The SUV is Dead, R.I.P.

[Steve S]

Originally Posted By: Duffman77
Originally Posted By: Shannow
Personally, I think CAFE is a great idea (if it includes land yachts as well).


I don’t think it is possible for me to vehemently disagree more. CAFE is a response of lame duck politicians to p-foot around the issue. The issue is American consume too much oil. TAX THE FUEL to curb demand. CAFE puts the burden on manufacturers to get consumers to buy something they don’t want to buy. Change consumers minds instead and they will buy what is good and the manufacturers will get a clear signal in what they need to build. If gas was $4/gal 10 years ago, the automakers would not be up this creek without a paddle.
Governments get too much money as it is I do not think it is wise to give them any more.

 

[Bamaro]

Feebates are the answer. The more gas a vehicle guzzles (yup, cars, minivans, SUVs, crossovers, pickups, whatever) the higher the fee paid at purchase. The less gas sipped, the bigger the rebate. It could be structured as a zero gain/loss program. The fees would pay for the rebates.

 

[Gary Allan]

You would still have someone setting the standards of what qualifies for a feebate. Suppose the economical offerings started at Explorers and nothing more economical was produced? Unimog's would fund the difference if that was your chosen mode of transportation.

Cafe is fine. It just needs the domestic industry to make economical cars upscale. Now their just the standard fare of the rabble.

 

[Duffman77]

Shannow,
Two issues will come out of this.

1) The government will overflow with tax revenue allowing corporate and sales taxes to be cut to offset cost increases seen by the consumer due to trucking costs. Some items will be hurt more than others and this will further reduce demand for oil.

2)Doug raises the other but I do not agree with his assessment. As transportation costs rise, intelligent business will find ways to reduce costs and less transport will be done by the least efficient method (Air) and will trickle down to the most efficient method (Rail). It would become more imperative for trucks to operate at their GCWR so efficiency will be found again. Finally, the fuel cost/labour cost ratio changes making it cost effective for trucks to slow down and find more MPG. When fuel is cheap it is easier to be wasteful as we see with empty SUVs driving around.

 

[Duffman77]

Originally Posted By: Bamaro
Feebates are the answer. The more gas a vehicle guzzles (yup, cars, minivans, SUVs, crossovers, pickups, whatever) the higher the fee paid at purchase. The less gas sipped, the bigger the rebate. It could be structured as a zero gain/loss program. The fees would pay for the rebates.


I disagree again, this solution assumes that ownership is the problem, but ownership is not the problem, consumption is the problem. A prius owner that put on 50K miles a year is a bigger problem then the guy that owns the ferrari that see 50 miles of track time because it is a collectible or show car to its owner. The only solution that attacks the root of the problem is taxing the fuel itself.

 

[Duffman77]

Originally Posted By: Steve S
Originally Posted By: Duffman77
Originally Posted By: Shannow
Personally, I think CAFE is a great idea (if it includes land yachts as well).


I don’t think it is possible for me to vehemently disagree more. CAFE is a response of lame duck politicians to p-foot around the issue. The issue is American consume too much oil. TAX THE FUEL to curb demand. CAFE puts the burden on manufacturers to get consumers to buy something they don’t want to buy. Change consumers minds instead and they will buy what is good and the manufacturers will get a clear signal in what they need to build. If gas was $4/gal 10 years ago, the automakers would not be up this creek without a paddle.
Governments get too much money as it is I do not think it is wise to give them any more.


It's Joe six pack here that makes the politician a lame duck. You get the govt you deserve Steve.

 

[grampi]

Originally Posted By: tonycarguy
US gas prices have declined significantly in the past month. Most places are under $3 and the lowest places in the country are under $2. If this continues, sales of larger vehicles will increase again. People didn't switch to hybrids because they suddenly started caring about the environment or geo-political factors.


Only the short sighted will rush out to buy gas hogs because of dropping gas prices. Anyone with even a partial brain knows that gas prices won't stay low. Gas hogs are a dying breed as well they should be. The SUV doesn't necessarily need to go away, they just need to figure out how to make it energy efficient.

