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Tesla Model 3 leads electric vehicle sales in January, Fuel prices climbing up

Tesla Model 3 leads plug-in sales: The Tesla Model 3 is now the top selling plug-in vehicle in the U.S., even if Tesla is still behind on its original production forecast from last year. The 1,875 sales total for the Model 3 for January comes from Inside EVs. It’s based on about 860 units being sent to customers at the end of the quarter, which are expected to be counted as deliveries in Q1 2018. The company also said that it was reaching a production rate of 1,000 units per week following the end of Q4 deliveries. The Toyota Prius Prime took the second spot at 1,496 units sold; the Chevy Bolt came in at 1,177, the Tesla Model S had 800 units sold in January, and the Chevy Volt had 713 vehicles sold. Plug-in vehicles had a better January in the U.S. than the overall light-duty vehicle sales market. Autodata Corp. reported a 1% increase at 1.15 million new vehicles sold last month. Inside EVs estimates that battery electric and plug-in hybrid vehicle sales went up about 10% from last year, with 12,116 units sold in January 2018 compared to 11,004 in January 2017.

Nissan and Infiniti launching six EVs: Nissan and its Infiniti luxury brand will represent half of the 12 EVs that CEO Carlos Ghosn committed to last year for the Renault-Nissan-Mitsubishi Alliance. Toshihiro Hirai, Nissan’s corporate vice president for powertrain and EV engineering, said that Nissan will be rolling out four all-electric vehicles and Infiniti will launch two all-electrics over the next five years. Like the Nissan Leaf, these new models will be battery electric vehicles. They won’t be utilizing the company’s new E-Power system, which uses a small gasoline engine to generate power for an electric motor.

Fuel prices climbing up: Gasoline prices have gone up in the past week in several states. The national average is at $2.605, according to AAA. A year ago it was $2.270, and it’s up from $2.490 a month ago. Diesel is at $2.998, up from $2.509 a year ago and $2.893 a month ago. As for the price of a barrel of oil, West Texas Intermediate (WTI) crude oil has gone up from $53.01 on Feb. 6, 2017 to $64.73 today.

Hawaii and California have the highest gasoline prices, at $3.391 and $3.344, respectively. Hawaii is usually one of the highest, with the additional cost of shipping petroleum to the islands built into the cost. California is usually higher than the national average, but prices have been spiking up in the past few months. Starting in November, California motorists have been paying 12 cents more per gallon for gasoline and 20 cents more for diesel. This came from state tax increases being used to improve road conditions.

New vehicle sales haven’t been affected by fuel price increases yet. Trucks were up 8% in sales last month while cars were down 10.8% with small and mid-size cars down even further. Hybrids and plug-in vehicles were up in sales last month, but they still only make a small percentage of total sales – hybrids at 1.91% and plug-ins at a little over 1% of total U.S. light-duty vehicle sales in January. The University of Michigan’s Transportation Research Institute has seen the sales-weighted average fuel economy in new vehicle sales hover around the 25.0 to 25.3 mpg mark for several months.

But fuel prices are expected to go up this year. Average prices could climb by more than 10%, in the near future says Patrick DeHaan, head of petroleum analysis at Boston-based GasBuddy, which monitors fuel prices across the U.S. One OilPrice.com analyst predicts that the price of a WTI barrel of oil will go up from its current $64.73 to about $70 a barrel in the near future.

Gas pump prices have always made for a strong argument to consumers and fleets over buying more fuel-efficient vehicles including hybrids, plug-in vehicles, and alternative fuel vehicles. It was weakened in the summer of 2014 with falling pump prices. That argument will become stronger as fuel prices continue to rise.

Flagship green car Toyota Prius approaching redesign and diminishing influence in market

The Toyota Prius has been a flagship for Toyota Motor Co. for about 15 years – and the automaker is counting on the redesigned 2016 model to restore its image as the leading green car on the market. Spy shots show that its body style is changing and will be more in-line with the revamped 2016 Chevrolet Volt; and the mileage will be getting better – sources say the standard Prius hatchback (sometimes called the “Liftback”) will go from a 50 mpg rating to 54 mpg on the window sticker. Toyota faces steep challenges in getting Prius sales back toward upward trending with gasoline prices being where they are; and stiff competition coming from small, fuel-efficient cars and competing alternative technologies.

If you study the chart above with the entire Prius model lineup, you’ll see sales dropping for all the variations – with the big one being the Prius Plug-in Hybrid dropping about 70% from a year ago and the mothership model down about 15%. Nationwide, Prius sales fell 12% last year to 207,372 units sold. The Prius had been the No. 1 new vehicle model sold in California during 2012 and 2013, but that model was beaten last year by the Honda Accord.

