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Speculating on what the Trump administration will mean for cleantech and transportation

white-house As the stunning election results settle in, speculation on the implications is pervasive through news and social media channels.

I do have two questions. What will President-elect Donald Trump’s administration be doing, and opposing, in the realm of cleantech and transportation? What can clean transportation stakeholders do to respond?

To start off, what happened with the election that set up such stunning results? Media analysts and pundits were using early polling findings and experience from past elections to assume they knew the outcome, until election evening. Pollsters assumed they knew how voters were going to vote, and they did seem to be accurate about how regular voters were going cast their ballots. It turns out that quite a few disenfranchised voters who hadn’t punched a ballot in years showed up and cast their vote for Trump. A lot of Millennial generation voters who had loved Bernie Sanders but settled for Hillary Clinton didn’t bother to show up and vote or to mail an absentee ballot. Clinton may have won the popular vote but lost in key electoral vote states, the fourth time that’s happened in U.S. history; but ballots are still being counted to determine the popular vote total.

We may have received a signal of where the new administration will be standing on some of the relevant issues. Right after Election Day, a statement was released on a review of the fuel economy and emissions standards by the new administration.

“The Trump Administration will complete a comprehensive review of all federal regulations. This includes a review of the fuel economy and emissions standards to make sure they are not harming consumers or American workers,” said John Mashburn, a senior policy adviser for Trump, as reported by Automotive News. “It is important to remember that this particular program was first put in place as a way to reduce our nation’s dependence on foreign oil, not for purposes of global warming regulation. Mr. Trump will be focused on bringing jobs, including auto manufacturing, back to the U.S., and making sure that government policies are in the national interest.”

On Thursday, the Alliance of Automobile Manufacturers sent a letter to President-elect Trump’s White House transition team asking to ease regulatory pressure from the Obama administration’s fuel economy and emissions rules calling for 54.5 mpg by 2025. The rules, which become increasingly stringent in the 2017 model year, are considered to be a “substantial challenge” for the industry, according to the letter. While alliance members (including General Motors, Ford, BMW, Mercedes, VW, Mazda, Volvo, Fiat, and Toyota) have supported the program, the industry is concerned about the timing and costs of the rules, which will require billions of dollars in investment.

Here are a few legislative, regulatory, and economic issues to follow:

Grant funding: U.S. Department of Energy and U.S. Environmental Protection Agency funding is likely to be scaled back as the Obama administration leaves office. That means low-interest loans and grants for advanced vehicle technology projects by automakers, suppliers, universities, and research center partners will probably lose funding. Other parties likely to lose funding include electric vehicle charging infrastructure suppliers; alternative fuel vehicles being deployed in the federal fleet; grants for research and development of alternative fuels like biofuels and renewable natural gas and diesel; and clean transportation projects aimed at cargo transport. Fleets, OEMs, and suppliers will need to tap into other resources like state, regional, and city funding programs; and university R&D projects.
EV incentives: The Trump administration is likely to lose interest in renewing and expanding federal tax incentives for purchasing electric vehicles, which go up to $7,500. General Motors and Nissan are close to reaching the cap on allowable EVs qualifying for the tax incentives, and other automakers will follow. These incentives will go away unless renewed. Trump has expressed opposition to the government picking “winners and losers” and tends to not show support for government action continuing these types of programs. Like grants, automakers will need to turn to other sources like states for funding and utilizing their own purchase incentive programs to attract green car buyers.
Watch for gridlock in Washington: Trump and his campaign statements have been opposed to the Obama administration on clean energy policies. Trump has called climate change a hoax during the campaign, and promised to renegotiate the United Nation’s Paris climate accords. He’s opposed to the Obama administration’s Clean Power Plan, which is directing utilities to reduce carbon emissions. Some of Trump’s dramatic proposals may also see resistance from Republican committee chairs in Congress. To carry out his wish of abolishing the EPA would need broad support in the House and Senate. When it comes to the huge investment Trump promised to spend on roads and other infrastructure, he will likely face stiff opposition from fiscally conservative Republicans. Environmental groups have expressed deep concerns over where Trump’s policies will be heading. “We’re feeling angry and sad and contemplative,” said Michael Brune, executive director of the Sierra Club. “Trump is now, as president-elect, soon to be the only head of state on the planet that doesn’t believe in climate change, nor thinks we should do anything about it. That should strike fear in the hearts of every parent in this country.”
Globalization: Trump took on Ford Motor Co. and its plans to move all its small-car assembly plants to Mexico as a pivotal issue during stump speeches from the very beginning of his campaign. Ford is not the only automaker in Mexico, with Trump also taking aim at General Motors for its plans to invest $5 billion more in Mexico. Other companies have been there for years like BMW, Chrysler, Fiat, Honda, and Volkswagen. It certainly goes way beyond Mexico with automakers also investing heavily in operations overseas in places like China, India, and Brazil. Trump has been able to stir up anger and frustration for workers at vehicle manufacturing and parts and components plants who’ve lost their jobs in the Great Lakes region, or who’ve feared it will happen to them next. Union members who usually vote Democrat leaned toward Trump. Fear of losing jobs to overseas markets has touched a nerve. The United Auto Workers, which had campaigned against Donald Trump this fall, is prepared to support his bid to overturn the North American Free Trade Agreement. Trump has also said he plans to reject or renegotiate other trade deals. Automaker executives will have to sort this out in dealing with the Trump administration and its decisions on tariffs, trade agreements, and statements affecting the public’s attitudes about the auto industry.
China: The alliance between the U.S. and China has been a central part of the Obama administration’s foreign policy and clean energy initiatives. The Chinese national government and regional entities have given generous subsidies to foreign companies and investors to set up manufacturing and assembly plants in China. That strategy has contributed significantly to China’s economy, with companies like Apple and General Motors taking it very seriously. That international alliance has been tracked closely in the past year by Green Auto Market and other publications as sales of battery electric and plug-in hybrid vehicles have taken off in China, making Chinese company BYD the third largest seller of EVs in the world. Chinese backers such as Wanxiang Group have played a vital role in seeing companies like Karma Automotive and A123 Systems establish a foothold in the U.S. and, eventually, in China. As reported in media, developing and maintaining a strong and mutually beneficial relationship with China has been, to say the least, challenging for the Obama administration; relations between the two nations are much more tense now than they were in 2009. The Trump administration may not do well with that tension and could break ties that have been set in the past eight years – if U.S. interests in China and the Asia-Pacific region aren’t perceived as making forward gains. The climate change agreement with China is also likely to languish under the new presidency. If you review the Trump website’s policy section, you’ll find a few statements on free trade that indicate where things may be going with China: “Instruct the Treasury Secretary to label China a currency manipulator…… Instruct the U.S. Trade Representative to bring trade cases against China, both in this country and at the WTO (World Trade Organization). China’s unfair subsidy behavior is prohibited by the terms of its entrance to the WTO…….. Use every lawful presidential power to remedy trade disputes if China does not stop its illegal activities, including its theft of American trade secrets.”
Tesla CEO Elon Musk’s viewpoint: “I think a bit strongly that (Trump) is probably not the right guy” for the presidency, and wouldn’t be the best candidate to represent the U.S. abroad, he told CNBC on the Friday before the election. Democratic presidential nominee Hillary Clinton’s economic and environmental policies “are the right ones,” Musk said. Other automakers have expressed concerns over policies likely to be adopted by the Trump administration, but have kept a neutral stance on the outcome of the election.
CARB: California’s Air Resources Board has rescheduled a key hearing from Dec. 8-9 until sometime in February; that will be after Trump has taken office and there’s more clarity on where the nation’s clean-air rules overseeing vehicles are headed. The delay in the hearing is needed to give more time to gather reaction to recommendations the board staff is now preparing, a board spokesman said. The Alliance of Automobile Manufacturers also wants to see states follow CARB’s lead on the zero emission vehicle policy to avoid a patchwork of problems. Automakers would like to see the nine other states that have adopted the ZEV policy to follow California’s practice of supporting the mandate with tax incentives and other programs. That’s led to “dramatically” different ZEV credit purchase rates outside of California, the trade group said.
Biofuels vs. oil: The EPA said on Thursday it plans to deny several petitions from oil groups to change the country’s biofuels program, an issue that has deeply divided the petroleum industry. The oil industry has spent millions lobbying against the Renewable Fuel Standard (RFS), which mandates biofuels being blended into gasoline and supports development of advanced alternative fuels such as biodiesel and cellulosic ethanol. A final decision will probably not be made until Trump is in the White House. The Trump administration is more likely to consider the refiners’ requests, said Timothy Cheung, vice president at ClearView Energy Partners in Washington. A policy statement from Trump’s campaign website may shed some light on the new administration’s support for oil and gas: “Unleash America’s $50 trillion in untapped shale, oil, and natural gas reserves, plus hundreds of years in clean coal reserves.”