 

[XS650]

Originally Posted By: Duffman77


I disagree again, this solution assumes that ownership is the problem, but ownership is not the problem, consumption is the problem. A prius owner that put on 50K miles a year is a bigger problem then the guy that owns the ferrari that see 50 miles of track time because it is a collectible or show car to its owner. The only solution that attacks the root of the problem is taxing the fuel itself.


The other advantage a straight tax on gas has compared to other schemes is that a straight tax is simple and difficult to corrupt.

The problems start when the tax money goes to gummnt agencies and they start getting creative with it.

 

[exranger06]

Originally Posted By: Bamaro
Feebates are the answer. The more gas a vehicle guzzles (yup, cars, minivans, SUVs, crossovers, pickups, whatever) the higher the fee paid at purchase. The less gas sipped, the bigger the rebate. It could be structured as a zero gain/loss program. The fees would pay for the rebates.

There already is a Gas guzzler tax. It only applies to sports cars and the like that are gas guzzlers, not SUVs and trucks, but that could easily be changed.
Owners of hybrids also already receive tax rebates and other benefits too.

 

[Gary Allan]

Hollywood tasking. It's sorta like Hollywood accounting ..except instead of writing off revenue on vapor expenses, you find more ways to spend the limited available revenue ..to the point that you need more of it.


It's a shame our monetary/treasury system is set up upon borrowing. One would reason that you could have dedicated trusts for projects. For example, if you've got a 50 year lifespan on a bridge, then some dedicated fund should be there for bridge replacement. As the yield from the trust was outpaced by the cost of bridge replacement, you configure it so that the contribution goes to the trust to increase the yield ..not directly making up the shortfall. Naturally this would mean that you have to do without that same revenue elsewhere and would have to tie up massive amounts of revenue to accomplish relatively small tasks ..but ..so?? A bit too late for that "pay forward" mentality now.

 

[Kestas]

Let me mention how CAFE worked back in the late 70s - early 80s for those that probably don't remember.

When CAFE was enacted in response to the shortage of gasoline, the automakers were forced to raise prices on large vehicles and lower them on small vehicles. The running joke at the time was that a guy looking to buy a Ford Crown Victoria had to wait until five Pintos were sold so the Ford Motor Company can meet the government imposed CAFE standards. Mnay small vehicles were sold for less than it cost to manufacture them.

So as not to hurt the working man (e.g., farmer, plumber, electrician), the government exempted light trucks from CAFE, but not minivans, and people turned to trucks and SUVs (classified as light trucks). Since government cannot directly regulate demand, and gas suddenly became cheap and plentiful, people flocked to buy trucks and SUVs for their wants and needs. This demand spurred the development and production of profitable trucks and SUVs by the automakers. This product line morphed from the utilitarian Broncos and Blazers of yesteryear to an explosion of creature comfort Explorers and Trailblazers that we see today.

What irked many people is the fact that government didn't respond to update the impotent CAFE standards to include light trucks and SUVs to match the buying and usage pattern of the general public, where these vehicles were now generally used for personal transportation and not business. The spirit of why CAFE was put in place in the first place became lost and forgotten. CAFE became a lame issue with government, buoyed by the fact that the 1978 standards were being met with fuel injection and electronic engine management technology, fuel was cheap, and there was no outrage by the public.

Apart from the nice story, you can expect the new CAFE to raise the price of large vehicles substantially, and perhaps lower the price of small econoboxes. Besides the introduction of new and undoubtedly expensive technology in the next generation of vehicles, this is the only way automakers will meet CAFE standards.

All of this is written from memory so I may have some of the details wrong, but this was the gist of how CAFE came to be and what resulted from it. Please correct me as necessary.

 

[Gary Allan]

Yes, Kestas. When the first Escorts were sold (I forget the year(s)) Ford lost money on every one sold. Now they don't do that anymore ..but close enough.


It took until about 2002 (I forget the exact year) to move the LT/SUV into the CAFE umbrella. That's when the "crossover" term came en vogue. Essentially the station wagon that you've been driving in pseudo truck clothing will more conform to a station wagon.