Toyota seems to have lost its commitment to assembling and delivering its Prius Plug-in Hybrid to its dealer network. Pricing is higher than the Prius and Prius C, even with the $2,500 federal tax credit and state incentives on the plug-in version, which makes it more challenging to sell; but a few years ago, the Prius Plug-in Hybrid was doing very well in new vehicle sales, sometimes selling more than the Chevrolet Volt. Less than 500 units (464) were sold in June; for comparison, in March 2015, 473 units were sold and in June 2014, 1,571 units were sold in the U.S. Toyota decided to cease production of the Plug-In Hybrid in June; the company said it was working hard at developing the next generation of the Prius Plug-in Hybrid and will be sharing details on the launch date. The recent decision to extend the launch of the Prius Liftback, C, and V, could push off the next generation Plug-in Hybrid as far as the second half of 2016 as a 2017 model.

It’s very typical to see fleet applications of the standard Prius model these days in taxis and in company cars. Toyota hasn’t released data on its fleet sales, but it does offer fleet incentives – for 2016 models, there will be a $500 incentive for the hybrid lineup (Prius, Prius C, and Prius V) versus a $1,000 incentive for the popular Toyota Camry sedan. The Prius Liftback comes in five levels with Two through Five being priced at a bit over $25,000 to just over $30,100. The level One is priced $1,000 less than the Two trim level and is reserved for fleet customers.

For Toyota Motor Sales, Toyota’s US division, seeing a lot of Prius taxis being used in markets like New York and Los Angeles isn’t very appealing. “I hate to see Toyotas in taxi fleets but (it) does create an image for us,” said CEO Jim Lentz in 2013. Taxi operators and drivers like the fuel efficiency and ample passenger room in the backseat and trunk area. The Prius is a very good car to drive on crowded city streets, being small and nimble with enough torque to cut through traffic openings.

A Toyota dealer in Texas thinks the Prius makes a lot of sense for Uber drivers to save money on their passenger trips. Toyota of Plano is offering hefty discounts and targeted online advertising to Uber drivers – and now is selling about 200 cars per year to these drivers, or 6% if its 3,200 cars sold per year.

The dealership likes it very much as a rolling advertisement for the Prius – as drivers pick up passengers and tell them how much they love their Prius. The dealership doesn’t mind offering great rebate incentives to Uber drivers. “If I lose $1,000 to sell a car and [an Uber driver] sends me three customers,” general manager Rusty Gentry said, “I still come out ahead.”

The future of hybrids has been called into question with moderate gas prices and fuel efficient cars and crossovers becoming more popular. Nissan has killed the hybrid version of its Pathfinder crossover as consumers look increasingly to other Nissan products. Hybrid sales numbers have been declining as a share of nationwide new vehicle sales, especially after gasoline prices started dropping in the summer of 2014. Toyota continues to try out a broad spectrum of technologies and vehicle categories to secure its spot as the No. 1 automaker in global sales – and as an innovator embracing new technologies. Lately, the Toyota Mirai fuel cell vehicle has become Toyota’s favorite alternative technology vehicle to show off.

CFA study shows that gas prices will continue influencing vehicle acquisitions and next-generation engineering

The per-gallon price of gasoline has a huge impact on the auto industry – sales of small cars, hybrids, and electric vehicles compared to trucks and SUVs; resale values of these segments; and capital expenditures by OEMs. Expectations of where oil prices will go in the next two years will play a big part in new vehicle purchases and what OEMs decide to place in their product pipelines. A new study says that US consumers don’t expect gas prices to fall as far down as they did in recent years – and that prices will be going up soon.

The latest national survey on consumer attitudes by the Consumer Federation of America (CFA), reported that US consumers expect the national gasoline price average to rise by almost 50% in the next two years – from about $2.14 to $3.20 – and by over 80% in the next five years – to $3.90. While gas prices dropped dramatically in the second half of 2014, consumers are still building these price increases into their next vehicle purchase.

The fuel price volatility experienced in 2008, and again in 2010, has made a lasting impact on consumer attitudes. More than four-fifths (86%) of survey respondents said that gas mileage will be “important” in their next purchase, while over half (57%) say it will be “very important” in determining what vehicle to purchase.

Fleet acquisitions will likely be met with similar considerations. According to fleet industry coverage (such as articles in sibling publication Fleet Management Weekly), fuel prices and fuel efficiency are up there with telematics, vehicle safety, emissions, and functionality as key factors in making fleet vehicle acquisitions.

Major automakers, including commercial truck manufacturers, are going to continue to invest in alternative fuel vehicles and advanced vehicle technologies. Their executives predict that global demand for fuel from fast-growing economies like China, India, and Brazil, will push gas prices higher in the next two years and beyond.

In the end, financial concerns are driving interest in fuel efficiency. “Buying an inefficient vehicle during periods of low gas prices condemns the consumer to wider swings in monthly costs, much higher monthly peaks and a whopping overall increase in lifetime gas costs,” said Dr. Mark Cooper, CFA’s Director of Research, about the CFA study.

Cheap oil raises the bar on Obama policies and alternative fuels gaining support

As oil barrel and gas pump prices stay down, adopting and enforcing environmental policies and gaining support for alternatives like electric, hydrogen and advanced biofuels are seeing higher hurdles to cross over. Here’s a look at what effect it may have in Washington – along with forecasts from Navigant Research on where electric vehicle sales are likely to be heading……….

