Taxing rumor mill…

CongressSeveral sites are quoting an unnamed Republican and announcing that the Federal Income Tax Credit for plug-in vehicles will be retained in the “reconciliation” bill.

For those unfamiliar with how our legislative process works, here’s a quick intro:

  • Lobbyist proposes a change to current law or a new law
  • Trench-coat-garbed smoking men meet in darkened public parking garage to exchange money and verbatim text of proposed law.
  • Congressperson enters new law as a bill.

(just kidding…I hope…)

  • The Senate and House both propose bills, in this case a tax reform bill.
  • Both the House and Senate committees debate and pass (or fail to pass) the bill from committee.
  • The bill is heard by the respective chamber and the entire chamber votes on the bill.
  • If the bills pass both the House and the Senate, someone has to iron out any differences, so that a singular, unified bill goes to the President’s desk for signature. This is done by a “reconciliation committee,” that makes compromises needed to assure passage through both chambers.
  • Both chambers vote on the reconciled bill.
  • If the reconciled bill passes both chambers, the bill is sent to the President for signature, making the bill the law of the land, or veto.

The big news for the last several weeks, in the EV world, is the House of Representatives had a clause, in their version of the tax reform bill, that eliminated the income tax credit, effective this December 31st. The Senate version kept the tax credit in place.

The first rumor I saw was that the reconciled bill contained the House’s wording, eliminating the tax credit.

Now, the latest rumor is exactly the opposite. Many sites are proclaiming the tax credit is saved.

My advice is unchanged: If you were considering the purchase or lease of a plug-in vehicle and the income tax credit was a major factor in the decision, do the following:

  • Do NOT trust. Verify. If there is no public announcement before January 1st, consider pulling the trigger on your acquisition instead of taking the risk of not getting the tax credit.
  • KEEP up the calls, emails, letters, tweets, Facebook posts, petitions, etc to your elected official up. Do NOT release the pressure, until we know the tax credit has been preserved!
  • Of course, if it is announced the tax credit is ending, I recommend taking advantage of it before year’s end. I wish I could do the same, but my current Volt lease doesn’t end until March 2019.
  • Of course, if both houses prematurely end the tax credit, vote against every single incumbent, regardless of party, in the next couple elections. Only then, will they remember who their bosses are and that they are in a subservient role.

November 2017 Sales Numbers

Beginning with this month, my charts will no longer include the Hyundai Ioniq Electric, as its sales have remained very low and there are other, more promising plug-in vehicles to track. In the charts, the Ioniq Electric has been replaced by Tesla’s Model 3. Admittedly, the Model 3 hasn’t fared much better… yet. However, the reservations placed make it a more important vehicle to track. As Tesla Motors continues to try to emerge from “production hell,” the story of their success or failure will be important, in the history of EVs. Ford Motor Company has announced the end of the C-Max Energi. Consequently, I will look for a suitable replacement. I’m leaning toward the Honda Clarity plug-in vehicle. However, since the Clarity has three different drivetrains (HFC, BEV, PHEV) I’m not sure if I’ll go with it. The sales figures aren’t broken up by drivetrain and I don’t want to muddy the plug-in waters with HFC sales numbers.

What vehicle would you suggest?