As for possible responses to the Trump administration potentially blocking support for electrified transportation, alternative fuels, and infrastructure – along with market dynamics moving forward no matter who had won the presidential election – here are a few to watch for:
Adoption of electrified vehicles: A report by Michigan-based analyst Alan Baum forecasts that by 2018, the number of hybrid, plug-in hybrid and all-electric models sold in the U.S. will jump to 92 from 58 this year. Baum expects hybrid and EV sales to rise well above their current margin of about 3% of U.S. new vehicle sales in the next 10 years. Daimler and BMW both have predicted plug-in electrified vehicle sales will account for as much as 25 percent of their total deliveries in about 10 years. Volkswagen said in June that the company will launch more than 30 all-electric vehicles over the next 10 years with a goal of selling two to three million of these EVs in 2025. Tesla will be producing about 500,000 electric vehicles beginning in 2018 as the Model 3 comes to market in late 2017. General Motors plans to compete directly with the Model 3 with its Chevrolet Bolt electric car, which just started rolling off assembly lines.
Fleets will continue to play an important role: Fleets are among the early adopters for new vehicle technologies and will continue to play that important role. If Trump makes the climate change argument harder to buy into, fleets are usually skilled at making the case for adoption of clean vehicles other ways, including emphasizing energy independence and return on investment. The clean vehicle may be higher in acquisition cost but will reach payback in a reasonable amount of time compared to the cost of gasoline and diesel; and the cost of maintaining internal combustion engine vehicles when compared to plug-in electrified vehicles. Clean Cities coalitions have been very helpful in assisting fleets, and their OEM and supplier partners, to make the business case for adopting clean vehicles.
Trade disputes: Arguments between the U.S. and China over fair trade practices will likely mean less in the coming years. GM, Ford, Volkswagen, Hyundai, BMW, Daimler, Nissan, Honda, Toyota, Mazda, and other automakers already have joint-venture alliances with Chinese automakers. EVs are being added to their product lineups for sale in China. Chinese automaker BYD has a large stake owned by Warren Buffet and Berkshire Hathaway. Tesla is investing heavily in setting up stores and service centers in China, and is eying Shanghai for setting up a factory. A similar trend is carrying over to the U.S. market, where Wanxiang America has set up its headquarters in Chicago, BYD is manufacturing and selling electric buses, and other Chinese investors have stakes in U.S.-based electric vehicle makers and suppliers. Whether Trump or auto workers like it or not, globalization is a dominant economic force, right up there with new technologies being developed. Automakers are looking at opportunities all over the world, including Renault-Nissan planning on bringing more hybrid vehicles to Europe to replace diesel cars; and Mitsubishi bringing its Outlander PHEV over the U.S. market after seeing it become a top-selling plug-in electrified model in several European countries.
Creative financing: Federal grants and low-interest loans are likely to fade away, but there are other sources to consider. California is well known for grant programs, including through the AQMD entities; Chicago and New York have been funding clean transportation programs, and other cities and states are renewing their incentive programs. Startup OEMs, suppliers, and charging and alternative fueling infrastructure companies have turned to other capital sources and will continue to do so. Watch for more activity coming from crowdfunding, angel investors, and private equity firms. Ride-hailing giant Uber has set the tone for private investors to come through, and that’s crossing over to competitors and startups in food and packaged goods delivery.
Keep on keeping on: During Hillary Clinton’s concession speech Wednesday, she encouraged young professionals to stay committed to their goals no matter how an election may turn out. Sierra Club, Natural Resources Defense Council, and Ceres issued their own statements reaffirming their commitments to environmental objectives. NRDC published its own statement on the matter the day after the election: “Know this: NRDC will fight for our environment, for our climate, and for our shared clean energy future — harder than we ever have fought before.”

This Week’s Top 10: Hybrid and EV sales down from September, Bolt production starts up

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: Hybrid and plug-in sales followed the overall market, which has been down over the past three months. Hybrid sales in October were down 15.3% from September and 13.1% from October 2015. Plug-in hybrid and battery electric car sales were down 29.36% from September, but were up 13.47% over October 2015. The Chevy Volt and Ford Fusion Energi led plug-in hybrid sales. Tesla saw a sizable drop in sales that may been affected by Tesla slowing down production to enable new autonomous technology hardware. Sales in November and December are expected to go back up as Tesla works hard at hitting quarterly sales goals.
Building the Bolt: General Motors has started production of the all-electric Chevrolet Bolt at its assembly plant in Orion Township, near Detroit. The first of the electric cars capable of going 238 miles on a charge will show up for sales before the end of the year, the automaker said. Badged as the Opel Ampera-e in Europe, the new model is due to be launched in European markets next year.
Toyota long-range EVs: Toyota Motor Corp. may be joining the race for long-range electric cars, according to the Nikkei. The automaker is exploring mass-producing battery electric cars that would hit the market by 2020, the Japanese news report said. In late October, Toyota said it has worked with Panasonic Corp., which also produces lithium ion batteries with Tesla, to improve the precision in battery cell assembly and extend range. This new battery technology will roll out soon in the soon-to-be-launched Prius Prime plug-in hybrid electric vehicle. That plug-in hybrid will go 37.3 miles on battery alone before the gasoline engine takes over; the new battery technology may go into all-electric, extended range cars, too.
Uber and Maven: Uber announced it will be partnering with General Motors’ new carsharing service, Maven. Uber drivers will be able to rent GM vehicles on a weekly basis. GM and Uber will be in a 90-day pilot where drivers will be able to rent GM vehicles for $179 plus taxes and fees per week. That was a bit surprising given that Uber’s main competitor, Lyft, now has a partnership with GM. A similar program, called Express Drive, had been started up for Lyft drivers and operates in about 10 U.S. cities. Alliances between automakers and mobility services continue to expand this year, including Toyota and Uber; Toyota and Getaround; and Volkswagen and Gett.
LA Auto Show: The Los Angeles Auto Show is launching a pre-car show segment for media and industry professionals called AutoMobility LA. Taking place Nov. 14-17, and to the general public Nov. 18-28 at the LA Convention Center, the latest technology devices will be displayed that embrace all forms of transportation and complement new and traditional vehicles. Located in the South Hall Atrium, “GO” features the latest smart mobility devices that can include electric scooters, bikes, or mobility apps. Also keep in mind that the annual Green Car of the Year award winner will be named on Thursday, Nov. 17 at the Technology Pavilion at LA Auto Show.
Free Tesla charging ending for new owners: Tesla owners had been able to fast charge for free for the past four years, using Tesla’s Supercharger Network. Drivers had access to free charging at a worldwide network of 4,600 chargers. That will come to an end soon as the company adopts a “change to the economics of Supercharging.” Cars ordered vehicles before January 1 and delivered before April 1, 2017, still will have free access to Superchargers. Customers who order after Jan. 1 will receive 400 kilowatt-hours – about 1,000 miles – of free charging credits annually, then will pay a fee “less than the price of filling up a comparable gas car,” the company said. Upcoming Model 3 owners won’t have access to free charging, CEO Elon Musk said during a shareholders meeting in May.
VW scandal continues: Volkswagen AG’s chairman Hans Dieter Pötsch has been added to the list of executives under investigation over fraudulent emissions reporting. The chair and former chief financial officer is suspected by German prosecutors of violating securities laws, especially failing to notify shareholders quickly enough about the financial risks of the scandal. German prosecutors have been at work on plea agreements with other executives; and former CEO Martin Winterkorn and board member Herbert Diess have been under investigation for failing to disclose information.
Gas and diesel engines waning: Internal combustion engines (ICEs) may be heading toward the end of their shelf lives, according to a Lux Research study. Governments may one day make them illegal and ICEs may be priced out of the market, according to the study. Netherlands has considered banning ICEs by 2025, with a similar debate starting in Norway. India would like to see 100% of new car sales go to something other than ICEs by 2030. Germany’s legislature is also considering a total ban by 2030. The study says that ICEs may actually decline earlier than government mandates push for. EVs are getting cheaper by the year, thanks to improving batteries and mass production. ICEs are getting more expensive, due to tougher fuel efficiency regulations that require more complex and pricier engineering like 10-speed rather than five-speed transmissions, double- and triple-turbocharging, and other new and costly technologies.
Wrightspeed extended range trash trucks: Wrightspeed rolled out what is says was the first commercial application of a range-extended electric refuse truck last week. Through its partner company, The Ratto Group, in Sonoma County, Calif., Wrigtspeed’s turbine-electric powertrain will be placed in at least 15 vehicles deployed into the trash hauling company’s fleet over the next year. With fuel economy up to about 7 mpg in combined electricity-liquid fuel operation, the powertrain can slash annual fuel consumption by 70 percent or more compared with the average diesel garbage truck, Wrightspeed said.
Lutz on autonomous vehicles: Bob Lutz, former vice chair at General Motors and champion of the Chevy Volt, thinks that fully autonomous vehicles are 15 to 25 years away. Lutz expressed his views during the annual awards dinner of the Michigan Venture Capital Association. His vision for the future is different than Google’s and several automakers. Cars will be replaced by “modules” that will look like telephone booths laid down, and electronically linked in a seamless train on the freeway moving at 200 to 250 mph. They’ll be powered by inductive electrical rails in the freeway, Lutz said.

