By George Perry
I have suggested that our proposed 10-year effort to win the 40-year war on oil will result in oil playing a very minor role in personal transportation — if by 2022 some 80 percent of all new cars are electric-only PEVs (plug-in vehicles). Previous essays suggest that our more comfortable citizens take a lead role in expediting transition to electric cars by committing to delivery without waiting for the technology to reach perfection. We also saw the electric utilities taking a major PR role in selling the concept and working to make sure that many a street corner sports an instant recharge station.
The federal government has a major but not necessarily expensive role to play in the war on oil. The feds must choose to endorse a specific strategy that goes beyond bankrolling every attractive experiment.
Other participants in the ongoing battle are as follows:
* State governments
The gold standard in auto legislation has been and remains California. With 10 percent (25 million) of the nation's cars, little wonder that Californians are the most concerned about the impact of autos on their environment and culture. They will undoubtedly lead the move to electrics, and considering their tolerance for new ideas, they are ideal pioneers. Let's hope other states take the lead from the innovative Californians.
* Auto dealerships
The auto retailers are probably ambivalent about electrics. Many claim their only profit comes from the maintenance and repair of conventional vehicles. But with electrics, every 20,000 miles or so all dealers will do is rotate the tires, fill up the windshield washer fluid and send them home. This may be a bit hyperbolic, but no question that maintenance is very modest compared to ICEs (internal combustion engines). Incidentally, in our cost/benefit analyses showing electric advantages, we have taken no credit for lower maintenance costs.
Here's an idea that might save the day. Someday, there will be a battery with, say, a 500-mile range. It will likely be gigantic. It could be loaded into whatever honking big SUV is your secret love, be it a Hummer or Escalade.
Even with a lesser range, you will be getting much better mileage and you will instantly be socially and environmentally acceptable, since you use only excess post-midnight electricity.
You will be happy with your behemoth.
* Oil and gas lobby
They'll probably be nonplussed, even though their natural gas business should do quite well. They might believe that if we are to mobilize for war, it must be the responsibility of Exxon-Mobil. We'll examine their viewpoint in future articles.
Many years ago, during WWII, my family had an "A" gasoline ration card. "A" was not the best category; it was the worst. As I recall, we never moved our '35 Chevy; we hoarded our meager ration so that we could go over the mountain to grandma's house in Vermont for Thanksgiving.
We were happy to do so. Every sacrifice was eagerly embraced.
I agree our current 40-year war against oil is not as horrifically intense as the 1940s' WWII conflict, but I submit the consequences could be almost as ominous.
But consider this scenario: I recently visited a major car dealer who displayed a luxury hybrid that suggested an impressive (for a large car) 42 MPG capability. The salesman informed me that the same car was available in standard mode (30 MPG) at the same price.
I was incredulous. Why would anyone buy conventional when hybrid costs no more?
The buyer of the standard model apparently could haggle a bit, and end up paying a little less. Still, someone who could afford a $40,000 car could surely ante up a couple grand more, especially when $4 gas suggests a payoff in a year or two. Don't they feel any obligation to contribute to the "war on oil'' effort, no matter how moderately?
If not, I guess the journey to energy independence will be tougher than I had hoped. Surely our civic responsibility goes beyond putting old newspapers in the recycle bin!
Perry is a retired vice president of American Express Financial Advisors (now Ameriprise). Articles on electric cars and a complete analysis of Social Security and Medicare can be found at www.entitlementdilemma.com. His email address is George@entitlementdilemma.com.