November 2017 plug-in vehicle sales were mostly up, over the previous month, with one exception: The BMW i3. I expect all plug-in sales to surge, at the end of each year, due to the nearness of the end of the year (and access to the income tax credit). The chart, shown below, shows my Volt and Bolt EV sales by month, over the last four years (December 2017 reflects three I have already sold this month but, of course, there will be many more to go, making the December orange bar much taller. Even without full December 2017 data, you can easily see the trend. There is an anomaly with March and April 2016 (yellow bars). That spike in sales was due to the introduction of the 2017 Volt. The 2016 Volt was not sold in Texas. The July/August 2017 spikes (orange bars) were fueled by the arrival of the Bolt EV in Texas and the factory orders, that had been placed by customers, in advance of those months. However, an obvious bias in plug-in sales, toward the end of the year, can clearly be seen. In November of 2016, I sold two Volts. Last month, I sold 10 plug-in vehicles (1 Volt, 9 Bolt EVs). In December of 2016, I sold 8 Volts. In the first two days of this month, I have already sold three plug-ins (1 Volt, 2 Bolt EVs). The only thing that can keep this month from blowing away all my previous plug-in sales results would be the very real possibility of running out of inventory! As it is, December in car sales is akin to trying to drink from a fire hose. This December, I’m going to have to get better at setting up appointments to maximize my availability to my customers.Plug-in Sales by WeekThis year, there will be additional buying urgency, caused by what happened two nights ago. The Senate passed their version of the Republican tax reform bill. As I posted earlier, the House version of this bill includes the termination of the Federal Income Tax Credit for plug-in vehicles, effective December 31st. The Senate version, the last time I checked, kept the tax credit in effect. Now, the two versions will be reconciled, behind closed doors, in conference committee. There is still a little time to a) get a plug-in vehicle, before the tax credit possibly goes away and b) contact your elected representatives to voice your opinion on this issue, or 3) sign a petition.EV Sales Numbers

Once again, I am going to point out the beginning of the adoption curves. The curve taking off the fastest is the Chevy Bolt EV. Its first twelve months of sales have have grown more rapidly than even the original Toyota Prius. If that curve can continue, transportation will fundamentally change much faster than I’ve been anticipating. The dark almost horizontal line, stretching from the first month to the fifth, is the Tesla Model 3. For an EV with 400K reservations and the majority of press coverage for two years, these two curves really show how Tesla is struggling with the Model 3 launch and the mass production strength of General Motors.Adoption curves

Here are the November 2017 sales figures, compared to the previous month:

  • Chevy Volt: UP 25% (1,702 vs.1,362)
  • Chevy Bolt EV: UP 7% (2,987 vs. 2,781)
  • Nissan Leaf: DOWN 18% (175 vs. 213) **new model announced
  • Plug-in Toyota Prius: UP 13% (1,834 vs. 1,626)
  • Tesla Model S: UP 19% (1,335 vs. 1,120) **estimated
  • Tesla Model X: UP 121% (1,875 vs. 850) **estimated
  • BMW i3: DOWN 59% (283 vs. 686)
  • Ford Fusion Energi: DOWN 1% (731 vs. 741)
  • Ford C-Max Energy: DOWN 8% (523 vs. 569) **end of model announced
  • Tesla Model 3: UP 138% (345 vs. 145)

In November, the average price of gasoline was $2.54 per gallon and started out around $2.53 per gallon, rising steadily until 8th. It peaked on the 18th at $2.57. After the 18th, prices steadily declined through the end of the month, bottoming out under $2.49.

My November sales have been pretty lackluster over the years I’be been selling cars. That is, until this year! This November my sales were over 3X my best November (2014) and 4X my average November. This is due to spiking Bolt EV sales. Without the ten Volt & Bolt EV sales last month, it would still have been my best November, but only by one unit sold.My Sales By WeekMy sixteen November sales were comprised of nine Bolt EVs, two Sparks (equalling my best total year of Spark sales!), one Silverado, one Colorado, one Tahoe, one Cruze and one Volt. Bolt EV is still the hot vehicle. Volt lost a little ground to pickups, and my total Bolt EV sales, over 5 months, is already 42% of my lifetime Volt sales. By vehicle type, my sales are 25% plug-ins, 21% SUVs, 19% pickups, 16% sports cars. The rest are sedans & vans (19%).Vehicle Sales By Model

Plug-in sales, compared to the same month a year ago, were mostly down, with two models showing an increase.