Alternative Fuel Corridors and DOE data show where clean transportation infrastructure stands

ev-corridor-in-fhwa-map As you probably know by now, the Federal Highway Administration released a map last week showing 55 routes across the U.S. for charging plug-in vehicles and refueling alternative fuel vehicles, with 48 designated charging routes in the new corridor. The Alternative Fuel Corridors covers 35 states and nearly 85,000 miles, according the U.S. Department of Transportation’s FHWA. More miles will be added to the network to accommodate electric, hydrogen, propane autogas, and natural gas vehicles as more alternative fueling and charging stations are built.

The designation of these corridors comes from the “Fixing America’s Surface Transportation” (FAST) Act, which was signed by the president in December 2015. In July, U.S. Transportation Secretary Anthony Foxx put the alternative fuel station provision in motion by calling on states to nominate national plug-in electrified vehicle charging and hydrogen, propane, and natural gas fueling corridors along major highways.

You can view an Alternative Fuel Corridors resources page that includes a map showing each of the charging and fueling networks. There’s only one electric charging route linking the nation, which crosses the Great Plains with Highway 70 bridging between Utah and Colorado. Charging station routes are concentrated in the Northeast, East Coast, Great Lakes region, Texas, and the West Coast. Compressed natural gas will have corridors very similar to charging networks. Hydrogen fueling routes will be concentrated in California, Colorado, the Midwest, and the Northeast.

During a telephone interview with CNBC on Friday, Tesla CEO Elon Musk didn’t support the corridor project. Tesla’s Supercharger fast-charging network has been in place with its own cross-country corridor for quite a while now, he said, and he didn’t see the point in talking about the federal program. Musk’s comments reflected Tesla’s competitive philosophy of having the best electric cars and charging in the industry, and the company doesn’t see the point of cooperating on, or supporting, industry and government standards. That response also speaks to challenges the fast charger network faces with the CHAdeMO, SAE combo charger, and Tesla standards differing.

Looking at the Alternative Fuel Corridors maps, and the Energy Department’s data on alternative fuel stations, you can get a good look at where the clean transportation infrastructure stands in the U.S.

Infrastructure: US Fueling and Charging Stations
Biodiesel (B20 and above): 170, down from 236 a year ago
Compressed Natural Gas (CNG): 958, up from 867 a year ago
Electric Vehicle Charging Stations: 14,683, up from 10,998 a year ago
Ethanol (E85): 2,757, up from 2,678 a year ago
Hydrogen: 31, up from 12 a year ago
Liquefied Natural Gas (LNG): 83, up from 73 a year ago
Liquefied Petroleum Gas (Propane): 427, down from 1,524 a year ago
Source: Alternative Fuels Data Center

Propane has seen a dramatic drop in fueling stations during the past year – from 1,524 a year ago to 427 in the U.S. now, according to the Alternative Fuels Data Center. That’s likely been coming from propane networks consolidating stations to better serve the market. Some of the propane autogas stations are on private grounds not available to the public, such as school bus fleets. ICF International, Inc., based in Fairfax, Va., projects consumer propane sales to grow by about 9% between 2014 and 2025. Most of the growth will come from the propane engine fuel market, although lower propane prices associated with the growth in domestic propane supply and lower oil prices will also make propane more competitive in traditional propane markets, including residential and commercial space heating, and forklift markets, according to an ICF report prepared for the Department of Energy.

Biodiesel has also seen a drop in the past year, at 236 last year and down to 170 stations recently. That may have to do with the EPA dragging out its ruling on the federal Renewable Fuel Standards and decreasing volume mandates on the advanced biofuel. Biodiesel is also seeing more competition come from renewable diesel, which is being adopted by several large fleets in California to tap into low carbon fuel standard credits.

Electric charging stations, compressed natural gas, and hydrogen stations have seen impressive growth ratios in the past year. Charging stations grew by nearly a third in the past year, up to 14,683 stations. According to the U.S. Census Bureau, there were 114,533 gas stations in the U.S. at the end of 2012, the last year for which data is available, so there will need to be another 100,000 charging stations to match the reach of retail gas stations.

The corridor routes will be seeing signs posted similar to what’s been typical on highways for years alerting drivers to upcoming gas stations, food, and lodging. It will play an important role in the federal government’s mission to reduce carbon. Supporting lower-emission vehicles will help the U.S. meet its 2015 pledge to reduce greenhouse gas emissions by 80 percent or more by 2050, according to the FHWA.

“Alternative fuels and electric vehicles will play an integral part in the future of America’s transportation system,” said Secretary Anthony Foxx in the press release. “We have a duty to help drivers identify routes that will help them refuel and recharge those vehicles and designating these corridors on our highways is a first step.”

This Week’s Top 10: The latest on zero emission credits in California, Fisker says his car will have 400 mile range

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…….

