Consumer Reports’ Top 10 for 2014

Consumer Reports has released its 2014 Customer Satisfaction Survey results for 2014. Out of all vehicles one to three years old, only two plug-in vehicles made the top 10 this year and they were…(drum roll)… the Tesla Model S (#1) and the Chevrolet Volt! (#10)

They have some pretty nice company in this year’s list, including the gas-powered vehicle we use for comparing electric vehicle sales to traditional vehicle sales, the Chevrolet Corvette (#2):Top 10 - 2014

November 2014 sales numbers

Still awaiting Ford’s numbers, but I couldn’t wait any more:

Plug-in vehicle sales, compared to the previous month, looked like this:

  • Chevy Volt: down 7% (1,336 vs.1,439)
  • Nissan Leaf: slightly up by 4% (2,687 vs. 2,589) **outsold Volt by more than 2-to-1
  • Plug-in Toyota Prius: down 6% (451 vs. 479)
  • Cadillac ELR: slightly up by 2% (155 vs. 152)
  • BMW i3: DOWN 30% (816 vs. 1,159)
  • BMW i8: DOWN 38% (126 vs. 204)
  • Ford Fusion Energi: **awaiting Ford’s numbers
  • Ford C-Max Energi: **awaiting Ford’s numbers
  • Chevy Corvette Stingray: DOWN 20% (2,378 vs. 2,959)

November sales were slow out of the gate, but as Black Friday approached, they picked up steadily. Black Friday and the following Saturday were very busy, with lots of people off work for the holiday. Here in Texas, the weather was spectacular, so everyone was out after a short-lived freeze the week before.November 2014 Sales Numbers

 

I mentioned last month that the Leaf’s total US sales, could surpass the Volt’s by March or April of next year. You can really see that in the graph. In fact, in two of the last three months, the Leave has outsold the Volt by a factor of two-to-one. If this keeps up, my prediction could prove to be overly conservative. The Leaf has had a great advertising campaign, touting its owners’ fuel savings. Coupled with great leasing incentives, the Leaf is taking off. Are you hearing this GM??? I have to believe that GM is waiting for the 2016 Volt unveil in January to kick off an advertising campaign. I have no evidence of this, other than GM’s activity on social media, teasing with partial views of the new Volt design. We shall see…

I believe the ELR’s sales are being hurt by the Volt teasers. The ELR is based on the current Volt drivetrain. Anyone thinking about spending as much as it costs to get an ELR is probably doing their due diligence and thinking about it being based on what is about to become the “old design,” versus getting a 2016 Volt (or hoping for an updated ELR). The 2016 ELR (model year 2015 is being skipped, according to a GM source of Edmunds) was supposed to debut at the LA Auto Show last month, but this did not happen. Rumors of why have been floating about the web, but it seems the most plausible reason is that new features are not ready for prime time.

Sales, compared to the same month a year ago, looked like this:

  • Chevy Volt: DOWN 30% (1,336 vs. 1,920) .
  • Nissan Leaf: UP 34% (2,687 vs. 2,003)
  • Plug-in Toyota Prius: DOWN 59% (451 vs. 1,100)
  • Cadillac ELR: (did not exist a year ago)
  • BMW i3: (did not exist a year ago)
  • BMW i8: (did not exist a year ago)
  • Ford Fusion Energi: **awaiting Ford’s numbers
  • Ford C-Max Energi: **awaiting Ford’s numbers
  • Chevy Corvette Stingray: down 6% (2,378 vs. 2,527)

Gas prices continue to decline with the drop of about 25 cents per gallon for each of the last two months in a row. I’ve heard a couple conspiracy theories on this: a) OPEC wants to kill the competition from the U.S. aided by fracking. As prices drop, fracking becomes less economically feasible, and b) The popularity of EVs in the media, especially the Tesla Model S and BMW i8, are causing OPEC to start to worry about the value of their assets.

What’s your pet theory for the decline in gasoline prices?