  • Chevy Volt: DOWN 33% (1,702 vs. 2,531) **the Bolt EV effect!
  • Chevy Bolt EV: (was not available in November 2016**new model announced
  • Nissan Leaf: DOWN 88% (175 vs. 1,457) **new model announced
  • Plug-in Toyota Prius: UP 135% (1,834 vs. 781)
  • Tesla Model S: DOWN 5% (1,335 vs. 1,400)
  • Tesla Model X: UP 108% (1,875 VS. 900)
  • BMW i3: DOWN 55% (283 vs. 629)
  • Ford Fusion Energi: DOWN 60% (731 vs. 1,817)
  • Ford C-Max Energi: DOWN 28% (523 vs. 721)
  • Tesla Model 3: (was not available in November 2016)

Giving America’s future to China

The big news in the EV business for the last month or so has been tax reform. The House of Representatives passed a new tax bill that eliminates the Federal Income Tax Credit on plug-in vehicles. Fortunately, the Senate is working on their version of the tax bill, which (at this time) retains the tax credit. If the Senate version passes, as is, it’ll be decided in conference committee, behind closed doors without us having a say in the matter. As displeased as I have been with the methodology of the tax credit (see this and this), I believe it is absolutely essential to keep it, so we do not trade away America’s leadership in EVs.

For a little background: My career began in manufacturing, specifically oil field manufacturing. I worked for wellhead and down-hole manufacturing companies from 1976 to 1985. In 1984, the price of oil collapsed, devastating the industry. My home town, Houston was brought to its knees. A huge number of people lost their jobs and their homes. When I got laid off, I had to move to the Dallas/Fort Worth area to find work and was fortunate to find it. I left the oil patch and worked as a manufacturing engineer for a printing press manufacturer and after three years, transitioned into the software industry. I was the technical member of a sales team that offered computer-aided design and manufacturing (CAD/CAM) solutions, across many different industries. I eventually left that field to go back into manufacturing engineering in the aerospace and defense sector.

During my entire career, in manufacturing, I read about the decline in manufacturing jobs in the U.S. The primary issue was, as global communication and transportation became more inexpensive, manufacturing shifted to emerging markets in Asia and South America and Mexico. Wages were much lower there, and factory automation reduced the skill level required to produce products. Only the products most difficult to manufacture, or seen as a strategic priority (military) continued to thrive in our country.

Americans seem to have difficulty with long-term memory. In World War II, American automobile manufacturers produced aircraft and tanks. The domestic strength in manufacturing was one of the reasons we prevailed. Today, those same companies are global, with parts (and entire vehicles) produced overseas. Our continued desire for big SUVs, trucks and cars illustrates that we’ve forgotten when OPEC crippled our economy (twice). Today, OPEC is weaker and is not perceived as a threat. Saudi Arabia recently announced a shift away from an oil-dominated economy and will focus more on global finance (thanks to the tons of money earned by selling their oil to the world). The Saudis have read the writing on the wall and are responding appropriately. That’s one of the strengths of a state guided by a monarchy.

If only our government had the same foresight.

Unfortunately, our democracy, due to what appeared to be minor tweaks in our tax laws, over decades, has become an oligarchy. Money, rather than individual votes, rules the day. The loss of manufacturing jobs meant a loss of union influence because there were fewer and fewer middle-class people employed in manufacturing. In my early career, I got a new job offer monthly and my employers knew this. My wages increased regularly. I felt secure in my job and could save and invest in my family’s future. Today, wages are stagnant. As a result, I moved to a career in sales. This allows me to have some control over my earnings and my future, but nowhere near the security I felt back in the 70’s and early 80’s. The recession, after 9/11, ended my career in software. The reckless gambling, by mortgage bankers, that caused the global recession in 2008 (which lingers to this day) destroyed my retirement savings. However, the bankers and investment houses have worked to minimize the effect of legislation to curb their behavior and are working to undo the last of the changes enacted to prevent future irresponsibility.

America leads today in two industries, which arguably started here: electric vehicles and the internet.