Automakers are expressing concern about meeting the 54.5 mpg corporate average fuel economy mandate by 2025; and oil companies say the decline in oil revenue means the industry can’t afford stringent climate regulations. OEMs and “big oil” might be more resistant to supporting these policies in the US and abroad.
Sales have been increasing for pickups, minivans and SUVs that they’d shunned when gasoline as $3 or more a gallon. Automakers have been counting on stronger demand for hybrids and EVs to meet the 54.5 mpg target.
Climate change had been a key theme during Obama’s two presidential campaigns. Reducing carbon emissions at power plants has been a leading policy initiative, along with funding for clean energy and renewable-energy projects on public land. As for fuel efficiency and greenhouse gas emissions reductions in passenger vehicles, EPA Administrator Gina McCarthy says the administration isn’t willing to ease off fuel economy and sees it as a “long-term investment” for the industry.
While light-duty vehicle sales will continue increasing with global demand, studies by International Energy Agency (IEA) and ExxonMobil see efficiency leveling out the playing field. Exxon projects passenger vehicles will rise from 825 million in 2010 to 1.7 billion in 2040, with sharp gains in fuel efficiency offsetting the rise. That will come from an increase in global average fuel economy going up to 45 mpg in 2040, up 60% from 2010. New vehicle technologies like turbocharging will have a lot to do with the increase; increased hybrid sales will also contribute to those numbers.
Commercial transportation will cause energy demand to grow during that time. Exxon expects that by 2025, heavy-duty vehicles are likely to surpass light-duty vehicles as the largest energy-consuming segment in transportation. China and India are expected to account for about 30% of the global growth in demand for energy for heavy-duty vehicles, and the US and Europe combines should account for only about 10%. Economic growth will drive demand for heavy-duty vehicles, marine, aviation, and rail.
Navigant Research expects the total for light-duty electric vehicles to grow from 2.7 million electric vehicles sold by the end of 2014 to at least 6.4 million by 2023. Fuel efficiency advances being deployed within internal combustion engines like stop-start technologies and lightweight materials will play its competitive part in the market. On the commercial vehicle side of the business, Navigant expects global sales of electric drive and electric-assisted trucks and buses to grow from less than 16,000 in 2014 to nearly 160,000 by 2023.
Reading these media and research reports illustrates that making the case for clean transportation can be most effectively stated by emphasizing a few themes: reducing greenhouse gas emissions and petroleum consumption; accessing more stable energy markets and pricing trends such as electricity, natural gas, and propane; being less dependent on foreign oil imports and vulnerable to price volatility; and supporting US job creation and cleantech and clean transportation industry growth through vehicle acquisitions, infrastructure, and capital investments.

Significant clean transportation news events in 2014

Green Auto Market hopes you’re having a great holiday season away from the office. Before the new year begins, here are 10 leading events from this year (and a few “almost made it” at the end of the list) that will have rippling effects on 2015………