ZEV credits: The California Air Resources Board may plan this week for the state’s emissions targets to remain largely unchanged through 2025 and then jump after that year, according to three people familiar with the proceedings. This will disappoint Tesla CEO Elon Musk and environmental groups that have called for expansion of the zero emission vehicle incentives. Tesla sold 80,227 credits during the 11 months through August, which accounted for 86% of the total. And even at prices below what Musk wants, the sales helped Tesla report a profit in the third quarter after having sold $139 million worth of ZEV credits during that quarter. CARB is reassessing its targets as part of the so-called mid-term review of President Barack Obama’s fuel-economy and emissions goals for 2025.
Longest range ever: Henrik Fisker is striving to earn the bragging rights on plug-in electric vehicle performance. The head of the Fisker Inc. startup on Monday claimed that the all-electric luxury sedan to be released next year, called EMotion, will be able to travel 400 miles on a single charge, reach a top speed of 161 mph, and it will come equipped with hardware allowing for fully autonomous driving. The company said it will announce its self-driving car technology supplier “soon” without providing further details.
Renewable diesel: San Diego is becoming the largest fleet in the nation to use renewable diesel, with 1,125 diesel vehicles using the clean fuel, including street sweepers, refuse packers, and firetrucks. Doing so will release 80-percent fewer emissions than traditional diesel, according to state officials. That helps the city meet its goal of cutting greenhouse-gas emissions in half by 2035 under its Climate Action Plan, which was adopted in December. The city’s fleet was at first reviewing the option of converting vehicles over from diesel to compressed natural gas, but discovered renewable diesel to be cheaper and much cleaner in reducing emissions. The city doesn’t have to invest in conversion to start using the renewable diesel.
Bolt production: In May, General Motors had stated the all-electric Chevy Bolt would start production in October, but then pulled the document off its website and wouldn’t comment on it anymore. There’s only been a rumor shared on Twitter so far; that source said that the production line at the Orion assembly plant has officially started. It was posted by the WaterlooRegionVoltec group of Waterloo Region, Ontario, Canada.
Tesla supporters cult members: Lutz on Ex-vice chairman of General Motors and champion of the Chevy Bolt, Bob Lutz, shared another zinger on Tesla Motors and its CEO, Elon Musk. “Tesla supporters are like members of a religious cult,” Lutz said during an interview with CNBC last week. “Just like Steve Jobs was worshiped at Apple, it’s the same way with Elon Musk … seen as a new visionary god who promises this phantasmagorical future, a utopia of profitability and volume.” Watch the video to hear more.
Health and climate study: The health impact of air pollution has become a widely cited source for implementing emissions reductions rules for transportation. Another study has been released tracking the damage. A new report from the American Lung Association of California states that vehicles are responsible for $37 billion in health and climate costs each year. The study tracked California, Connecticut, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, Rhode Island, and Vermont—the 10 states that have zero emission vehicle sales programs.
Wind and solar: International Energy Agency reported that renewable energy that last year marked a turning point for renewables. Led by wind and solar, renewables represented more than half the new power capacity around the world, reaching a record 153 Gigawatt (GW), 15% more than the previous year, and surpassing coal power. Renewables are also expected to be the fastest-growing source of electricity generation over the next five years, increasing market share from 23% in 2015 to 28% in 2021.
Wheego goes autonomous: Previously known as Wheego Electric Cars, the revamped company now known as Wheego Technologies no longer manufactures electric cars. It considers itself to be an R&D company, supplying its electric drive and autonomous driving systems. After starting in 2009, the company sold about 400 units through its network of dealers, but it’s been nearly three years since any have been built. The company now is focused on developing products for autonomous vehicles that use machine learning and artificial intelligence. It has two divisions with about a dozen employees each, and was recently granted a permit to test autonomous vehicles in California.
Chicago electric buses: Electric bus maker Proterra just won a large contract in Chicago. JLL, a leading professional services firm specializing in real estate, announced the first commercial agreement to provide commuter shuttle services via a fleet of electric buses. The service will operate between Chicago’s commuter train stations and two of the city’s tallest buildings, the Prudential Plaza and Aon Center, both of which are managed by JLL. Proterra has leased 10 Catalyst electric shuttle buses to JLL.
Flying car ride-hailing: Uber has conducted a report on what it calls Uber Elevate, which may become the name of its division providing riders with flying car trips. Along with Otto, the self-driving trucking unit, and the Pittsburgh autonomous car rides, Uber says it wants to find a manufacturer of flying cars to partner with and build an on-demand urban aviation system. Uber is talking to flying car startup makers Aero, Joby Aviation, eHang, and Terrafugia, and others about working together; though it will be several years from now until you’ll get to book a trip on your smartphone.

China may return to supporting hybrids as another channel for hitting targets in cutting emissions and oil imports

toyota-levin-in-china China is facing a challenge similar to the U.S. – how to get car shoppers to buy more clean vehicles and less gas guzzling pollution emitters like large SUVs. While plug-ins, or “new energy vehicles,” have taken off in sales during the past couple of years, China’s regulatory and incentive structure appears to be changing toward a broader definition of clean vehicles. Toyota and a few Chinese automakers and suppliers are asking the government to support plug-less hybrids as another way to reduce tailpipe emissions and dependence on imported oil

In 2013, incentives in China for purchasing plug-in electrified vehicles (PEVs), along with electric buses, jumped up while hybrid electric vehicle subsidies were cut. The definition of new energy vehicle changed exclusively to PEVs as previous new energy incentives for plug-less hybrids were cut.

That may change course as the government is considering mandating policy requiring 25% of new vehicle sales to be plug-less hybrids by 2030, according to comments made last week by Ouyang Minggao, who leads a group that China’s auto industry regulator commissioned to set targets for energy-saving vehicles. The report recommends increasing hybrid sales to 8% of total passenger vehicle sales by 2020, and then up to 20% by 2025 and one quarter of sales by 2030.

China is also considering extending a tax cut beyond the end of this year for small-engine cars with up to 1.6 liter engines, an industry ministry official said last week. That move could help sustain a sales rebound in small, fuel-efficient vehicles in the world’s largest auto market.

China requires automakers to lower the average fuel consumption of their vehicles to 5 liters per 100 kilometers by 2020 from the current 6.9 liters. New energy vehicles will play a part, but now China may be looking to hybrids and small cars to help hit the fuel consumption and emissions targets. This year has seen a steep increase in large SUV sales in China as gasoline prices stay down and consumers with more spending power find SUVs appealing, similar to what’s been seen in the U.S. market. That puts more pressure on China to meet emissions and fuel economy goals.

Subsidies to manufacture and purchase PEVs have made a huge difference in the market. Through September, China came close to selling as many cumulative PEVs as the U.S. has seen since they first appeared in the market in late 2010; with the U.S. total at 522,519 cumulative PEVs sold and China finishing the month at 521,649 sold. At the end of 2012, China had only seen 27,800 PEVs sold, with dramatic sales surges seen in 2014 and 2015. If electrified buses were to be included in the total, China would be clearly the world’s leader with 733,447 new energy vehicles sold through the end of 2015, according to HybridCars. Generous government incentives are considered to be a big part of rapid growth in China’s PEV sales.

Earlier this year, the Chinese government announced plans to cut 2017-2018 new energy/plug-in vehicle subsidies by 20% from those granted in 2016, and 2019-2020 subsidies will be 40% less than this year. These subsidies will stop after 2020, the government said. Instead, China will support development of a points-based credit system similar to that used in California to encourage production and use of new-energy vehicles.

Cutting PEV subsidies may be exacerbated by a scandal reported in September on rule violations by several vehicle manufacturers. Five Chinese bus makers were penalized by the government for taking about 1 billion yuan ($150 million) in illegal subsidies for new energy vehicles. Soon after, an additional 20 automakers were called out for violating these rules. These included global automakers Nissan and Hyundai, and Chinese makers Geely, JAC Motor, and a subsidiary of electric carmaker BYD.

The China Association of Automobile Manufacturers changed its forecast for PEV orders to 400,000 from 700,000 vehicles, down 43 percent, last month. China’s top auto industry association slashed its forecast of new energy vehicles that will be ordered this year as the government subsidy scandal widened.

Manufacturers such as Zhejiang Geely Holding Group Co. and Hunan Corun have been lobbying the Chinese government to increase support for development of plug-less hybrids. Hunan Corun supplies batteries for Toyota’s China-built hybrids.

Toyota has made the argument in China that hybrid technology could be more widely accepted by consumers as a solution.

Toyota plans to bring a hybrid version of its RAV4 sport utility vehicle to market in China as soon as possible, Matsumoto Shinichi, executive vice president of Toyota’s local engineering and manufacturing unit, said prior to the Beijing auto show earlier this year. The Japanese automaker plans to localize the development and production of hybrid SUVs in China, after introducing its Corolla and Levin hybrid compact cars late last year for a 2018 introduction, including plug-in hybrid variations.