The internet gave the ability to publish to even the smallest organization or even individuals. My blog is an example. My words and opinions have been shared with literally thousands of people, around the world and allowed me to share thoughts about things important to me.

Much more importantly, it has enabled those being oppressed by tyrants to share their plight with the world. We’ve seen people rise up, with a united voice, in lands where small groups would have been snuffed out quickly. We’ve seen light shine, just this week, on slave auctions, things we thought were from the distant past. Now, the monied interests are plotting to end Net Neutrality so that only those with wealth can have a voice and only those willing to pay extra can search for the truth about the world in which we live. The Internet started as a DARPA-funded project, paid for by the tax payers. Now, the politicians are going to see to it we have no voice.

Electric cars started, over a century ago, in the U.S. Gasoline, with a better capacity to store energy (back then) came to dominate transportation and our nation grew and thrived, due to it. However, times, and technologies, change. A new way is being pioneered by Tesla Motors, General Motors, Ford Motor Company and yes, Nissan. I’ve written before about the countries that have stated their intention to end gasoline-powered cars, within their borders. We can lead the way and have those countries buy our vehicles or we can ceded our lead and watch other countries continue to develop ideas that came to fruition here. China represents more than 1/3 of the global market for vehicles. They will move to cleaner forms of transportation. If they have to, they’ll develop their own vehicles and we’ll be buying Chinese cars a decade from now. They’ll use the old smoke screen of “letting the free market decide the winners,” while ignoring the fact that our tax dollars subsidize the fossil fuel industry to the tune of billions of dollars a year.

Want a level playing field so the market can decide? Fine. End all subsidies for renewable energy and fossil fuels. Let the chips fall where they may. If the gutless politicians don’t have the testicular fortitude to pull our tax money from their masters, they sure as hell shouldn’t cripple our nation, as they line their pockets.

As we say in Texas, we all have a dog in this fight. Let your elected officials know exactly where you stand on these critical issues.

October 2017 Sales Numbers and a 38 Year Journey Ends

October 2017 plug-in vehicle sales were mostly down, over the previous month, with two exceptions: The Chevy Bolt EV and the BMW i3.

The total sales for the year, of the vehicles I track, have several bunched around one another. The Volt, Prius Prime*, Model X and Bolt EV are all within a variation of only 6%. If the Bolt EV is removed from that group, the variation drops to only 4%. These vehicles (not including Bolt EV) sell at an average rate of 1,614 units to 1,674 units, per month. The Bolt EV, although not available in all states until July of this year, averaged 1,708 units per month. The big showdown, between the Tesla Model 3 and Bolt EV, has failed to materialize, due to Tesla’s production challenges. In its first four months of availability, only 367 Model 3s have been sold. In the same four months, Chevy cranked out 9,491 Bolt EV sales. I have had three Bolt EV customers tell me they had considered a Tesla (including a Model X) before selecting the Bolt EV, due to its bang for the buck. If the rumored end of the Federal Income Tax Credit for plug-in vehicles comes to fruition, Tesla may see a stampede away from the Model 3, in order for buyers to get an electric vehicle before the $7,500 tax credit ends.

*(includes the previous model, the Plug-in Prius)
EV Sales Numbers

 

Here are the October 2017 sales figures, compared to the previous month:

  • Chevy Volt: Down 6% (1,362 vs. 1,453)
  • Chevy Bolt EV: UP 6% (2,781 vs. 2,632)
  • Nissan Leaf: DOWN 80% (213 vs. 1,055) **new model announced
  • Plug-in Toyota Prius: DOWN 14% (1,626 vs. 1,899)
  • Tesla Model S: DOWN 77% (1,120 VS. 4,860) **estimated
  • Tesla Model X: DOWN 73% (850 VS. 3,120) **estimated
  • BMW i3: UP 28% (686 VS. 538)
  • Ford Fusion Energi: DOWN 3% (741 VS. 763)
  • Ford C-Max Energy: DOWN 17% (569 VS. 683)
  • Hyundai Ioniq Electric: DOWN 22% (28 VS. 36) what’s going on here???