Poll dancing

Poll ResultsIt all started with a poll on Facebook posted by ElectricCarCommunity.com. The question: “Should Government provide more subsidies or tax breaks to encourage purchase of electric vehicles?

This will probably shock anyone that knows me, but I believe the current subsidies/tax breaks are sufficient (at least in Texas). Case in point: The Chevy Volt in Texas: The base level Volt has a list price of $34,995. Incentives available from GM reduce it to $32,800 for credit union members. Then the government joins in with a $7,500 federal income tax credit which reduces the price to $25,300. Finally, in my neck of the woods, the $2,500 Texas rebate makes it $22,800.

$22,800. Think about that for a moment. That’s in the same price range as a mid-level Chevy Cruze! The Volt is a FAR superior vehicle and the fuel and maintenance savings make the deal even more compelling.

One way government could do a better job of encouraging EV adoption, would be somehow getting the incentives into the original car deal. In the above example, the buyer  would have to qualify for a $32,800 loan (less down payment and plus tax, title and license), even though the Volt ends up costing them only $22,800, once they receive the incentives. This eliminates a HUGE number of potential buyers who cannot afford or qualify for such a large amount. Worse, those are the very people who NEED the savings an EV provides! But wait, it gets even worse. Those with lower incomes also have lower taxes. Because the maximum amount of the benefit is a buyer’s total income tax burden, those who pay less than $7,500 in income tax (either through lower income or tax deductions like mortgage interest and real estate taxes reducing their tax burden) only get the amount of their tax. Any remainder is lopped off, with no rollover to the next tax year.

Another unexpected problem with the income tax credit is that it biases sales to the last few months of the year, when buyers know they’ll be able to take advantage of the income tax credit soon, when they file their income tax returns early in the next year. Conversely, this means the tax credit discourages purchases earlier in the year, because the purchaser will end up waiting up to an entire year before receiving the benefit of the tax credit.

There is also a perception problem with the incentives from the government. Those upset by the GM takeover by the government see the incentives as handouts. Many EV owners have heard the comment, “Are you enjoying your car that my taxes helped pay for?” Oddly enough, many of those same people don’t consider the tax incentives associated with home ownership to be the same… Increasing the incentives would only add fuel to that fire and probably result in a call to end all incentives for EVs. In my opinion, this would be a grave error for the U.S., as we are one of the leading countries in the field at this time. Abdicating this position would be the equivalent of deciding not to build an oil exploration capability in the previous century, leaving it all up to OPEC. Battery technology development is a strategic strength for us and must be exploited.

If the government were to invest further funds in pushing EV adoption, I have a few recommendations on places to put our hard-earned tax dollars:

  • Most important: Aggressively advertise the existence of current incentives as well as the reasons for them.
  • Develop parking regulations that prohibit gasoline-powered vehicles from parking in spaces allocated for charging, and aggressively enforce them.
  • Follow the example of California and allow EVs to have access to high occupancy vehicle (HOV) or express lanes. (This seemed to have a phenomenal impact on EV adoption in the Golden State.) In Texas, where tollways have become popular (with the government anyway), grant EVs the same discount given to vehicles with multiple occupants. This would be simple to implement, as our toll tag accounts have information on our vehicle type.
  • Have special license plates for EVs and hybrids to make them stand out more. Nothing sells an EV quite like the question, “How do you like your EV?” Those of us who own them are more than happy to share their benefits with others.
  • Prepare the public for a change in the method of calculating and collecting taxes that are currently included in the price of gasoline at the pump. As I’ve mentioned before, we need our tax system to disconnect from any fuel/energy type. With hydrogen fuel cell vehicles coming out now, a system taxing electricity, hydrogen, gasoline, diesel, etc will become too cumbersome.
  • Finally, prepare the public, well in advance, for an end to oil subsidies and the effect that will have on prices. If we seriously want to reduce carbon emissions, we have to consider this step. However, as this has not been publicly discussed in detail, the American public has been happy to continue buying large, inefficient vehicles. They should not be penalized by making their purchases worthless overnight, so this is an important step to start discussing now with the intention to be implementation of the change, after the average ownership span of a vehicle. Perhaps seven to ten years from now, we could remove the oil subsidies.