Gasoline price drops – On Friday, AAA Daily Fuel Gauge Report said that US regular gasoline prices had averaged $2.32 per gallon versus $3.26 one year ago. As explored in another Green Auto Market article this week, gas prices will go up quite a bit but it could take about five years for that to happen. Sales of hybrids, electric vehicles, and natural gas vehicles have been impacted by that market force. Making the case for investing in alternative fuel vehicles is getting tougher for fleets and consumers, but there are still a few solid reasons for going in that direction.
Tesla battles dealers – The Georgia Automobile Dealers Association has been the latest state dealer group to battle Tesla Motors’ legal ability to directly sell its cars to consumers outside independent franchised dealers. Earlier this month, Georgia auto dealers testified before a state administrative law judge to make that case. Tesla is slightly ahead of dealer associations on this issue in several states, but has been barred in a few of them (such as the sizable market of Texas).
Google rolling out self-driving cars – Google’s launch of a test project featuring its own self-driving pods back in May of this year fueled a heated debate that went viral on the internet. Autonomous vehicles, also known as driverless and self-driving cars, led to significant studies being launched (such as Hands off the Steering Wheel), automaker announcements, and extensive media coverage. It will take a few years to see autonomous vehicles next to you on roads, but things are changing.
Infrastructure growth – In the past year, alternative fueling and charging stations saw some growth in the US – compressed natural gas (CNG) stations increasing 150 stations to 794; electric vehicle public charging stations increasing 2,102 to 8,814; propane autogas increasing 44 to 2,715; and liquefied natural gas increased 19 to 64 stations (according to Clean Cities Alternative Fuels Data Center). Clean Energy Fuels played a big part in the natural gas station expansion; and California started seeing more hydrogen stations open up.
Ridesharing service Uber has become Public Enemy No. 1 this year for the taxi industry and other ground transportation services. This San Francisco-based network company makes mobile applications that connect passengers with drivers of vehicles for hire and ridesharing services. Taxi drivers have protested this year in US and European cities; they’re furious that Uber drivers don’t have to pay the steep prices for taxi licenses that taxi drivers end up paying off over several years. India will decide if Uber can access metro markets in that country. Other ridesharing services such as Lyft and Sidecar face similar battles with cities that fear ridesharing will transform the taxi business and take away the revenue that comes from fees paid by taxi owners every year.
Luxury plug-ins had a significant year with the BWW i8 joining the i3 in BMW’s electric vehicle offerings. The plug-in hybrid i8 sells for $136,000 and has the same performance as a BMW 335i. As of Nov. 30, the i3 had sold 5,079 units in the US for 2014– pretty impressive for an expensive luxury electric car.
Propane autogas had an impressive year in school bus fleets, police cars, utility trucks, and in UPS’ decision to bring in 1,000 propane-powered delivery trucks to its fleet. Fleet managers are making a business case that propane-powered vehicles are worth the investment with emissions reductions, fuel cost savings, and supporting domestic fuel providers.
ACT Expo saw attendance growth In Long Beach, and significant partnership announcements including joining up with Electric Drive Transportation Association for the 2015 event. Other clean transportation conferences did very well, too. AltCar Expo saw growth in attendance with a strong Santa Monica, Calif.-conference in September and through its partnerships with the Bay Area and Dallas events. Other successful conferences were North American Green Fleet Forum, presented by Sacramento Clean Cities Coalition; CleanTech OC’s annual conference and clean transportation event earlier this year; Plug in 2014 in San Jose, Calif.; and CALSTART’s annual conference and Blue Sky Awards.
The Renewable Fuel Standard decision by the US Environmental Protection Agency (EPA) was once again put off on biofuel production and gasoline blending until next year – nearly one year after deciding to extend that decision on production volume. The biodiesel industry has been feeling the pinch, and corn ethanol has shifted to overseas markets. Advanced biofuels like biodiesel and cellulosic ethanol will take longer than expected to reach higher production volumes.
While it didn’t get all that much media attention, a major global alliance took a big step forward. The United States and China, which together produce 45% of the world’s carbon emissions, made an agreement to extend their greenhouse gas emission reduction targets farther than before. Details on the US-China greenhouse gas emissions agreement is being decided for next year. China’s economy is booming, and workers are moving to cities to take jobs and housing. They’re buying a lot of cars, too. All of this producing a huge volume of emissions at power plants and vehicles.

Here are some other significant news stories for 2014: Tesla Motors choosing Nevada to set up its “Gigafactory;” California institutionalized its position as leader in the electric vehicle market; the debate over whether hydrogen fuel cell vehicles could make or if electric vehicles should be the only alternative technology supported by OEMs (and why Toyota was choosing hydrogen); NAFA Fleet Management Association and CALSTART moved the Sustainable Fleet Standard Program forward; and the launch of LeSage Consulting in January 2014. The idea for that consulting firm started in February 2013 while talking to my Automotive Digest colleagues and interviewing fleet managers such as NAFA President Claude Masters, an experienced and passionate advocate of clean transportation. (Editor’s note: the decision to put out the press release on the launch of LeSage Consulting at the beginning of this year was going to be delayed several months – until my partner/significant other challenged me to keep my word. Thanks very much, Susan. Special thanks also goes out to Chuck Parker, Nancy Edwards, Ted Roberts, Janice Sutton, and other Automotive Digest colleagues; members of the monthly Stakeholder Editorial Advisory conference calls; and to Long Beach Clean Cities Coalition.)

Where petroleum prices are heading in the next few years

The economic power of the oil industry continues to be more influential than any other business sector in the world; that includes OPEC and non-OPEC oil-producing countries like Canada and Russia, and supply chain partners such as oil refineries. When the price of oil jumps up or down, the economic rippling effect is felt throughout the world; sales of hybrids and electric vehicles are affected and geopolitical issues, such as alliances between countries, are impacted.

When oil, gasoline, and diesel prices spiked in 2008, the term “fuel volatility” became commonly known by fleets and consumers. Sales of hybrid electric vehicles jumped up. Investment in natural gas vehicles and infrastructure – and to a lesser extent propane autogas – had a resurgence not seen since the early 1990s. The oil price spike in the summer of 2008 helped push along the US financial market collapse that started in September of that year – and it also supported the introduction of plug-in electric vehicles (EVs) by the end of 2010. Volatility in fuel prices has given car shoppers more concerns for fuel efficiency and more interest in EVs and other alternative technologies. Oil prices, and gasoline and diesel, did drop back down in 2009 but came back up again in 2011. Those prices stayed up and fairly level until dropping nearly 50% in the second half of 2014.

Even though the US and the world had been hit with the Great Recession, the first EVs produced in fairly large numbers were introduced by major automakers before the economy started recovering. When the Nissan Leaf and Chevrolet Volt were rolled out in late 2010, advertisements for the Leaf and Volt emphasized freedom from oil addiction (such as driving by gas stations) and environmental benefits. Tesla Motors had introduced the limited production volume Roadster in early 2008; its Model S, launched in the summer of 2012, had been able to generate enough enthusiasm long before roll-out to support the company’s 2010 initial public offering and large investments by Daimler and Toyota.