In October, the average price of gasoline was $2.47 per gallon and started out around $2.54 per gallon, dropping precipitously until bottoming out on the 22nd. After the 22nd, prices staggered higher, ending around $2.48.

With the exception of 2016, October has been a pretty good month for my sales. This October my sales were about the same as they were in October 2014 & 2015.My Sales By WeekMy ten October sales were comprised of four Bolt EVs, two Silverados, one Equinox, one Cruze, one Traverse, and one Volt. Bolt EV is still the hot vehicle. Volt lost a little ground to pickups, and the Bolt EV is gaining quickly on Volt. I am definitely seeing much more customer interest in the Bolt EV than I am in the Volt. In fact, Bolt EV is my #1 selling vehicle for 2017, even though we didn’t have any to sell, until the very last day of June! My top two vehicles in 2017 are Bolt EV (21 units) and Volt (17 units).

Vehicle Sales By Model

During lunch the other day, I got a call from a reporter from Wards Automotive and we discussed that dynamic. This October tied for my best October, so I should not complain, but I missed a GM target by only one vehicle. It is so frustrating for me when that happens! I had two appointments on Halloween that should have resulted in goal attainment, but one was a no-show and the other decided to keep the vehicle I sold them two years ago.

Plug-in sales, compared to the same month a year ago, were mixed, with two models suffering from new vehicles/models from the same manufacturer.

  • Chevy Volt: DOWN 38% (1,362 vs. 2,191) **the Bolt EV effect?
  • Chevy Bolt EV: (was not available in October 2016**new model announced
  • Nissan Leaf: DOWN 85% (213 vs. 1,412)
  • Plug-in Toyota Prius: DOES NOT COMPUTE! (1,626 vs. 0) **previous generation Prius plug-in, dying out last October
  • Tesla Model S: UP 21% (1,120 VS. 925)
  • Tesla Model X: UP 17% (850 VS. 725)
  • BMW i3: UP 55% (686 vs. 442)
  • Ford Fusion Energi: DOWN 46% (741 vs. 1,372)
  • Ford C-Max Energi: UNCHANGED (569 vs. 571)
  • Hyundai Ioniq Electric: (was not available in October 2016)

This week (November 1st through 7th) is a statistically odd week for my sales. In four years of selling cars, I have never sold a vehicle, during that week. Next month, I’ll let you know if I bucked that trend…

Finally, a story 38 years in the making: The Houston Astros finally won the World Series and are the champions. Baseball is the only sport I watch regularly and I grew up in Houston. I was in college, in 1979, when my father-in-law, Dwight Maney, Sr. started taking his sons and me to baseball games, in the Astrodome. That year, they came within 1-1/2 games of winning the NL West. I suffered through the extra-inning Game 5 defeat to the Phillies, in the NLCS, the following season, but was hooked for life.

I was in the Astrodome, when Nolan Ryan got his 4,000th strikeout and was in Rangers Stadium, when he got his 5,000th. I moved away from Houston, in 1986, when oil prices and real estate values collapsed, sending my hometown (and my career) into a downward spiral for a few years. I watched the 1986 NLCS on TV, in Arlington, Texas and was on my knees, screaming, when Kevin Bass struck out, in the 16th inning of Game 6, losing to the Mets.

Due to proximity, I became a Texas Rangers fan and slowly started loving the Rangers, but always had a soft spot for the Astros. In 1987, Nolan Ryan became a Ranger and it just seemed appropos. The only time I would root against the ‘Stros, were when they faced the Rangers. It was an adjustment, watching baseball outdoors. Having watched every game, previous to my move to Arlington, in the Astrodome, made me think of baseball as an indoor sport.

