The Electric Car Conundrum

The 2009 North American International Auto Show has kicked off in Detroit with a focus this year on the mainstream media's latest transport darling, the electric car. Why, if you believe what the media (and some members of congress) has to say you'd be under the impression that as soon as manufacturers produce electric cars that can make it to the corner and back without a recharge, consumers will start beating their swords into Duracell shares just to get a piece of the action. But are Americans really ready to volt . . . I mean, bolt down to the dealerships to scrap their powerful internal combustion engines for a green feeling?

I have complained in the past that the fall of the American auto industry was caused in no small part by the over-regulating yahoos in Washington. For years American manufacturers have had to scale down performance to meet Federally mandated Corporate Average Fuel Economy (CAFE) regulations. These regulations, intended to improve the country's energy consumption and carbon footprint, in essence required the Big Three to build some cars that were expensive to manufacture, but wouldn't sell. As GM's Bob Lutz put it (sorry, don't remember it verbatim), trying to develop a national energy policy by creating fuel economy regulations for the auto manufacturers is like trying to solve the national obesity problem by forcing the clothing industry to make smaller clothes. And he's right, it doesn't make much sense. And it doesn't work.

So here we are, with the mainstream media and congress pushing the electric car, and they will do so through regulations. Soon we will see CAFE standards that force an even greater number of electrics and/or hybrids into U.S. fleets. But who is going to buy them? What proponents of this strategy don't seem to understand is that as long as gas prices stay below $2.00 a gallon most Americans won't be trading in their cost-effective fossil fuel flamers. And, believe it or not, some folk actually like big, powerful engines for hauling, towing or just plain flying down the highway like Burt Reynolds in that movie where he did that funny laugh. Are those folk likely to turn in their horses for a battery-charged pony ride?

Sure, there may come a time when the electric motor can provide efficiency and economy, but we're not there yet. And if the regulations continue to escalate, expect the auto industry to end up like the solar and wind power folk -- unable to survive without subsidy.