As you can see from the graph above, I’m in a very small minority, when it comes to the question posed by the poll. We’ve thrown money at the adoption rate. Perhaps it’s time we tried some more ideas.

What are your ideas to increase EV adoption?

Juxt app wins Transportation category in NTx App Challenge

EVNT logoI regularly attend the Electric Vehicles North Texas (EVNT) meetings put on by the North Central Texas Council of Governments (NCTCOG). From the EVNT site:

Electric Vehicles North Texas (EVNT) was developed to coordinate a partnership with utility companies, regional governments, school districts, transit authorities, and local businesses in an effort to promote adoption of and ensure adequate resources for electric vehicles.

These meetings are very informative and allow me to keep up with electric vehicle adoption in North Texas, as well as proposed plans for the future that affect EV owners. It also allows my voice, as an EV owner, blogger and EV sales professional, to be heard (boy, I bet they’re getting tired of my voice…). We all joke about the inefficiency and lack of dedication of government bureaucrats, but the NCTCOG people I have met are driven (no pun intended) to improve air quality and push EV adoption in Texas. I thoroughly enjoy the meetings and have met other EV-oriented individuals there, with whom I network.

At the August 13th meeting, I watched a presentation put on by Robert Kent, the Director of Public Policy for the North Texas Commission, a regional non-profit corporation in the Dallas-Fort Worth region. The presentation was about the NTx Apps Challenge. This challenge was a competition designed to promote app development in four sustainability areas: water conservation, waste and recycling, smart energy and transportation. The winning teams in each category would win $10,000 of up-front cash for their development efforts as well as an additional $10,000 for continued development on their app.

After the meeting, Robert asked if I’d like to share ideas with the teams working on transportation apps. I was invited to a brainstorming session, in which we all kicked around ideas for the teams to develop. One of the teams was interested in creating an app to help EV drivers find charging stations. Of course, there were already a plethora of such apps already available, so I was a bit dubious about their idea. However, we all did some out-of-the-box thinking, about what sorts of functionality we’d like to see in an app of this sort. The winners of the competition were announced October 17th and one of the teams I met created the winning app in the transportation category! The app is named Juxt. Team Juxt, working on the strategy, research and development of the app, was comprised of three members: Gerard Matthew,  Priyanka Sharma and Harish Upadhyayula. They developed an app that “allows drivers of alternative fuel vehicles to find fueling stations, parking spaces, and other points of interest along their route, and share this information with other app users.”Get the Juxt app!

The Juxt app is a very slick-looking app that, in addition to finding charging stations and EV parking spots, strengthens the EV community, by allowing users to leave tips on each charging station, as well as photos. I met with Team Juxt again, after their win, to brainstorm ideas for additional functionality to add in the future. The team was very accepting of ideas and there are functions planned in the future that will be truly amazing. I’m not sure if Team Juxt wants me to talk about future capabilities, so you’ll just have to trust me on that one… Here are some screenshots, showing the flow of using Juxt. Click on the image to see all the screenshots or download the PDF.

Juxt workflow

Click on image to view all the screenshots or to download PDF.

The moral of this story is that each of us can move the EV revolution forward by looking for ways to participate. I haven’t written a line of code in years, although I was a programmer for decades. That doesn’t mean I can’t help/contribute! There are developers out there looking for ideas for apps. They need your expertise as an EV owner. Find a way to locate and network with these developers and we’ll all benefit!

**UPDATE** The Dallas Business Journal published an article about Team Juxt’s win.

P.S. I am not compensated, in any way, by Team Juxt, the Juxt app, and did not receive any of the funds handed out by the competition. I’m just a fan.

Are we trading OPEC for OHEC? (Oh, Heck!)

Announcements of hydrogen fuel cell vehicles from Toyota, Honda, BMW are starting to gain more traction in the media, especially since Toyota announced availability of the Mirai in December of this year. Of course, like electric vehicles, infrastructure must be put in place to refuel fuel cell vehicles (FCVs).