AstrosIn 2005, I took my youngest daughter, Zoe (6 years old at the time) to her first NLCS in Houston’s new stadium and they won. We were screaming after the game and with Zoe perched on my shoulders, a Houston TV station, which was shooting footage of the celebrating fans, captured the moment. The two of us drove the 4-1/2 hours back to DFW that night and heard the next morning that the footage of us celebrating had made the morning news. Zoe has been to many Rangers games since.

Zoe & Me 2005 NLCS

Zoe & me at 2005 NLCS. (that’s the jersey I wore this week, watching the World Series on TV)

Having won the NLCS, the Astros were on their way to the World Series, facing the Chicago White Sox. My youngest brother, Curt had gotten tickets for us, two for him and his wife to Game 4, and two for Bonnie and me to Game 5.

The Astros were swept in four straight games. My ticket was never used and I have it to this day.

Perhaps now, you can understand why I am writing about this on My Electric Vehicle Journey… GO ASTROS!!!!

Champs at last

I waited a long, long time to see this.

Dark clouds on the horizon.

IRS logoAccording to an article posted by Green Car Reports today, the Federal Income Tax Credit for plug-in vehicles may be in danger of being eliminated prematurely. Based on the picks that have been made to head up departments like the EPA, Department of Energy, etc, this could be a very real threat.

There are two courses of action:

  • If you’ve been considering a plug-in vehicle, you may want to purchase or lease one before the end 2017.
  • If you’re opposed to this action, contact your elected representative and make your voice heard!

The writing’s on the wall?

wall writing

Just a quick scan of news sites helped me put together a list of countries who have announced an end date for gasoline- or diesel-powered car sales:

  • China (no date set)
  • India 13 years from now
  • France 23 years
  • Britain 23 years
  • Norway 8 years
  • Scotland 15 years
  • Netherlands 8 years

These countries have set EV sales targets, but no end date has been set for gasoline- and diesel-powered passenger vehicle sales to end…yet.

  • Germany
  • Austria
  • Denmark (I could have sworn they set a date)
  • Ireland
  • Japan
  • Portugal
  • Korea
  • Spain
Trendsetters

Trendsetters (click for larger image)

Geographically speaking, the map above may not seem impressive, but in 2016, the countries mentioned above, represented 62.9% of all passenger vehicle sales for the entire planet!* (I was a bit surprised by that)

Here’s how they stack up:

  • China 35.1%
  • Japan 6%
  • Germany 4.8%
  • India 4.3%
  • Britain 3.9%
  • France 2.9%
  • Korea 2.2%
  • Spain 1.7%
  • Netherlands 0.6%
  • Austria 0.5%
  • Denmark 0.3%
  • Portugal 0.3%
  • Norway 0.2%
  • Ireland 0.2%
  • Scotland (included in Britain’s percentage)

China’s the big dog (both geographically and in percentage of cars sold), at 35.1%. The next in line, at least as far as the countries listed above go, is Japan, at 6%. May be that’s why Mary Barra’s comment about China’s decision seems to have been toned down, recently… Heck, the U.S. is only 9.9%. As such, the U.S. is the largest country, in passenger vehicle sales volume, that hasn’t posted an end date for ICE vehicles or plans to do so.

This brings a few questions to mind:

  • If the stated goals are upheld, what happens to the price of gasoline?
  • If gas prices collapse, wouldn’t that dramatically reduce the number of gas stations. accelerating the switch, globally?
  • Will pre-owned gasoline- & diesel-powered cars become valuable collectibles or, due to the lack of gas stations, junkyard fodder?
  • Will we finally see people change careers from fossil fuel industries (dangerous to both workers and the environment) to renewable energy careers, accelerating change?
  • Has the United States’ time, as a world leader, ended for good, now that China’s and India’s middle classes are rising in purchasing power, while ours is being decimated by income inequality? Are we cool with that?
  • Has Fiat decided to just roll over and die?

*according to sales statistics from The International Organization of Motor Vehicle Manufacturers.