while these coal plants are being replaced by Natural Gas, which is much cleaner and cheaper then coal is. As well the growth of Solar and Wind powers we can create greener technology.
Technically the ideal infrastructure for Electric cars, is your home will have solar panels, with battery storage, which then charges your car overnigh
Re:Tesla gets coal credit? (Score:5, Informative)
"Most American power comes from coal and nat gas"
The source you provided:
Natural gas 1,468 35.1%
Coal 1,146 27.4%
That's 62.5% from coal and nat gas. Seems pretty factual to me. Significantly more than half and over 3x more than second place counts as "Most"
The next highest is nuclear at 19.3% and renewables at 17.1%
Great laws (Score:3, Interesting)
So, to be clear, disincentives for polluting are meaningless because there's no demand -- hence the disincentive to the manufacturer.
But the manufacturer can buy credits cheaper than the disincentive, so there is no disincentive.
Bad enough that they can be traded like baseball cards. But they can be banked too? I'm so happy.
And we all knew Tesla was out of money. Now we know that they have been getting free money based on a broken set of laws? Excellent.
So if the disincentive goes away, Tesla goes bankrupt instantly. And if the disincentive gets bigger, then the banked credits make it completely meaningless. And if the credits are voided, then everyone sues.
What a great set of laws you've got there. Way to achieve an objective.
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So if the disincentive goes away, Tesla goes bankrupt instantly. And if the disincentive gets bigger, then the banked credits make it completely meaningless. And if the credits are voided, then everyone sues.
What a great set of laws you've got there. Way to achieve an objective.
It achieves the objective perfectly.
Rich environmentalists get to preen and show off their Teslas, Tesla fanboys get to feel superior even though they can't afford one (even with the subsidies), we all get to hate on those wascally wepubwicans and feel superior, and most people still get to buy the ICE vehicles that they really want that actually have range and can carry heavy stuff and have room.
Oh, you didn't mean those objectives?
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You think being forced to give money to your competitor to develop their own competing products is not a disincentive?
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They aren't being forced, and they aren't competitors. They are choosing to pay less to a tiny ankle biter instead of paying more to a government body. And the day that they choose to stop, that ankle biter will have absolutely nothing left on which to survive.
Tesla has failed in every business category -- making money, selling cars, spending money, advancing design, increasing options, building infrastructure. Teslas don't have any more features (that actually work) than a typical Ford does. They are s
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The objective was to have fewer gas-powered cars, in order to have less pollution.
Hey look, more cars, more SUVs, more trucks than ever before -- and oh look, more pollution!
It's no wonder you chose to avoid putting your name to your argument.
Volt vs. Prius (Score:4, Insightful)
I can see the position that GM is in, the market wants the big trucks, even if they can't meet the much tougher passenger car safety standards.
The volt should counterbalance that some; but, frankly it isn't that attractive. It costs more than the Prius and lacks any compelling reason for its purchase, in most cases. GM is in a position that they could take over the electric car industry and leave Tesla a footnote in history. However, that would require real long term planning, something the American auto industry has never been noted for.
Re:Volt vs. Prius (Score:4, Interesting)
The volt is a commuter car, and fills that role well. The people that I know that have one, love it and would not give them up willingly. Yet, they are no longer going to produce them any more.
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It's a niche market, and not a profitable one. So it goes "bye bye". No, the future is plug-in hybrids.
This statement has a minor problem: The Volt was a plug-in hybrid.
I own a Volt, and it's got a worst-of-all-worlds problem.
The electric range is poor because it's got to carry around a gas engine and all the associated equipment, so there's not enough room for a decent-size battery pack (range is about 25-30 miles winter, 35-45 miles summer). The gas engine is not terribly powerful because it's gotta be small to make room for the batteries and electric motors. The transmission is far more complex than nec
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Dealers hate the Volt (almost as much as they hate the Bolt). These cars need almost no service compared to everything else the dealer sells
Yeah, I've got a Volt. This isn't exactly true. When I've had to take it in for anything more complex than an oil change or tires, I've had to take it to the dealer because no third-party mechanic can figure out what the hell the car is doing. And then the dealer can't figure out what the hell the car is doing.
I could take a Silverado to anyone who can hold a wrench.
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GM is didn't actually need the credits in the past year. They got them as a hedge for the future.
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People used to want big cars. But then the government passed the CAFE standards [wikipedia.org] in 1975, forcing automakers to make cars small. So buyers looked around, and discovered a niche light truck called a sport utility vehicle (popular with off-roaders) was still big. Light trucks fall into a more lenient CAFE category, so SUVs could still be made big. If you look at the [epa.gov]
Times up (Score:2)
So they have enough sales to not require credits. How long till they have enough banked credits to reduce risk to acceptable levels?
Who's going to buy Tesla's credits and keep their cashflow up?
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GM didn't even require the credits last year. They were hedging for future years.
AKA, GM thought Tesla was undervaluing an asset, and bought it.
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Or GM thinks Tesla isn't going to last much longer, so it's buying them now while they're available.
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Who's going to buy Tesla's credits and keep their cashflow up?