Major automakers expect that within the next five-to-10 years, oil price increases and the possibility of more motor fuel taxes, will drive up prices at the pump. Increasing environmental regulations and fuel economy standards, and the drive toward sustainability targets by corporations and governments, are also influencing those capital investments and new vehicle planning. Major automakers, including commercial truck manufacturers, are going to continue to invest in alternative fuel vehicles and advanced vehicle technologies. Along with fuel price trends, automakers are planning for a fast-changing transportation landscape where they’ll be selling less new vehicles and partnering with other stakeholders in carsharing, autonomous vehicles, urban planning, vehicle safety improvements, and reducing traffic congestion gridlock and air pollution.

If you study the Forbes’ list of the world’s biggest public companies, you’ll see that major oil companies are high on the list and that the annual ranking is becoming more expanded and globalized. China, which became the largest importer of oil in 2013, plays a very visible role on this list. No. 1 on the list is ICBC (Industrial & Commercial Bank of China), which funds a lot of petroleum production. Number 10 on that list is PetroChina, which refines crude oil and petroleum products and is engaged in the exploration, development, production, and sale of crude oil and natural gas. PetroChina was also the largest emitter of greenhouse gas emissions in the world during 2013. Advanced vehicle technologies are in the pipeline, but for now, the power of the global oil industry and its impact on emissions can’t be ignored.

As for the near future, and for the long-term, here are a few market forces to follow that likely will be influencing motor fuel prices………..

While crude oil has been selling for about $55 lately on the WTI exchange, analyst firm Trefis forecasts those prices will reach about $100 per barrel by 2020. Recent price declines in oil should extend for a longer period of time than Trefis had originally predicted; a slower growth demand scenario and the weakened price controlling power of OPEC will extend these current prices longer, but they will be going up to the $100 per barrel range in about five years. Rapid growth from non-OPEC supplies relative to overall demand has been at the heart of the recent oil price drop.
Approval of the Keystone XL pipeline in Washington, DC, appears less likely to happen. Lower gasoline prices and skeptical comments from President Barack Obama may be behind it. While it may be very good for Canadian oil companies, it’s not going to provide much for American consumers, Obama said. That’s the fourth non-supporting comment the president has made publicly since early November on the six-year old proposed pipeline that would run between Alberta and Texas. Several analysts have said that falling gas prices support the argument of Keystone XL pipeline opponents that it’s not worth the investment; Canadian oil isn’t necessary with all the global oversupply that’s already out there.
The US may benefit from these price fluctuations in stabilizing hostile relationships with Russia, Iran, and Venezuela – which face financial collapse with oil price drops. Russia’s former finance minister and long-time ally with Russian president Vladimir Putin has called for his country to improve relations with the US as the oil price drop is creating for them a “full-blown economic crisis.” Putin has been at odds with the US and other countries over Western sanctions after Russia intervened in Ukraine. The Venezuelan government had hoped to continue with the free-spending policies enacted by former President Hugo Chavez, but that’s not likely with oil prices dropping. Iran has been losing about $1 billion a month because of the oil price declines. Long-time Pentagon adviser Edward Luttwak says the price drop, “is knocking down America’s principal opponents without us even trying.”

This Week’s Top 10: Gasoline prices are coming down and what it means, CALSTART announces keynote speakers for its annual conference and awards event

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…….