This Week’s Top 10: Honda Clarity longest range ZEV, Faraday Future unveiling first production electric car

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…….

Longest range ZEV: The Honda Clarity Fuel Cell sedan, launching later this year, received a U.S. Environmental Protection Agency driving range rating of 366 miles and fuel economy rating of 68 miles per gallon of gasoline-equivalent combined, according to American Honda. That makes it the longest range zero emission vehicle that will be sold in the U.S. “Not only does the Clarity Fuel Cell fit five passengers and refuel in three to five minutes, it offers customers a driving range on par with gasoline-powered cars,” said Steve Center, vice president of the Environmental Business Development Office at American Honda Motor Co. “The Clarity leads the pack with a 366 mile driving range rating, and with a growing network of hydrogen stations and fast fueling time, the zero-emissions family road trip is no longer science fiction.”
Faraday reveal at CES: Faraday Future will unveil its first production vehicle at CES 2017, at the same consumer electronics show where the Chinese startup was originally introduced. The company hasn’t revealed details on the first car and whether it will be the FFZERO1 electric concept car. It’s just shown a teaser image on its Twitter page so far. A spokesman told Fortune that the first product “will be a premium electric vehicle that combines extreme technology, industry leading range, and holistic design.”
Green truck nominees: Green Car Journal and the San Antonio Auto & Truck Show named 10 finalists for the 2017 Green Truck of the Year and Commercial Green Car of the Year awards, which will be presented in San Antonio on November 10. Finalists for 2017 Green Truck of the Year include the Chevrolet Colorado, Ford F-250 Super Duty, GMC Canyon, Honda Ridgeline, and RAM 1500. Vying for 2017 Commercial Green Car of the Year are the Ford F-250 Super Duty, Ford Transit Connect, Mercedes-Benz Metris, Nissan Titan XD, and RAM ProMaster City. This year’s finalists do the ‘heavy lifting’ in every day life, while achieving greater levels of environmental performance without sacrificing core capabilities expected from these highly-functional vehicles, said Green Car Journal editor and publisher Ron Cogan. Green Car Journal has yet to announce its 2017 Green Car of the Year award nominees. Earlier this month, journalists from 22 different countries named nominees for a separate award – the 2017 World Car of the Year. One of the categories was nominees for 2017 World Green Car of the Year: Chevrolet Bolt, Chevrolet Malibu, Tesla Model X, Audi Q7 e-tron 3.0 TDI, BMW 740 e iPerformance, Mercedes GLC 350 e, Honda FCV Clarity, Toyota RAV4, Toyota Prius Prime, Hyundai Ioniq, and Kia Niro.
LeEco mishap: LeEco, a backer of Faraday Future, planned to unveil a self-driving electric car in San Francisco last week. LeEco founder, Chinese billionaire Jia Yueting, was supposed to ride out on stage driven by the concept car, but instead had to run out on stage by himself. The misfire was caused by a delay getting the LeSee car prototype from London – where it is being used in the film “Transformers 5” – to San Francisco, the company. “It shouldn’t be me running out here, we didn’t have any other choice,” Jia told the audience, speaking through a translator. “What we wanted was me in the car, and the autonomous car drives me out.”
Honda green car sales forecast: Honda CEO Takahiro Hachigo said that by 2030, he wants more than two-thirds of U.S. Honda and Acura volume to come from green cars such as hybrids, plug-in hybrids, fuel cell vehicles, and all-electric vehicles, as reported in Automotive News. That would translate to more than one million electrified vehicles a year sold by American Honda Motor Co., based on its present volume. That would be a steep climb over the next 14 years. American Honda sold only 2,329 hybrid vehicles in the U.S. in the first half of the year, and sales of the Accord plug-in hybrid and Fit EV have been very small this year.
GM in China: General Motors says that it will be introducing 20 new or redesigned Chevrolet models by 2020 in China, including hybrids and plug-in hybrid electric vehicles. The automaker said five of the 20 vehicles have been introduced this year, including the Malibu XL, the Malibu XL Hybrid, the new Cruze, a Cavalier family sedan, and the sixth-generation Camaro. Most of the vehicles will be made in China by the company’s SAIC-GM joint venture. “Chevrolet will continue to strengthen the best model lineup in the brand’s history in China,” Alan Batey, GM North America president and head of Global Chevrolet, said in a statement. “In the coming years, we will roll out breakthrough products with technologies that improve safety, performance and fuel efficiency for our customers.”
Butterfly wings: Fisker, Inc. has released a teaser photo of its all-electric vehicle that will be launched next year. In the image, you can view raising wings on a sports car. Henrik Fisker has released a teaser image of his first new car. Fisker has tweeted the image with the caption: “A Breakthrough: Innovative new butterfly doors in our new Fisker model, for easier ingress/egress.” He also promises that more will be shared soon on the new vehicle.
Fuel-cell buses: Toyota has announced plans to begin selling hydrogen fuel-cell buses starting early next year. The company plants to be selling more than 100 of these buses in and near Tokyo in advance of the 2020 Olympic and Paralympic Games. The fuel-cell system is based on what’s used in the Mirai modified to work in a municipal bus.
Atieva launching Tesla competitor: Atieva, a Silicon Valley that began making batteries for Chinese buses before hitting financial troubles, is expected to unveil a Tesla competitor in early December, an electric sedan named Atvus. The company started in 2007 and developed batteries and electric drivetrains, plus battery packs for electric buses in China. Since then, investments by Chinese state-owned carmaker BAIC and LeEco seem to have given the company solid financial backing. Atvus will have the same electric drivetrain as the Mercedes-Benz Vito van named Edna shown in videos earlier this summer. Atvus looks a lot like a Tesla Model S, according to Recode.
Survey on electric cars: Forty-three percent of Californians say they are considering buying or leasing an electric vehicle before 2025, according to a Vrge Analytics survey of 837 conducted in August. When informed that there are EVs in development that are roughly the same price as traditional vehicles with a range of more than 200 miles per charge, sixty-five percent of respondents say they would consider buying or leasing one. “Californians are ready to trade-in their gas guzzlers for clean cars,” said Mike Montgomery, Executive Director of CALinnovates, an advocacy group focused on improving industries and expanding economic opportunities for Californians through innovative technologies. “This research suggests that the EV industry in the state is at a tipping point. Automakers should seize on this opportunity and go all-in – by putting a fleet of world-class, innovative, affordable EVs on the roads.”

Tesla separates new fully automated Level 5 system from semi-autonomous Autopilot Level 2 features

tesla-video-on-fully-automated-system Take a look at Tesla’s new video, released hours after the Wednesday evening media conference call announcing its full self-driving hardware. It starts with a statement separating the new system from semi-autonomous Autopilot features: “The person in the driver’s seat is only there for legal reasons. He is not doing anything. The car is driving itself.”

A passenger sits in the driver’s seat of a Tesla Model X and places his hands under the steering wheel just as the Rolling Stone’s 1966 song, “Paint It Black,” provides background music. That song refers to black and white screen images laced into the video that shows viewers the new full self-driving capabilities that Tesla CEO Elon Musk explained Wednesday evening during the conference call. “Right rearward vehicle camera” is the first feature displayed in black and white during the video. After taking a spin around on city streets and a freeway, the all-electric SUV comes back to Tesla’s office. The passenger gets out of the Model X in the parking lot, which then moves forward without a human driver, and stops to let a pedestrian safely cross the lot. The Model X parks itself against a curb as the song comes to an end.

Tesla has said that Autopilot is at Level 2 on the autonomous vehicle scale, with a combination of two technologies designed to make driving easier. The new system will be what some organizations, include the Society of Automotive Engineers (SAE) would define as Level 5, which does not have any option for human driving – no steering wheel or controls. Automakers and suppliers are running the gamut over which level they’re supporting in the next few years. Tesla seems to be joining in with Google and Ford in supporting Level 5 fully autonomous vehicles, with Tesla having the potential to bring it first to market.

