by Jon LeSage, editor and publisher, Green Auto Market
Here’s my take on the 10 most significant and interesting occurrences during the past week…….
- Hybrid and EV sales: Both hybrid and electric vehicle (EV) sales are off the path of typical seasonal patterns – down from May but also down from the previous year. Hybrid sales were down 17.6% from June 2014 and EV sales were down 9.6% from that time period. That’s taking place while the overall new vehicle sales market is down from May (a normal seasonal pattern) but up nearly 4% from the previous year. Gasoline prices have come up, but not enough to spur more interest in these vehicles, along with small and fuel-efficient cars. Some models are seeing high growth rates despite the market conditions. The Tesla Model S more than doubled in sales from June 2014, while the BMW i3 saw more than 50% in sales volume increase during that time. The Hyundai Sonata hybrid is seeing very strong sales numbers. Other models have seen large drops since last year, including the Chevrolet Volt, Ford Fusion Energi, and Toyota Prius Plug-in. With new versions coming out in the 2016 model year, the Volt and Prius Plug-in are expected to stay down through this year. As for the overall average fuel economy of new vehicles sold in the U.S. in June, it came to 25.4 mpg – down 0.1 mpg from May. This decline likely reflects the increased sales of light trucks and SUVs in June, according to the University of Michigan’s Transportation Research Institute.
- BP oil spill: More than five years after its massive Deepwater Horizon oil spill in the Gulf of Mexico, BP Plc has finally settled its agreement on federal and state claims – for a record $18.7 billion. Three anonymous people close to the matter said that BP’s campaign to fight these claims in court following the collapse of negotiations in 2013 finally ended with the settlement. Sources said that both falling oil prices and a federal judge’s recent rulings putting a potential $13.7 billion penalty on Clean Water Act violations helped motivate BP to change its tactics. BP has time to pay it off – once the agreement becomes finalized, payments could be spaced out over an 18-year span.
- CARB approves funding: The California Air Resources Board approved a $373 million funding plan for advanced technologies in fiscal year 2015-16, from zero-emission heavy-duty trucks and buses to rebates for low- and zero-emission passenger vehicles. That total is up by $150 million over last year’s budget. $350 million of the total comes from the funds in the state’s Greenhouse Gas Reduction Fund dedicated to low-carbon transportation investments. An additional $23 million comes from the Air Quality Improvement Program under AB 8. $200 million will be dedicated to light-duty vehicles, including the Clean Vehicle Rebate Project, which offers incentives for the purchase of zero-emission vehicles. $167.5 million will be dedicated to heavy-duty vehicle and freight-equipment projects, including vouchers to help support the purchase of hybrid and zero-emission trucks and buses. The remaining $5.5 million is held for administrative overhead and a reserve.
- Connecticut EV rebates: The state of Connecticut has paid out or committed to pay more than $131,250 in state rebates to consumers who’ve purchased or leased electric vehicles (EVs) since May 19. The $1 million program was created by Gov. Dannel Malloy’s administration. Rebates are offered at three levels, from $750 to $3,000 depending on the type of vehicle. Under the Connecticut Hydrogen and Electric Vehicle Purchase rebate, consumers can receive cash rebates of up to $3,000 for purchasing or leasing eligible battery electric, fuel cell, and plug-in hybrid vehicles; there are 67 eligible vehicles included in the program.
- Tesla Q2 earnings: Tesla Motors’ second quarter earnings increased 52%, which gives the company momentum prior to the launch of its Model X crossover model in September. Tesla sold 11,507 Model S electric sedans for the quarter that ended June 30, which set a company sales record. Dan Galves, an equity analyst with Credit Suisse, had correctly forecasted the higher-than-expected sales. He raised his price target on Tesla stock from $290 to $325.
- CALSTART has welcomed two new board members: Donna DeMartino, General Manager/CEO at San Joaquin Regional Transit District (RTD), and Dr. Jeffrey Reed, Director Business Strategy and Technology Advancement for Southern California Gas Company. DeMartino helped champion the first deployment of zero emission transit buses in the San Joaquin Valley. DeMartino was appointed RTD’s General Manager/CEO in 2001 and currently serves as the Chair of the California Transit Association’s Executive Committee. Reed leads development of business strategies and initiatives aimed at supporting the development and deployment of sustainable energy solutions and leads the natural gas RD&D, energy efficiency technology, and venture investment programs. He has also led numerous company initiatives related to renewable and low-carbon energy technologies and policy.
- United Airlines investing in sustainable fuels: United Airlines has made a $30 million equity investment in US-based alternative fuels developer Fulcrum BioEnergy, which turns municipal solid waste into low-cost sustainable aviation biofuel. United also has a long-term supply agreement with Fulcrum with the opportunity to purchase at least 90 million gallons of the fuel for a minimum of 10 years at a cost competitive with conventional jet fuel. In addition to the equity investment, United and Fulcrum have entered into an agreement that contemplates the joint development of up to five projects with the potential to produce up to 180 million gallons of fuel per year.
- BMW going for it with plug-in hybrids: BMW is expected to roll out four more plug-in hybrids that follow its recently launched BMW i8. Plug-in hybrid versions of the BMW X5, 2 Series Active Tourer, 3 Series, and 7 Series are on the list. This falls in line with meeting stringent emissions targets in Europe and the US, and committing to the company sustainability targets. Performance will also continue: BMW’s plug-in hybrid drive line offers xDrive all-wheel drive, which is automatically activated when the system recognizes certain road conditions. The combined output is 220-horsepower with 284 pound-feet of torque, allowing the car to accelerate from 0-62 mph in about 6.5 seconds.
- Toyota Mirai gets EPA ratings: The U.S. Environmental Protection Agency (EPA) has rated the 2016 Toyota Mirai hydrogen fuel cell vehicle at 67 mpg gas gallon equivalent (GGE) and 312 miles range. “Mirai is the only zero emission electric vehicle on the market that tops the 300 mile range milestone,” according to Toyota. The 2014 Honda FCX Clarity is rated 59 mpg GGE combined, 58 city, 60 highway. The 2016 Hyundai Tucson is rated 50 mpg GGE combined, 49 city, 51 highway.
- Uber wants driverless Teslas: Uber not only wants to bring ridesharing to cities around the world to reduce traffic and smog – now the company also wants to bring in driverless Teslas. Steve Jurvetson, an early Tesla investor and board member, heard Uber CEO Travis Kalanick make comments on it at the recent Top 10 Tech Trends dinner hosted by the Churchill Club in San Jose, Calif. If Tesla can build a fully-autonomous car by 2020, Kalanick says his company would buy every one Tesla builds. That probably won’t go over too well with Uber drivers who transport customers around in their own cars, and which Uber is very dependent upon to generate revenue.