 

[Shannow]

Originally Posted By: Duffman77
Shannow,
Two issues will come out of this.

1) The government will overflow with tax revenue allowing corporate and sales taxes to be cut to offset cost increases seen by the consumer due to trucking costs. Some items will be hurt more than others and this will further reduce demand for oil.

2)Doug raises the other but I do not agree with his assessment. As transportation costs rise, intelligent business will find ways to reduce costs and less transport will be done by the least efficient method (Air) and will trickle down to the most efficient method (Rail). It would become more imperative for trucks to operate at their GCWR so efficiency will be found again. Finally, the fuel cost/labour cost ratio changes making it cost effective for trucks to slow down and find more MPG. When fuel is cheap it is easier to be wasteful as we see with empty SUVs driving around.


Only problem with your assessment Duffman is that there are zero taxes paid on fuel for airliners, due to an international agreement on not being able to agree on a single, appropriate tax.

It annoyed the heck out of Australians, who are paying around 100% tax (i.e. 50% of the purchase price).

 

[Doug Hillary]

Hi, Duffman77 – Your hypothesis may be correct in some cases. In Australia and many other Countries the use of rail is sidelined due to the time/cost/convenience factors. Unless of course for bulk or Container movements Sending a (typical) freight consignment by rail means trucking costs for pickup and delivery and high handling (labour) costs and the resultant delays. In Australia some line haul “legs” are very long (4000kms etc) and coordinated rail does offer some advantages. For others, up to 1500kms which forms the bulk of our land transport Trucking is most competitive. We do have some of the best rail freight operators around and they do a great job for most freight that in not time sensitive

As for looking for “cost cutting” or “innovation” in Trucking, well, very few avenues exist in a modern society like ours. In fact the pressures on the Industry to deliver within a narrow time spread, and the image of truck accidents makes Legislators more likely to penalise the Industry further. I have been in this business since the mid 1970s as a Legislator (NZ/OZ), an Industry Consultant and a Fleet Owner. I was involved in the “old” FMVSS121 braking Legislation in NA via the ATA in the 1970s, in setting road user charges elsewhere and in establishing the Legislation that enables the use of “B” doubles and near City Road Trains in this Country. I have been very deeply involved in three Road Transport Industry Inquiries and as a Arbitrator/Adjudicator during more than one Industry Blockade I can honestly say that most Fleets here are only marginally profitable and most are very very efficient Operators. Fleet owners get around 19c/ltr rebate on diesel fuel – the rate is calculated via a road user charge matrix and etc.

The very latest in Euro and NA technologies is married here with our excellent and innovative trailers. Our Drivers are hard workers - and their hours are a constant topic of discussion in the Press - and at Govt. levels

At least four Major Fleets have gone into receivership and liquidation in the last few months!

Road Transport here is already being carried out at less than cost price! The end user is the prime beneficiary!!

 

[Bamaro]

Originally Posted By: exranger06
Originally Posted By: Bamaro
Feebates are the answer. The more gas a vehicle guzzles (yup, cars, minivans, SUVs, crossovers, pickups, whatever) the higher the fee paid at purchase. The less gas sipped, the bigger the rebate. It could be structured as a zero gain/loss program. The fees would pay for the rebates.

There already is a Gas guzzler tax. It only applies to sports cars and the like that are gas guzzlers, not SUVs and trucks, but that could easily be changed.
Owners of hybrids also already receive tax rebates and other benefits too.

True but it only touches the extremes. A properly designed feebate would affect around 90% of the vehicles.
As far as accomplishing the same sort of thing with a gas tax, that would be good also but probably unpalatable to the motoring public.

 

[typ901]

Originally Posted By: 01rangerxl
Honestly, I think it's great that SUVs have fallen out of popularity. Maybe now they can return to their roots instead of being glorified cars with little off road capability.


Totally agree. I only use my old SUV when I go to Home Depot, large grocery shopping, (Costco style!) and when it snows. I broke the mold and paid it off in 3 years too. Nice to own vehicles and skip the payment and pocket the cash to pay for the gas and increasing insurance rates... Dealers are still asking premium prices for certain models which is annoying- I love to deal.