Tesla shares the viewpoint of Google, and other self-driving car advocates, on the necessity of bringing fully automated vehicles to roads to save lives. During the media Q&A on Wednesday night, Musk addressed the issue, referring to the fatal crashes in Florida and China this year tied to the Autopilot system:

“One of the things I should mention that frankly has been quite disturbing to me is the degree of media coverage of Autopilot crashes, which are basically almost none relative to the paucity of media coverage of the 1.2 million people that die every year in manual crashes. [It is] something that I think does not reflect well upon the media. It really doesn’t. Because, and really you need to think carefully about this, because if, in writing some article that’s negative, you effectively dissuade people from using an autonomous vehicle, you’re killing people.”

The fully autonomous system will need to gain government approval before it’s allowed to be activated and used by Tesla owners. Tesla said that high-end Model S and Model X vehicles equipped with hardware for full autonomy are already in production, and the upcoming Model 3 will have it as well. Previously built vehicles without the new hardware won’t have the fully autonomous features.

During that conference call, Musk said his goal is to demonstrate a vehicle traveling in fully autonomous mode from Los Angeles to New York by the end of 2017. Autonomous features will be introduced gradually over a period of time, and will be based on what Musk called “Hardware 2.”

The software for reaching the fully self-driving mode will need to be validated, and the new system still need to be approved by regulators. Tesla expects to reach those milestones in time, which Musk said would be much safer than cars currently on roads driven by humans.

“It will take us some time into the future to complete validation of the software and to get the required regulatory approval, but the important thing is that the foundation is laid for the cars to be fully autonomous at a safety level we believe to be at least twice that of a person, maybe better,” Musk said Wednesday.

The Tesla blog article, posted Wednesday, describes the new fully automated system. It will provide eight surround cameras with 360 degrees of visibility around the car at up to 250 meters of range, compared to one camera in previous Tesla vehicles. Twelve updated ultrasonic sensors improve the range, allowing for detection at nearly twice the distance of the prior system. A forward-facing radar with enhanced processing provides additional data through whatever weather and lighting conditions the vehicle is traveling through.

The question of whether Tesla will follow a similar path as is being tested by Uber, General Motors and Lyft, and Ford’s strategy to integrate autonomous systems to ride-hailing services, was clarified on Thursday. Yes, Tesla will be entering that space, and it will be called Tesla Network.

Tesla posted a disclaimer to its website on Thursday providing more information to a comment Musk made Wednesday. He said Tesla is building new vehicles with the necessary hardware to eventually enable full autonomy.

“Please note that using a self-driving Tesla for car-sharing and ride-hailing for friends and family is fine, but doing so for revenue purposes will only be permissible on the Tesla Network, details of which will be released next year,” read the Tesla website disclaimer.

The concept was originally announced by Musk in his July blog post, “Master Plan, Part Deux.” The Tesla CEO outlined a system in which a Tesla owner could add a car to a shared Tesla fleet using a mobile device app, allowing it to “generate income for you” and lower the cost of ownership. Musk said that in cities where car ownership is lower, Tesla would operate its own fleet.

This Week’s Top 10: Apple backing away from building cars, California clean vehicle rebate revised

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…….

Apple backs off: Apple Inc. has dramatically scaled back Project Titan, with a new business plan based on partnering with automakers rather than becoming one. Apple has made hundreds of job cuts and reassignments and has taken a new direction, according to people familiar with the project. Apple seems to be taking a similar approach as Google; Apple will be focusing on developing an autonomous (and, most likely, electric) driving system that gives the company flexibility to partner with existing carmakers or to go back to designing its own car in the future, sources said.
California rebates revised: California’s Clean Vehicle Rebate Project (CVRP) is implementing increased incentive levels for lower-income consumers and new high-income eligibility caps, according to a release yesterday by the Center for Sustainable Energy. Following a public workshop held Sept. 30, the California Air Resources Board issued the program updates, as directed by a legislative act. They will apply statewide to consumers who purchase or lease rebate-eligible vehicles effective Nov. 1, 2016, providing lower-income consumers an additional $500. Rebates vary by vehicle type. For the average consumer, they are $2,500 for battery electric vehicles (BEVs), $1,500 for plug-in hybrid electric vehicles (PHEVs) and $5,000 for fuel cell vehicles. For lower-income consumers, CVRP rebates for all types of eligible light-duty passenger vehicles are increasing by an additional $500 for a total of $2,000 more per rebate ($4,500 for BEVs, $3,500 for PHEVs, and $7,000 for fuel cell vehicles). When combined with the maximum federal tax credit for eligible vehicles, the increased rebates provide savings of up to $12,000 for BEVs, $11,000 for PHEVs and $15,000 for fuel cell vehicles. See the press release for more details.
NextEV opens office: Chinese electric-car startup NextEV opened an office last week in Silicon Valley at a well-attended event. Founder William Li, a Chinese entrepreneur who created online car sales company Bitauto, has plans to build a series of electric and autonomous cars that that will at first be sold in China and then to consumers around the world. Li recruited former Cisco CTO, Padmasree Warrior, to lead his U.S. division. At the event, Warrior described the company’s mission is “to change transportation.” NextEV also has entered the Formula E electric racing series and has its own racing team. For the 2015/16 season, NextEV is registered as one of eight manufacturers in the series and is racing with a self-designed powertrain. The NextEV Formula E Team is also set for the 2016/17 season.
Gauging trucking fuel economy rules: The University of Michigan’s Transportation Research Institute conducted a survey with 96 heavy-duty fleet managers who operate a combined total of just over 114,500 truck-tractors and approximately 350,000 trailers. Biodiesel blends (B5, B10, and B20) have been the most common alternative fuels in use, according to the survey. Fuel-saving technologies have played a big part in fleets getting closer to meeting federal fuel economy and emissions rules, with the most common fuel-saving technologies on truck-tractors being aluminum wheels, speed limiters, and low-rolling resistance dual tires. As for using alternative fuels, fleet managers appreciate lowering operating costs, reducing emissions, and availability of alternative fuels.
Solar partnership: Tesla and Panasonic have entered into a non-binding letter of intent to collaborate on manufacturing and production of photovoltaic (PV) cells and modules in Buffalo, N.Y. The agreement is contingent upon shareholders’ approval of Tesla’s acquisition of SolarCity next month. Tesla will use the cells and modules in a solar energy system that will work seamlessly with Powerwall and Powerpack, Tesla’s energy storage products. With the aid of installation, sales and financing capabilities from SolarCity, Tesla will “bring an integrated sustainable energy solution to residential, commercial, and grid-scale customers,” according to the Tesla blog.
Maven comes to SF: General Motors is bringing its Maven car-sharing program to San Francisco, the ninth city in the network. Maven, which debuted in January, is already available in Ann Arbor, Mich., Baltimore, Boston, Chicago, Detroit, Los Angeles, New York City, and Washington, D.C. San Francisco has been a hub for carsharing and ridesharing, with several companies starting up there and setting up headquarters. Maven will compete with Zipcar, Evercar, Getaround, Turo, and City CarShare. Maven customers can rent GM models such as the Chevrolet Volt, Chevrolet Malibu, and Chevrolet Cruze, as well as luxury Cadillac models like the Escalade, and eventually, the Chevrolet Bolt.
Warning on Autopilot: Germany’s Federal Motor Transport Authority (KBA) had written to Tesla asking the electric automaker to stop advertising its vehicles as having an Autopilot function because this might suggest drivers’ attention is not needed. On Friday the KBA wrote to Tesla car owners, warning them that their vehicles could not be operated without their constant attention and that under traffic regulations they must remain alert.
RNG and NZE in refuse: Renewable natural gas from waste resources and near-zero emission engines are revolutionizing clean refuse collection operations. On Tuesday, Oct. 25 at 10:00 a.m. PDT, Southern California Gas Company is hosting a one-hour webinar to learn about technology and implementation options for low-carbon, near-zero tailpipe emission refuse fleets. Topics covered will include: How the combination of ultra-low NOx natural gas engines and renewable natural gas technologies can help meet state emission targets; resources available to analyze the cost and emission benefits of renewable natural gas and a near-zero-emission engine project (“RNG+NZE”) for your refuse operations. Click here to register.
Renewable energy increasing: Carbon-dioxide (CO2) emissions from electricity generation during the first six months of 2016 were the lowest since 1991, according to the U.S. Energy Information Administration (EIA), with most of that coming from the displacement of fossil fuels with renewable energy. Coal saw the more dramatic decline, with consumption decreasing by 18 percent, compared to 1 percent for natural gas. Use of renewable-energy sources increased 9 percent during the first six months of 2016, compared to the same period in 2015.
Workhorse makes deals with BMW and UPS: Workhorse Group announced that BMW i has signed a multi-year supply agreement for BMW i3 range extender (REx) units for the Workhorse E-Gen electric delivery vehicle. The Workhorse E-Gen delivery vehicles are used by last mile delivery companies to fulfill their customers’ delivery needs, the company said. Workhorse also announced that it has received an order to produce 200 additional E-Gen hybrid electric delivery trucks for UPS’ alternative fuel and advanced technology fleet. Workhorse is also known for its FAA compliant unmanned aerial systems (UAS) delivery drones.

