I recently came across a report written by the Congressional Budget Office (CBO) which estimated the cost to taxpayers for “federal policies to promote (aka subsidize) the manufacture and purchase of electric vehicles (EVs).” The piece also predicts the short-term benefits of the subsidies and includes the effects of rising federal requirements for fuel economy (known as CAFE) standards. The outlook is that federal subsidies will cost taxpayers $7.5 billion over the next few years for little or no benefit (even when including the impact of CAFE) to total gas consumption or emissions.
The CBO is a non-partisan federal agency that is relied upon by Congress to provide unbiased economic data. Unfortunately, Congress does not seem to listen to what the statistics are telling them. In the case of green subsidies, it seems that no logical data on how little the country benefits from the politically-popular handouts and how many … Read More ➡
General Motors finished 2012 with a 17.9% market share in the US and is expected to repeat the performance in 2013 according to a Bloomberg report. The number is at the lowest point it has been since 1924. So what is behind the dismal numbers at GM that sees the company performing at 88 year lows?
Before speculating on why GM has lost so much market share to the competition, I must point out the technicality that the company has actually only been in existence for 3 1/2 years, so we are comparing market share to “Old GM.” “New GM” came into existence in June of 2009 after it filed for bankruptcy and reemerged as a company that was majority-owned by the government. Since then, GM proponents will point to historical performance comparisons to Old GM when convenient (as if the bankruptcy never occurred) even as they absolve themselves … Read More ➡
The final tally is in for 2012 Chevy Volt sales. The good news (which is what most headlines will trumpet) is that sales for General Motors’ flagship green vehicle tripled from 2011’s paltry 7,671 to a slightly less paltry 23,461 in 2012. The bad news is that the number is almost half of GM’s sales goal of 45,000 in 2012 for the Volt. The further bad news is that the Volt has so little demand in most regions that some dealerships are refusing to pay for required tools to repair the vehicles and are choosing to cease selling the vehicles instead.
To put the sales figures in perspective, Toyota’s hybrid Prius family achieved sales of 236,659 in 2012; over ten times that of the Volt! You wouldn’t know that from the amount of hype the Volt has gotten compared to the Prius. Furthermore, taxpayers had to foot the bill for … Read More ➡
The past year was a dismal one for the passé idea that government would use taxpayer dollars responsibly, and that was nowhere more evident than with President Obama’s initiatives to promote “clean” energy technology companies and projects with so-called “stimulus” funds and other public money. NLPC reported extensively on some of the most egregious examples.
Solar Favors Don’t Stop Fizzle
Solyndra went bankrupt in 2011, and the reverberations over $535 million in lost taxpayer money were felt throughout 2012. Money still flowed out from the Department of Energy and its stimulus stash, but Congressional Republicans’ scrutiny of big projects – especially in the Loan Program Office –paralyzed some new projects.
The year began with BP, which not long ago downplayed fossil fuels in favor of a “Beyond Petroleum” motto, exiting the solar business despite having received a $7.5 million grant from the U.S. government … Read More ➡
General Motors moved quickly to complete its buyback of 200 million shares from the US Treasury Department before year end. It is a welcome sign that the Obama Administration is finally beginning to exit taxpayers’ GM stake, a move that could have been made a year and a half ago when share price was closer to $30. While some felt it was never the place of Government to gamble taxpayer money on Wall Street by market timing the exit of Treasury’s GM stake, others argued that taxpayers would be better served by waiting until GM share price rose to at least over the $33 IPO price of two years ago.
Of course, the presidential election affected the politically-sensitive decision as well, as no one in the Obama Administration would suggest locking in losses for American taxpayers prior to Election Day. Now the question must be asked, what drove the decision … Read More ➡
Let’s all rejoice! The Treasury Department is finally beginning to unload the taxpayers’ stake in General Motors after a three and a half year stint of government involvement in the company. While the decision to get taxpayers out of the private sector is the correct one, the move is hardly a cure-all for what ails GM. And despite reports to the contrary, this does not bring closure to all groups that were involved in the unprecedented intrusion of government into the private sector that saw politically-powerful groups like the UAW receive favorable treatment over other classes.
Let’s start by reviewing the GM buyback deal that was just announced. Of the $50 billion or so of taxpayer money that went to GM, about $40 billion went towards the purchase of approximately 800 million shares of stock in “New” GM. That comes out to roughly $50 a share paid by taxpayers. GM … Read More ➡
A top Nissan official has said the company was “arrogant” in its marketing and sales approach for the all-electric Leaf, which received a $1.4 billion stimulus loan guarantee from President Obama’s Department of Energy.
Not that the company is going to return taxpayers their money, since the premise upon which Nissan received the loan were ridiculously high production estimates. Too much in expenses would have to be eaten otherwise.
“We were a little bit arrogant as a manufacturer when we went to the 50-state rollout,” said Al Castignetti, Nissan’s vice president for sales, to Automotive News in late November. “We had assumed that there were people just waiting for the vehicle who would raise their hand and say, ‘Give me a Leaf, give me a Leaf, give me a Leaf.’”
Considering there weren’t many people “raising their hands” in the few states where Nissan did roll out the … Read More ➡
It would appear that there is a bit of a Mexican standoff regarding the sale of General Motors stock by the three major holders. The US government (aka taxpayers), the UAW and the Canadian government have a combined ownership stake in GM of about 50%. If any of these three were to dump their shares on the market, the remaining holders will see a drop in the value of their shares due to the dilutive effect of the new shares hitting the market. Recent stories regarding the mindset of the Canadian government reveal that they will mirror the market-timing philosophy of the US government by hanging on to their stake. The decision may be driven by closed door meetings with US Treasury Secretary, Tim Geithner.
According to thetruthaboutcars.com, “(Canadian) Finance Minister Flaherty said he has had ‘continuing discussions’ on the subject of the GM stake with U.S. Treasury Secretary … Read More ➡
The auction for the assets and business of green stimulus recipient A123 Systems has been won by Chinese auto parts manufacturer Wanxiang Group, which aggressively sought the electric vehicle battery maker at least since the summer.
The successful bid – reported to be about $260 million – follows weeks of warnings by the U.S. government, congressmen and a group of former military and other leaders that transfer of the Massachusetts-based company would compromise American jobs, technology and security. The auction attempts to address some of those concerns, as Wanxiang was not awarded any of A123’s contracts with the U.S. Department of Defense. Instead the company’s “government business,” including all its military contracts, was awarded to Illinois-based Navitas Systems.
“We think we have structured this transaction to address potential national security concerns expressed during the review of our previous investment agreement with Wanxiang announced in August as well as to … Read More ➡
General Motors is making more ridiculous claims on the Chevy Volt by flooding the web with stories of how 100 million electric miles have been driven since the Volt’s much-hyped inception. Let’s put the boasting in perspective. In the two plus years that it took for Volt drivers to put on 100 million miles, gas-powered vehicles logged over 5 TRILLION miles in the US. It would take only 5,000 cars traveling 10,000 miles a year to log 100 million miles in two years. The Volt has fallen far short of sales goals and has cost taxpayers billions of dollars in subsidies to reach the much-publicized but unimpressive milestone. So, what’s the net reduction in gas usage in the US as a result of the Volt’s accomplishment? Less than .002%.
Only the most extreme green energy ideologue and Volt proponent could brag about saving less than .002% of gas at the … Read More ➡