Well, it’s not exactly like electric vehicles.

Most EV owners refuel at home and do not depend on public charging stations, except when they’re on a drive long enough that their battery would be depleted before they get back home.

Therein lies one critical issue. Way back in 2003, long before the modern era of EVs, President Bush announced a program called the Hydrogen Fuel Initiative. I remember hearing about this miracle of vehicles, powered by the most common element in the universe, but which generates no pollution and whose exhaust pipes only produce water. I just KNEW I would own one of these…someday.

My excitement and anticipation have started to wane, due to several factors:

  • I have acquired three plug-in extended range electric vehicles and have found that they serve my needs perfectly. I look forward to a day when I can rely solely on ‘green’ fuel, but in the meantime, I have an on-board generator to keep my car moving down the road. I see this type of vehicle as a stepping stone into a future with EV range extended and charging time greatly reduced.
  • I have become used to refueling my vehicle in my garage and dread the thought of traveling away from my home to stand in the heat, or cold, or rain to refill my fuel tank. Unless some relatively inexpensive device is developed, that can accumulate or generate and store Hydrogen at my home, I feel less inclined to explore hydrogen fuel cell vehicles. The Department of Energy is offering a large cash prize for whoever comes up with this device first. Of course, whenever I think about storing highly compressed hydrogen near my home, the Hindenburg disaster comes to mind…
  • I look forward to a day when I will have solar panels on my roof, generating the ‘fuel’ for my vehicles. No longer will I be at the mercy of a corporation or consortium because I need their fuel. No longer will I have to keep an eye on constantly changing fuel prices or shopping for a fuel bargain. No longer will I have to wonder how ‘clean’ my fuel is (i.e. how my electric provider generates the electricity I use). Hydrogen may be the most common element in the universe, but it doesn’t rain down on me, in a usable form, like sunlight does. Even if I can generate hydrogen at home, I’ll need somewhere to store it in a compressed form (up to 10,000 PSI). I’m not very excited about that at all. In the meantime, I will have to buy my hydrogen from a company, so am I trading OPEC (Organization of Petroleum Exporting Countries) for OHEC (Organization of Hydrogen Energy Companies)? That’s pronounced “Oh, heck!” Remember you heard that here first…
  • Once again, the auto industry is producing some very ugly designs to differentiate these vehicles from all who came before them. I’ve complained about this before. The Prius was/is (in my opinion) an ugly car. But it is recognizable, which is what Toyota wanted in the Prius’ infancy. Now they’re everywhere, so come on, Toyota, come up with an attractive look already! The Leaf, the i3, the i-MiEV, the 500e, the Think City, and the LiFE are all using quirky (I’m being generous here) looks to stand out from the hundreds of millions of vehicles in the world today. I understand the importance of branding (order a MEVJ cap and t-shirt today!) but this design approach gives the general public the idea that EVs, all alternative fuel vehicles in fact, have to be funky looking. Automakers: Take note of the Volt, ELR, i8, Model S, and Tesla Roadster to see how it should be done!
  • Finally, having mentioned the Hindenburg disaster previously, I am concerned about what happens when a car accident causes the hydrogen tank to be ruptured. What is the effect of suddenly releasing a 10,000 PSI gas? How flammable will the vented hydrogen be? Won’t someone think of the children?!?! (tongue in cheek) The OSHA website lists dangers associated with working around hydrogen and hydrogen fuel cells here.

Now, before all you fuel cell fans and manufacturers dog pile on me, understand that I want the dream of a pollution-free vehicle to become reality. I am aware that producing batteries, using current methods, generates its own forms of pollution. I also know that the generation of hydrogen has ecological trade-offs and may depend on fossil fuels, like natural gas. I’m just saying, let’s keep our heads and evaluate the pros and cons of these new types of clean vehicles. Let’s keep looking for ways to increase battery range, decrease battery weight, decrease charging time and improve chemistry to have less of an environmental impact. Hydrogen fuel cell vehicles: Welcome to the fray!