Delivery facing rapid change and growing demand in crowded metro areas

ford-transit-connect-van Delivery is seeing a fast-changing environment, from packages to food. Delivery vans and small, high mileage cars (especially hybrids) are passing through a paradigm shift in who owns the vehicles and how they’re being used. While the U.S. won’t be switching over to delivery bikes and three-wheelers, commonly used in crowded Asian and European cities with narrow streets, competition for leadership in delivery services is getting fierce.

Some of this drive is coming from Amazon and Google taking on UPS and FedEx. The U.S. Postal Service is undergoing its own change. On the food side, the classic pizza delivery model is being taken over by app-based alternatives like UberEats, Postmates, and GrubHub. Companies entering the space also point to the state of fast-growing cities squeezed with bigger buildings, more cars and pedestrians, and less parking spaces. Delivery companies need to have smaller, nimble, and quick vehicles to meet surging demand. Younger consumers are getting spoiled by services like Uber and Lyft, where you can tap your phone and have a car in front of your place in less than 10 minutes. Older generations are tapping into these convenient services as well, in this new age of the on-demand economy.

Demand for quick delivery is driving change, along with the challenge of driving and parking in crowded city streets. Some of the carriers also support sustainability, removing vehicles from roads and switching over to alternative energy sources for their vehicles. UPS and FedEx have led the way here. Independent contractors delivering restaurant meals and fast food are preferring to drive a Toyota Prius or a small gas-engine car to keep costs contained.

The Ford Transit Connect van (as shown in the photo above) has been a hot commodity for deliveries. The 2017 model has an EPA-estimated rating of 29 highway mpg when equipped with the available 1.6L EcoBoost I-4 engine. It has substantial storage capacity for such a small vehicle – with 103.0 cubic feet of storage capacity designed for easy maneuvering and parking on tight city streets. The Azure electric Transit Connect van left the market in 2012 and doesn’t appear to be coming back. The other increasingly popular model for urban deliveries has been Mercedes-Benz’s Sprinter utility van. The next-gen edition may get an all-electric powertrain, according to the Detroit Bureau. The automaker is designing the vehicles with both batteries and autonomous-driving features; these features will be available as soon as 2018, the publication reported.

The federal postal service, which was originally created in 1775, took on another form in 1971 when it was transformed into the U.S. Postal Service as an agency of the U.S. government. Within that decade, rival carrier UPS would experience substantial growth in the U.S. and overseas and Federal Express had its first profitable years.

A few years back, USPS was outsourcing a lot of its package delivery to UPS. That started to change recently, especially with the promotion of postmaster general Megan Brennan last year. Under Brennan, USPS has ramped up same-day delivery in order to compete with rivals FedEx, UPS, and Amazon for the growing share of packages with tight delivery schedules. During this time, USPS made a deal with Amazon.com to deliver groceries in selected cities for Amazon when the online retailer wasn’t able to meet that demand.

Amazon is investing heavily to compete with UPS and FedEx in same-day deliveries. Amazon is trying out a few new services including Amazon Prime package deliveries and Amazon Fresh food delivery. Amazon Flex and Middle Mile Providers have recently started up in a few U.S. cities. If you ever see a white Ford Transit Connect with an Amazon logo, that van will be delivering goods through one of the new services.

Dave Clark, senior vice president of worldwide operations and customer service for Amazon, commented on Amazon Flex at an industry conference last year. Amazon Flex is an app-based delivery platform that “enables people to be their own bosses while earning $25 or more an hour,” making Amazon Prime Now deliveries, he said. Drivers will use their own car and smartphone, similar to other popular delivery and ride-hailing services on the market. Amazon is usually promoting an offer for customers that includes free two-hour deliveries. The claim of paying drivers up to $25 an hour sounds quite optimistic, since drivers at other mobility services are typically making $10 to $15 an hour.

With Middle Mile Providers, fleet owners with carrier licenses through the U.S. Department of Transportation will be able haul loads for Amazon. Drivers must be employees of the delivery provider and will likely be required to carry commercial driver’s licenses. They need to drive a cargo van or similar vehicle with at least 200 cubic feet of volume. It appears to be in startup phase with job openings listed in Seattle for a division called Middle Mile Logistics Technology.

In June, Amazon launched a British version of its AmazonFresh food delivery service to break into the UK grocery market. AmazonFresh has previously been deployed in a few U.S. markets, too.

UberEats is counting on the food delivery service being worth the investment. Started in test mode about two years ago, it became its own mobile app in the spring of this year. Uber launched food delivery in Chicago, Houston, Los Angeles, and San Francisco earlier this year. The initial launch was in Toronto; other growth markets include Atlanta, Austin, Dallas, Melbourne, New York, Paris, Seattle, and Washington, D.C. After trying it out as part of the Uber experience, the company realized that didn’t make sense, with both of these experiences being separate from each other; they needed their own brand names and separate mobile apps.

Self-employed drivers are asked to gather in select parking lots for UberEats and pickup packaged orders for the day from partner food services. They’ll deliver lunch or dinner to workplaces or homes in the vicinity. That differs from other food delivery services where the driver will be picking up food orders directly from the vendors and delivering them to the customers.

Food delivery has been taking off like a rocket trajectory over the past year in transactions. Making the business profitable and finding the right financial backing has been tough. Bloomberg reported a story last week about on-demand meal delivery service Caviar’s parent company trying to sell it off and find better partners in food delivery. Payment processing company Square reportedly tried to unload Caviar early this year. Square reportedly had discussions with Uber, Grubhub, and Yelp between late last year and the start of 2016, but disagreements on pricing ended the talks. With Square backing away, startup Caviar is in a tough position in a very competitive market.

UK’s Deliveroo was funded about £250 million ($306 million) earlier this year, and Berlin-based Delivery Hero was rumored to be lining up an IPO, according to VentureBeat. In the U.S. GrubHub, DoorDash, and Postmates have grabbed a lot of attention; Uber and Lyft riders are known for tapping into these delivery services and tend to look for special discount promotions on meals. Private equity funds are coming in for these food delivery companies, but they haven’t been perceived yet as hot commodity investment opportunities like Uber has been able to win over. Postmates is working hard to be seen as unique in the marketplace – the only delivery service out there that will pick up orders from anywhere that the customer requests – a restaurant, donut shop, BevMo! liquor store, grocery store, 7-Eleven, or some other business.