1. Automotive News ran a lead article yesterday on how gasoline prices are softening and what it means, with a telling headline: “Falling gasoline prices make alternative-fuel vehicles a tougher sell.” The boom in US oil production, more fuel efficient new vehicles being offered to consumers, and a softening global demand for oil, seem to be reducing the price of oil and gasoline sold at retail stations. The US Energy Information Administration thinks that will continue into next year – from $3.45 this year down to $3.38 next year. Automakers are increasing incentives on alternative fuel vehicles to make up for reducing demand in hybrid and electric vehicle sales. Toyota boosted Prius incentives up to $2,300 per vehicle in September from $1,400 a year ago and Ford increased C-Max incentives up to $4,900 from $2,650 in September 2013. Consumer tastes have been shifting away from electrified vehicles toward SUVs and pickups, according to a Kelley Blue Book analyst. Green Auto Market has been concerned about the impact of softening fuel prices on green vehicle sales since coverage of the issue last month. Wearing my consultant/analyst hat, I would say that strengthening sales of alternative fuel vehicles will require clear messages from automakers, dealers, government agencies, infrastructure suppliers, and other stakeholders:
♦Fuel efficiency is still a big driver for car shoppers, says Mike Maroone, COO of AutoNation. Consumers remain vigilant about the risk of another oil spike, even as they gravitate toward trucks, he said. Consumers and fleets are prioritizing fuel efficiency in their purchase decisions. Alternative fuel vehicles have an edge over internal combustion engines on fuel costs during their ownership lifecycles. (I like getting 48 mpg in my Prius, no matter how much gasoline prices may drop.)
♦Federal and state incentives, and those offered by automakers and dealers, will be continuing for a while on electric vehicles, natural gas vehicles, hydrogen fuel cell vehicles, and propane autogas vehicles.
♦The infrastructure is getting better all the time in charging stations and alternative fuel pumps.
♦As mentioned in the article on working with environmental groups (running in its long version this month in Green Auto Market – Extended Edition), there are three strong arguments for supporting alternative fuel vehicles: emissions reductions, reducing dependence on oil, and economic growth with job creation. If you add in the pragmatic lifecycle fuel cost savings, that means there are four good reasons to purchase these vehicles
2. CALSTART has announced two keynote speakers for its Annual Meeting and Blue Sky Awards luncheon. Christopher Grundler, director of the Office of Transportation and Air Quality for the US Environmental Protection Agency, and Dr. Cheryl Martin, acting director of the Advanced Research Projects Agency-Energy (ARPA-E) at US Dept. of Energy, will be speaking at the event on Tuesday, December 9, 2014, in Los Angeles. The CALSTART annual meeting will feature leading public policy officials, investors, and industry leaders with the sole focus of developing new plans and initiatives supporting clean transportation technologies. Leaders in the field will be honored; for over a decade, the Blue Sky Award has been presented annually to companies and individuals who have made outstanding contributions to the development of clean, sustainable transportation, and technologies. You can view the preliminary agenda here; and for more information, to review the agenda and register, you can email Susan Romeo at sromeo@calstart.org.
3. Tesla Motors may add franchised dealers into its retail chain to gain access to states like Texas and potentially Michigan that have banned Tesla selling directly to consumers. “We may need a hybrid system, with a combination of our own stores and some dealer franchises,” Tesla CEO Elon Musk acknowledged during an interview with John McElroy on Autoline Daily. Michigan’s governor is scheduled to make a decision today on whether he’ll be signing into law the state legislature’s decision last week to ban Tesla from selling or operating a gallery. There are no details yet on how this distribution network would be structured, but it might also assist Tesla in building its presence in states with bans or others like New Jersey and Nevada that are allowing Tesla to sell in the states with limited presence.
4. The US Environmental Protection Agency (EPA) will issue revised guidelines by the end of this year on mpg ratings. Christopher Grundler, director of the EPA’s Office of Transportation and Air Quality, says it has much to with the agency’s “coast-down” test that has been the source of mistakes impacting Hyundai, Kia, Ford, and Mercedes-Benz to revise their fuel economy ratings since 2012. During testing, vehicles are sped up to 80 mpg then coast to a step for readings on aerodynamic drag, friction in the drivetrain, and other data points. That data has been going into dynameters for simulations of the vehicle’s performance on real roads. New guidelines will come out clarifying how the test should be conducted, and more accurate audits of automakers’ testing results, Grundler said.
5. China will crackdown on automakers that fail to meet fuel economy requirements on passenger vehicles set to rollout in the 2015 model year. China has standards similar, but stricter, to those being adopted in the US, Europe, and Japan – requiring corporate average fuel economy of 34 mpg in 2015 and 47 mpg in 2020. The rule takes effect on Nov. 1. The Chinese government says it will publicly name automakers, both foreign and Chinese, who fail to meet the 2015 target; and there will be a ban on new vehicles that don’t meet fuel economy targets that will be determined by a special weight-based formula.
6. Kia has been slacking on joining the electric vehicle competition, but it’s got a very cool car, according to the New York Times. The 2015 Kia Soul EV got a rave review for a few reasons, one being its 27 kilowatt-hour battery pack. The EPA gives it a range of 93 miles on a charge, better than other EVs and especially significant for its small car size. The reviewer was able to reach just about 100 miles each time without resorting to extreme eco-maneuvers.
7. Clean Energy Fuels introduced a patent-pending product designed to help fleet operators sequester natural gas vehicles (NGVs) in their existing maintenance facilities. NGV Easy Bay is the “lowest cost separation and vapor containment system available” for NGV maintenance and storage facilities, the company says. It was developed by the company’s facilities modification team, which has been helping potential operators solve problems faced in converting not only their vehicles but their vehicle support installations for natural gas using its code-compliant fabric barrier system.
8. LG Chem predicts it will be the giant in electrified transportation batteries in 2017 – 25% of a $5 billion global market in lithium batteries for battery electric, plug-in hybrid, hybrid, and microhybrid vehicles. Prabhakar Patil, CEO of LG Chem Power Inc., the Korean company’s North American division, thinks that LG Chem will continue to grow despite Tesla Motors’ decision to go with Panasonic at its upcoming “gigafactory” in Reno. Nev. Patil thinks the EV market will grow and is in talks with several automaker about supplying them with batteries. He also thinks it’s pretty questionable that Tesla and Panasonic will be building 500,000 electric vehicles a year.
9. US Energy Secretary Ernest Moniz is impressed with a new biofuels plant in Kansas – he says it represents the future of ethanol production and next-generation biofuels, solar, and fossil technologies that reduce greenhouse gas emissions. The $500 million refinery in Hugoton, Kansas, is now one of three commercially sized facilities in that US that only use plant waste, such as stalks and leaves, for production. That would mean staying out of the “food vs. fuel” debate that plagues the corn ethanol used in E10 gasoline. Abengoa, a Spanish company, opened the plant in late September. The plant has been funded by an Energy Dept. grant and loan guarantee, and it has the capacity to produce 25 million gallons of ethanol per year.
10. General Motors has increased its number of landfill-free facilities up to 122 as 11 more manufacturing and non-manufacturing operations have made the list. These facilities in Asia, Europe, South America, and North America take waste from daily operations and recycle, reuse, or convert it to energy. Three of the 11 sites are in Michigan and one is in California; combined, the 11 added facilities help GM avoid more than 600,000 metric tons of CO2-equivalent emissions