May the best approach win.

It’s The Most Wonderful Time Of The Year

There are only 37 car shopping days left in 2014. Now is the best time of year to buy a plug-in vehicle. Why? Well, here’s several reasons:

  • Stocking Stuffed

    Now, where can I find a mantle large enough???

    Dealerships, like all sales organizations, measure performance by sales goals, the most important of which is total annual sales. Every dealership likes to claim they’re the highest volume dealership in the city or state or nation (or universe). The owners of the top dealerships are fawned over by the manufacturers and there are financial rewards as well (not to mention those bragging rights, used in advertising).

  • Each salesperson’s performance is evaluated by their annual sales, among other criteria, such as customer satisfaction surveys, sales of accessories, etc. As the year comes to an end, some may be on the verge of reaching a threshold where the manufacturer or dealership rewards their performance. An example of this is the “GM Mark of Excellence.” Salespeople who achieve the Mark of Excellence can order business cards, clothing, etc with the Mark of Excellence logo emblazoned upon them. Those salespeople that are close to the goal, at the end of the year, may care a bit less about their commission and more about total unit sales, giving you a little more leverage when negotiating.
  • In the case of plug-in vehicles though, there is another much more important factor: The federal income tax credit for alternative fuel vehicle purchases. The U.S. government gives a credit of up to $7,500 for the purchase of certain plug-in vehicles. Currently, (no pun intended) there are twenty-two vehicles covered by this program. There are caveats (as with all government programs) including:
    • The vehicle must be a new vehicle, never before titled/registered by anyone else.
    • The vehicle must be purchased, not leased.
    • You get back up to $7,500. You can only get back as much tax as you actually pay in, up to the $7,500 limit. For example, if you’re retired and your total federal income tax due is only $4,000, that’s all you get. There is no roll-over into next year’s income tax. This is confusing to some people I’ve spoken with. It’s not the size of the check you send in with your income tax return. It’s the total amount of income tax you paid in all year long plus any check you have to send in (or minus any refund you would normally get) with your return. Take a look at your most recent paycheck stub and locate the federal tax withheld so far this year. Surprised by the amount you’ve paid in? How’d you like to get up to $7,500 of that back? I’m going to, because I bought our 3rd Volt back in October!
    • It is a tax credit, not a tax deduction. This is a big deal. If you’ve claimed a tax deduction in the past, for instance the deduction for mortgage interest, you may have noticed you only get a portion of that deducted amount back. The amount of a deduction is subtracted from your income, NOT from your taxes. For instance, you may have paid $10,000 in mortgage interest. When you deduct that from your income, it only reduces your tax burden by a portion of the deducted amount. For instance, if you’re in the 25% income tax bracket, you’d only get 25% of the amount deducted. Deduct $10,000 and you’d get $2,500 off your taxes. THIS TAX CREDIT IS DIFFERENT! You could get all of the $7,500 back!
    • When you purchase a qualifying plug-in vehicle, you file an extra one page form when you file your income tax return the following year. This is hugely important. If you buy a qualifying vehicle between now and December 31st, you get that cash back when you file your income tax return a couple months later. However, if you buy on January 1st or later, you’ll have to wait up to a year before you can file for the credit. (yes, I know dealerships are probably closed on New Year’s Day…)
    • Finally, after the last election, there may be attempts to dismantle the program, as some more conservative politicians see it as an entitlement rather than a way to get these important vehicles adopted quickly. The program is supposed to start tapering off, for each model of vehicle, once sales reach 200,000 units in the U.S. As of the end of last month, only 70,531 Volts and 66,804 Leafs had been sold in the U.S., since their inception in December 2010. Those two are by far the most common plug-in vehicles in the country. Without interference by our elected officials, this program should last several more years, but you never know…

So if you’ve been on the fence about getting a plug-in vehicle, NOW is the time to pull the trigger. Start saving money on fuel and maintenance right away and early next year the IRS may seem a bit more like Santa Clause than Ebenezer Scrooge!