Tesla gets billions in cashflow from selling cars, and tens of millions for selling carbon credits. If the credits dry up it's not fun, but also not disastrous.
Why is this even a thing? (Score:2)
The companies that produce gas guzzling SUVs and pickup trucks and other massive things shouldn't be able to get away with it just by buying some credits from those companies that are actually building the cleaner less polluting cars of the future.
If GM or Ford or FCA or VAG or the like want to keep making the SUVs and pickup trucks they have to either make a lot more of the smaller more fuel efficient cars to offset those or they have to drastically increase fuel efficiency of the SUVs and pickup trucks t
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It's just outsourcing the creation of those other vehicles. I mean, does it matter if Ford makes 1 million n trucks and 1 million bicycles or 1 million trucks and subsidizes Huffy so they sell 1 million bicycles? Either way, the market is 1/2 trucks, 1/2 bicycles.
Shell game (Score:3)
So Tesla sells boutique vehicles to rich people who want to show how oh so enviro they are, while the real car companies still same the same old vehicles to the rest of us.
Everybody wins! (Er, give or take some externalities and actual environmental effects)
And you all thought ... (Score:3)
Deregulate (Score:2)
Perhaps the reason we have a regulation-busting president is *because* the people are tired of having the government meddling in the fuel efficiency of automobiles (and everything else). "Government is not the answer to our problems; government *is* the problem."
Just let the industry work it out for itself. Regulations only make the problems wors
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It's a fleet efficiency target.
Re:Electric demand or fuel efficiency requirements (Score:5, Insightful)
It's a fleet efficiency target.
Just want to point out that these top-down mandate schemes have an extremely poor track record. The first CAFE standard exempted light trucks, which includes SUVs. So instead of switching to an efficient sedan with 10% better mileage, there was a massive shift to 4 ton SUVs that got 100% worse mileage.
The new standards try to fix some of the problems, but are complex and difficult to measure and monitor.
A straight carbon tax would work better. But that is unpopular because the cost would be visible rather than hidden.
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What would work better is not exempting light trucks. Suddenly they would be the more expensive option again, and only people who needed them would buy them. Of course, if you changed that today you would impact the auto industry even more than you were trying to, as people would put more energy into keeping their old trucks running. You would also absolutely murder non-diesel pickups. The difference in mileage isn't even funny. Might even bring back pickups with small diesels that way. My car has just been
No, it's because regulators don't have a clue. (Score:3)
Its not about polution and environment...
It's about making company more profit.. they switched to SUV because they look big so they can make it more expensive.
No, they switched to the SUV because people with large families or homes far from town, thus needing space for many passengers and large shopping loads, couldn't get a station wagon any more, because the manufacturers had to drop them to meet CAFE fuel standards. So they switched to the smallest thing that was a "truck" for the regulations.
Of course
Re:Electric demand or fuel efficiency requirements (Score:4, Interesting)
I remember a while back GM has bought Club Car (Golf Cart Makers) to raise the fleets Fuel efficiency percentages. They actually took Thousands of these golf carts and made them technically road legal. By boosting the power output so they can drive at highway speeds, and added extra safety equipment. While technically for sale, no one bought them, but they just kept them in inventory to keep the fleet at the fuel efficiency rate they wanted.
The problem is there is are too many people following the Letter of the Law while opposing the spirit of the law. Then they get all huffy when the laws need to be rewritten more exactly.
Much of this government over regulation is because too many companies and people are not trying to follow the rules in good faith.
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PayPal is not a bank, so any fraud would have to be non-bank fraud.
I know they're not a bank, because when they bought X.com they closed all the bank accounts. Bastards.
Re:What a scam (Score:5, Informative)
These credits have always been on Tesla's balance sheet (just not the source) - "non-ZEV credit revenue". They're dwarfed by actual sales revenue. Non-ZEV credit sales are generally in the tens of millions. Automotive revenue is generally in the 5-7 billion range, depending on the quarter and what aspects you count.
The only "news" here is finding out who is buying credits. But of course it's being spun as if the existence of credit sales is new, and as if it's actually some huge part of Tesla's total revenue. Also, the fact that Fiat is one of the two companies is totally unsurprising, as Fiat is Tesla's EU pooling partner.
The whole purpose of creating a credit system is to force automakers to make clean vehicles. If you don't want to comply with legislation to make clean vehicles, then you should expect to have to pay for your lack of compliance - it's really that simple. Your alternative is to actually make the clean vehicles your government wants you to - do so, and you don't have to pay anything.
Legislation that includes "trade" mechanisms allows companies to buy excess credits from other manufacturers, generally costing (far) less than they'd have to pay from the government. Contrarily, the (new) mechanism in the EU allows one to establish "pooling arrangements", so a manufacturer that needs more credits can pool with one that has excess and be treated as a single regulated entity.
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I waver on whether I feel it makes sense or not. The concept is that you control how many clean vehicles get produced (via your credit requirements) and leave it up to the industry to balance out who makes what in the most economically-efficient manner possible. But in this case, for example, Tesla is going to be making BEVs regardless, so....
But I guess it's still an incentive for the "old guard" to clean up their act?