This Week’s Top 10: Selling alternative fuel vehicles as gasoline prices dip, UN Climate Summit in New York revives push for global standards

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…….

While there are several challenges to increasing electric vehicle (EV) and other alternative fuel vehicle sales, I would say that gasoline prices are one that don’t get mentioned enough. The uprisings in Iraq and Syria caused analysts to forecast increases through this year, but that is not the case today. A survey by analyst Trilby Lundberg reported that gas prices have been down 34 cents since the beginning of summer. GasBuddy is predicting the downward trend will continue. The US Dept. of Energy (DOE) estimates the national average gasoline price for all of 2014 will be $3.46 a gallon, its lowest annual average since 2010. The DOE predicts the average will fall again, to $3.41, in 2015. Survey researchers at Indiana University released an exhaustive study that found consumers are misinformed about EVs – with 75% incorrectly underestimating the benefits of the vehicles. Softening gas prices tend to hit hybrids the hardest in new vehicle sales and used vehicle values. With gasoline prices staying down for now, the challenge increases on how to inform consumers and fleets about the gains available through EVs, hybrids, natural gas vehicles, propane, and hydrogen.
The UN Climate Summit took place last week at the UN Headquarters in New York City. It all started on Sunday, Sept. 21 with the People’s Climate March where more than 300,000 people took the streets in the largest-ever climate change rally. The purpose of the conference was to raise support for a worldwide climate agreement in Paris in 2015. In a speech at the summit, President Obama called for a more ambitious global approach to environmental issues; he talked about a new push to boost what the White House calls “global resilience” in the face of climate change. Environmental groups such as Natural Resources Defense Council and Sierra Club were pleased to see the street march on the 21^st, and have called on the White House and US Environmental Protection Agency to stay committed to reducing carbon at power plants and through energy and transportation policies.
US Department of Energy’s Clean Cities issued a reminder on fleets earning credits on the Alternative Fuel Transportation Program. Covered fleets can earn credits for some vehicles that don’t meet the Energy Policy Act of 1993 definition of an alternative fuel vehicle (AFV). The new policy adds half credits for certain hybrid electric vehicles, plug-in EVs, and fuel cell vehicles; and one quarter credit for neighborhood electric vehicles. Medium- and heavy-duty hybrids are also eligible for a half credit after a fleet has met its light-duty AFV acquisition requirements.
Well, well, well………. Tesla Motors officially exists in the auto industry. Automotive News, the “bible” of the auto industry, has asked Tesla CEO Elon Musk to be a featured speaker at Automotive News World Congress in January. Now, if anybody boos and hisses at him from the audience……..
Westport Innovations Inc. released its newest proprietary technology, the first generation of enhanced spark-ignited (ESI) natural gas system. The new natural gas combustion technology is designed to provide vehicle and engine original manufacturers (OEMs) with a “downsized” natural gas solution that is cost competitive while providing similar levels of power, torque, and fuel economy to a larger diesel engine.
Stevens Creek BMW in Santa Clara, Calif., is offering a good deal on a BMW i3 lease. It’s offering a $369 per month payment on a 36-month lease with $3,995 due at signing. Sales of the BMW i3 were about $350 a month for its first three months on the market before being increased. Sales have been very strong – 2,082 units sold from May to August, and a spike in numbers during August at 1,025. The Tesla Model S now has a direct competitor.
Hewlett-Packard, Lowe’s and Home Depot were among the 2014 winners of the US Environmental Protection Agency’s SmartWay awards. Freight transport companies are honored for improving fuel efficiency, reducing greenhouse gas emissions, and reducing air pollution. The award honors top truck, intermodal, and rail carrier partners that are setting efficiency benchmarks in how they move products and supplies.
University of Michigan Energy Institute professor John DeCicco thinks that self-driving cars can make transportation much greener and more sustainable. Connecting cars to the infrastructure around them can make traffic flow much more efficiently, along with other gains. I think I might agree with him.
Former GM vice chair Bob Lutz made another interesting statement: Tesla Motors will only be a “fringe brand” until it introduces the smaller and less expensive Model 3 in late 2017. Lutz also thinks Tesla stock is “grossly overvalued” for now.
Standard Oil tycoon John D. Rockefeller’s heirs are divesting from fossil fuels. The $860 million philanthropic organization, the Rockefeller Brothers Fund, will be divesting from stock in fossil fuels because of its harmful impact on climate change. The announcement was timed to coincide with the UN Climate Summit.

