AutoGuide News Blog
The AutoGuide News Blog is your source for breaking stories from the auto industry. Delivering news immediately, the AutoGuide Blog is constantly updated with the latest information, photos and video from manufacturers, auto shows, the aftermarket and professional racing.
According to the latest news, the Federal Government will pull its funding to ease the cost of buying an electric vehicle charger. Up until now, the Fed’s have been discounting these units as an incentive to get the public to buy an electric vehicle. In 2010, the deductions covered 50% of the cost, and in 2011 it was reduced to 30%. Now it seems that from 2012, no deduction will be offered to those buying these charging units.
If you use electric vehicles for commercial use, the savings were good for up to $30,000; but that will no longer be the case either.
Genevieve Cullen, the vice-president of the Electric Drive Transportation Association said that: “The timing of this couldn’t be more unfortunate”. Cullen and her supporters have been urging congress to extend the tax deduction, but it doesn’t appear to be working at this moment. However, if you buy an electric car now, you will still get the $7,500 tax credit offered by the government. So if you are thinking of buying an electric car, buy it before the government pulls its support from that program.
In 2011, the electric car and plug-in hybrids accounted for less than 2% of new car sales in the States.
Last year, some American car companies looked to their government for financial help to keep them afloat and use the money to develop new products. Some of them have actually used the money properly and produced some decent new models.
Over in the U.K., Lotus is looking at the British government to help out in the same capacity. Lotus is saying, that unless the government backs them up, they will have to resort to looking at producing vehicles outside of the United Kingdom.
This will not only affect jobs in its homeland, but would also mean that future products, like the highly anticipated new Esprit (above) will be built in either Austria (Magna) or Finland (Valmet).
Lotus is asking for a chunk (although no official amount is known) from the Regional Growth Fund, a program designed to help local industry and businesses. The decision will be announced by the early part of April. We’ll keep you posted on this developing story.
Last year, the Obama Administration heavily backed Detroit’s automakers with a big helping of government funding. The bail-out money that was partly provided to General Motors and Chrysler, was for these companies to develop and sell hybrids, plug-in hybrids and pure electric vehicles. The end result was the hardly amazing Chevrolet Volt.
However, the Obama administration still wants to help the electric and hybrid car industry, and their latest move to help move such products is to cut funding for clean-diesel and fuel-cell technology.
So while $80-million was budgeted for clean-diesel development in 2010, for 2011 that budget is cut down to zero. Congress had originally promised $500-million over 5-years for this project. Similar cuts have been made towards the development of hydrogen fuel-cell vehicles.
The money that is being cut from clean-diesel and fuel-cell vehicles will now go to plug-in hybrid vehicles. Under the new plan, the $7500 tax break will be given to the customer at the dealership, not when taxes are claimed at the end of the year.
So while this might be great news for anyone who is looking to buy a plug-in hybrid vehicle, this will have an effect on manufacturers who had invested in other technologies. Essentially, those who manufacture clean-diesel or hydrogen fuel-cell vehicles will see marketing their vehicles in North America pointless.
It’s well known that Chrysler and General Motors asked for Government loans to help them restructure during the most recent recession. It’s also well documented that Ford Motor Company asked for access to an emergency line of credit.
But what is less well known is that other automakers, including BMW and Mitsubishi also tapped the U.S. Federal Reserve for billions of dollars during the debt crisis. In BMW’s case, the Munich based company secured $3.62 billion in a line of credit, during a single transaction.
This helped it weather the economic storm better than others, while at the same time allowing it to invest in manufacturing and R&D, some of the funds being used for an expansion of it’s Spartanburg, South Carolina assembly plant that builds the X3 and X5. Yet, despite posting it’s lowest operating profit in 10 years during 2009, the company was still able to generate $2 billion in the black.