The business model for food delivery companies was borrowed from Uber and Lyft, with a similar mobile app; driving directions and alliances with Waze and Google Maps; it’s all right there on the phone for customers, from ordering to paying; there are special offers with local and chain restaurants, juice bars, coffeehouses, and fast food stores; and all the drivers are independent contractors passing basic vehicle and driving record checks.

Google has been getting ready to take on Amazon Prime for a leading position in fast, on-demand deliveries and has backed away from food delivery. Brian Elliott, general manager of Google Express, told Business Insider that the company plans to spread its coverage from about 20 states and regions to the entire country by the end of the year. To get there, Google Express decided to close down part of its grocery business and stop selling perishables; these were pilot projects started earlier this year in parts of San Francisco and Los Angeles.

Fast delivery is becoming more important for firms to retain their market presence. Amazon was getting a lot more searches and orders placed on a wide variety of products like bottled water and flat screen TVs. Google Express was a way for Google to reinstate itself as the go-to choice for product searches, and to make it easier for people to purchase the goods they’d searched for.

This Week’s Top 10: Fisker Inc. bringing ‘spiritual successor’ to market, Tesla doubling Fremont plant size

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…….

Fisker Inc.: Henrik Fisker is bringing his brand name back to the electric car space through Fisker Inc., which will be launching a car he refers to as the “spiritual successor” to the Fisker Karma plug-in hybrid sports car. The new model will probably be all-electric, and will be revealed in the second half of 2017. He says it will have a driving range of more than 400 miles, and will come equipped with an industry-leading battery life that will potentially match the life of the vehicle. The company has a battery division called Fisker Nanotech based in northern California. Jack Kavanaugh will serve as chairman of Fisker Nanotech, while Fisker will be chairman and CEO of Fisker Inc. He will lead other business units including being head of design and product strategy at VLF Automotive, the company he founded with former GM executive Bob Lutz and Gilbert Villarreal in January 2016. Fisker Automotive went through a structured bankruptcy auction in February 2014, where Wanxiang Group bought certain assets, excluding the Fisker brand name. Fisker also retained his logo, as you can see in this article.
Tesla doubling plant size: Tesla Motors has filed for a zoning proposal in Fremont, Calif., to double in size its assembly plant and meet a 500,000 vehicle annual production goal. In May, CEO Elon Musk said the company would be building a million vehicles a year by 2020, but that will also involve setting up more factories overseas. Tesla has set a goal of producing 500,000 Model 3s a year from 2018 to 2020. Earlier this year, the company said that about 373,000 pre-orders of the Model 3 had been placed. Tapping into the capital needed to ramp up factories will be difficult for the company. Last week, Goldman Sachs downgraded Tesla Motors soon after Morgan Stanley did the same. That came at a bad time – right before Musk begins rallying investors for a new fundraising round.
Battery partnership: Faraday Future announced a partnership last week with LG Chem to supply lithium-ion cells for the startup’s electric supercars. Both companies have agreed to collaborate on EV battery technology that they say will have the world’s highest energy density for a production automotive battery. These cells will be incorporated into Faraday Future’s VPA platform, the company’s “universal and scalable modular battery structure.” LG Chem says it now has more than 20 global automaker as customers.
Formula E: Mercedes-Benz will be gearing up to race in the 2019/18 Formula E electric racing series. Pending approval from FIA World Motorsport Association, Mercedes-Benz’s British-based subsidiary, Mercedes-Benz Grand Prix, hopes to bring its experience in motorsports over to electric racing. The automaker gained a lot of electrified racing experience through its hybrid Mercedes-AMG Petronas Formula One racer. Mercedes-Benz is expected to use Formula E as a marketing platform for its newly created EQ electric car sub-brand.
Concerns over Autopilot 8.0: Consumer Reports tested out Tesla’s new Autopilot system 8.0 upgrade. The changes were appreciated, and the magazine encouraged the automaker to keep working on making the system safer. One issue is that drivers have time to drive hands-free for about a minute and even longer on highways. The publication thinks the Autopilot name should be changed, since it’s not really in autopilot mode. There’s also concern that system remains a beta release. Tesla CEO Elon Musk had said last month the system isn’t really a true beta release, but the company labels it a beta release to reduce people’s comfort level when turning the system on – keeping them more aware and safe.
STORM electric motorcycle trip: Cal State LA College of Engineering, Computer Science and Technology and EcoCAR team today are welcoming on campus a team of students from Eindhoven, Netherlands, going around the world in 80 days with their STORM Wave electric motorcycle. STORM Eindhoven left the Netherlands to tour the world on Aug. 14, and traveled through Europe, the Middle East, and China before coming to the U.S. A short impression of their tour so far can be found through this link. The motorcycle runs on a battery pack designed by Eindhoven students. The pack consists of 24 cartridges that have 28.5 kWh of energy, which enables the motorcycle to travel 380 kilometers (236 miles) on a single charge. It is possible to adapt the whole pack to enable a lighter motorcycle for a more sporting driving style. The bike will travel down the West Coast and through the South and Midwest before finishing its tour of America in New York on Oct. 26. STORM will make stops in Sacramento, San Francisco, Los Angeles, Phoenix, Dallas, Columbus, and Pittsburgh, among others. During each stop, the STORM team will meet with universities and companies interested in smart urban planning and sustainability to demonstrate the potential of sustainable transportation and recharge the motorcycle. Track and trace the team live on this page.
EPA on ethanol blends: A new U.S. Environmental Protection Agency proposal would reclassify ethanol blends above E15 as “ethanol flex fuels,” potentially opening the door to wider use of these blended fuels. The proposal would place fuels with 16 to 50 percent ethanol in the same category as E85. The agency believes its proposal could encourage more interest in flex-fuel vehicles and the “blender pumps” needed at fueling stations to add greater amounts of ethanol to gasoline. Some gas station owners have expressed concern that there’s a lack of consumer interest in blends of E15 or higher, and the cost of installation isn’t worth it. It’s not clear whether the new proposal will settle the oil vs. biofuel industry battles, or if advanced biofuels would be supported through the revised rules. The EPA is expected to put its new proposal for adding more ethanol blends to the flex-fuel category up for public comment in the near future.
Hydrogen and fuel cell day: U.S. Department of Energy’s Argonne National Laboratory released a Q&A guide to commemorate October 8th as National Hydrogen and Fuel Cell Day. Check out the Six Things You Might Not Know About Hydrogen guide. Here’s an interesting one: The day is celebrated on October 8 (10/08) because the atomic weight of hydrogen is 1.008 atomic mass units…. Hydrogen can also be used as a way to store energy, and this use has the potential to have a large impact on our future…….. Current commercial fuel cells use platinum, a rare and expensive metal, as the catalyst. Researchers are working on new catalysts that use less of this expensive metal, or that don’t need platinum at all……. Argonne operates four different divisions where labs conduct research on hydrogen and fuel cells.
Wheego and Valeo win self-driving car permits: Wheego Electric Cars and Valeo North America have received permits to test self-driving cars on public roads in California. Wheego is based in Atlanta and is led by former EarthLink Inc. president Mike McQuary to design and sell electric vehicles. Valeo is a unit of French auto supplier Valeo SA, which joins several other parts makers trying to develop technology that auto makers may need to put self-driving cars on the road. Cruise Automation received a permit before General Motors Co. in March agreed to acquire the startup in a deal valued at $1 billion.
48V taking off: Navigant Research just published a report on the increasing importance of 48V systems adding to fuel efficiency and performance. While 12V has been the standard for many years, 48V is taking off for stop-start systems combined with other technologies including electric turbochargers that can increase efficiency in traditional gas engine vehicles without the adoption of hybrid or plug-in vehicle capability. For comparison purposes, several plug-in electric vehicles have battery packs with about 360 volts. According to Navigant Research, global sales of light duty stop-start vehicles will exceed 61 million by 2025, accounting for 59% of all light duty vehicle sales. Of these, about 15% will feature 48V components.