Big Picture: Archrivals Tesla and BMW cooperating on EV charging, What might Iraq conflict mean for gasoline prices?

Tesla Motors took more steps in sharing technologies, one of them taking place through meetings with its top competitor in the luxury electric vehicle space. Executives from Tesla and BMW met last week and discussed working together on charging stations that could fuel different types of electric cars. The automakers discussed ways to raise popularity of battery electric vehicles to overcome consumer stumbling blocks related to range anxiety, having access to enough charging stations, and how long it takes to charge them. “Both companies are strongly committed to the success of electro-mobility and discussed how to further strengthen the development of electro-mobility on an international level,” a BMW spokesman said in a statement. Tesla CEO Elon Musk said there had been talks with BMW about how to promote EV adoption, and how to make better use of Tesla’s network of charging stations. (Editor’s note: there’s also rumor that Nissan would like to join these conversations with Tesla and BMW.)

In that spirit, Musk posted a statement on the company’s blog last week that Tesla’s wall of patents has been removed: “in the spirit of the open source movement, for the advancement of electric vehicle technology. Tesla will not initiate patent lawsuits against anyone who, in good faith, wants to use our technology.” Musk has also recently made statements about EV charger companies taking up its “Supercharger” standard for fast charging; fast chargers will need to have higher power levels and shouldn’t charge people on a per-charge basis, he said. And in other news, Tesla had a favorable comment made by the automakers’ trade group, the Alliance of Automobile Manufacturers about the state-by-state legislative battles dealers are having with Tesla over franchise laws. The legal balance is weighted too heavily toward dealers and needs to be balanced out. “At the request of local dealer groups, states set up a labyrinth of protectionist laws that make the car-buying experience difficult and costly for our customers,” said Gloria Bergquist, a spokeswoman for the Alliance of Automobile Manufacturers, which represents 12 automakers but not Tesla.

And in other clean transportation news……….

What do energy experts think about the conflict in Iraq and how it may affect gasoline prices? What’s the latest on gasoline and diesel prices, and alternative fuel prices? Check out coverage in Automotive Digest. And for charts and market analysis, subscribe to Green Auto Market – Extended Edition, and you’ll receive that June issue by email.
Municipal Equipment Maintenance Association, Long Beach Clean Cities, and CleanTech OC are hosting a symposium with the title “Clean Transportation: Stepping on The Gas.” It will look at how industry players are moving that dial further forward and the effects of that in Orange County. It’s taking place next Thursday, June 19 from 12:30 to 6:30 at Brandman University in Irvine. Here’s a link for registering. Hope to see you there.
First responder training was held at the City of Los Angeles’ General Services Yard by Rio Hondo College Professor John Frala.The group was made up of technicians, body shop technicians, training managers, supervisors, and Los Angeles parking enforcement. Three technicians in attendance were Rio Hondo Automotive Graduates working for the City of Los Angeles. The program, funded through a US Department of Energy/Clean Cities grant, also focused on second responders providing towing and storage. California Fuel Cell Partnership’s Keith Malone attended and showed the new Hyundai Tucson Fuel Cell.
Check out “New Technology Reinvents Our Wheels” – in the latest Discover Magazine, written by Green Auto Market editor Jon LeSage. As the article’s intro says, “The future of driving is all about connectivity, sleek designs, and zero emissions.”
Minnesota is the first state nationwide to require its investor-owned utilities to offer a special rate for off-peak (overnight) EV refueling. Beginning in 2015, 1.3 million households will have access to a discounted rate for electric vehicle (EV) refueling. These utilities will also provide customers the option of zero-emissions EV refueling with renewable energy.
Georgia is now offering buyers of new electric cars a tax credit of up to $5,000, which is on top of the $7,500 income-tax credit offered by the Federal government. Atlanta residents get other incentives as well, including driver-only carpool-lane access and several charging stations. Georgia Power Co. also offers electric-car owners a low off-peak rate of about 6 cents per kilowatt-hour.
For those Californians looking for incentives, Honda just announced that those purchasing a new Civic Natural Gas vehicle are eligible for a $1,000 purchase credit provided by the California Energy Commission. Drivers will also get a “diamond lane” sticker – qualifying for single-occupant access to carpool lanes.
Ford Motor Co. and H.J. Heinz are working together to find more sustainable composite materials for use in vehicle manufacturing – with tomato fibers now being added to Ford’s list. Dried tomato skins could become the wiring brackets in a Ford vehicle or the storage bin a Ford customer uses to hold coins and other small objects, according to Ford and H.J. Heinz.
Six hydrogen production R&D projects selected yesterday by the US Department of Energy aim to produce, deliver, and dispense hydrogen at less than $4 per gallon gasoline equivalent; $20 million in grants were awarded.
National Biodiesel Board CEO Joe Jobe talked about the politics of the latest renewable fuel standard delays.
Why fleets can save $16,0000 in lifecycle cost using an electric vehcle.