Ford Motor Put Drunk-with Power Government Autocrats in the Driver’s Seat
Let the spectacularly improvident electric vehicle subsidy scam be a belated lesson about putting power-drunk government-knows-best autocrats in the driver’s seat.
Consequentially, carmakers have jacked up prices of petroleum-fueled cars and trucks that free market customers prefer to offset huge manufacturing losses — despite taxpayer charities — for plug-in models that cost consumers more while offering them less utility combined with no operating efficiencies and higher maintenance.
Ford has recently announced plans to take a $1.9 billion write-down in cancelling production of an electric SUV and delaying an electric pickup truck after losing $44,000 on each EV it sold in the second quarter and is expecting to lose $5 billion on them this year.
Ford’s huge losses will only increase exponentially if newly ramped-up Democratically-endorsed DOT greenhouse gas tailpipe emission standards prevail, requiring companies to produce nearly four electric trucks for each gas-powered model by 2032.
This is the second time Ford has delayed opening of a new Tennessee EV truck factory, the largest in its 120-year history now tentatively rescheduled for a 2027 debut.
Instead of offering a larger electric SUV, Ford will instead emphasize marketing hybrid gas-electric versions and smaller EV models.
As Ford Chief Executive Jim Farley explained, a long-held Detroit economic principal that bigger vehicles reap bigger profit margins was "exactly opposite" for EVs, because "the larger the vehicle, the bigger the battery, the more pressure on margin because customers will not pay a premium" over a gas model simply because it is electric.
High battery costs are a big reason that most big automakers are losing money on their electric offerings.
General Motors, Volkswagen, Mercedes, Stellantis and other automakers have also curbed their EV ambitions in recent months.
Stellantis is delaying planned investments to retool its shuttered plant in Belvidere, Illinois for EV production after the Biden administration DOT offered them a $335 million grant for this purpose.
So why the change of corporate EV enthusiasm?
As Stellantis leadership explained, "it is critical that the business case for all investments is aligned with market conditions and our ability to accommodate a wide range of consumer demands."
In short, plug-in EVs are some of the slowest sellers on dealership lots, taking about twice as long to sell than gas-powered vehicles and even longer than increasingly popular gas-electric hybrids.
This should come as no surprise to government politicos and technocrats that attempt to push them up hill with the public.
Buried deeply in the bowels of a 56,342-page 2023 Federal Register Volume 88 — along with an environmental assessment accompanying the Department of Transportation's proposed fuel standards — are some candid admissions that EV bureaucrats and corporate subsidy aren’t anxious for any of us to know about.
One is that after factoring in a 2% increase in mandated requirements each year with an estimated $5.8 billion reduction in public welfare spread across the life of total drivers' cars, net costs of transportation "alternatives" proposed by the DOT are estimated at very nearly twice that amount ($11 billion).
As for this promised "auto-utopia" saving the planet from millions of years of climate change. . . no measurable benefit there either.
According to DOT’s own estimates, its proposed legislation would reduce average global temperatures in 2060 by 0.000%.
It’s not as if taxpayers haven’t paid enough for this green dream bumper sticker fantasy.
The ironically named Inflation Reduction Act dangles up to $7,500 IRS tax credits for EV consumers on top of thousands of dollars in subsidies by many states.
With no thanks to "green energy" climate regulations, increased electricity costs relative to gasoline have already left EV efficiency claims in the ditch.
The Anderson Economic Group estimates that mid-sized EVs cost between $12.61 and $16.11 to fuel per 100 miles, compared to $10.71 for gas-powered models, and for pickups and SUVs this cost differential is even larger.
In many cases, EVs make absolutely no utility sense at any cost.
Don’t count on them to get you anywhere under bitter cold Wisconsin, Minnesota, or Alaska winter conditions.
Forget them as an essential means to work on a Kansas farm, haul horses on a Texas ranch, tow a boat to the lake, or go remote off-road camping.
Nevertheless, as noted by Wall Street Journal editors, "While the [government] rules don’t dictate the specific cars or models that must be made, the [Biden] administration is remaking a major industry in a way that is Chinese-style central planning as auto makers answer first to their political overlords rather than consumers and investors."
EPA, DOT and other government agencies do this through regulatory pressures to influence rational taxpayer and consumer choices in sources of energy we use and the vehicles they purchase in direct violation of foundational free market principles and forces that underpin America’s social and economic greatness.
Meanwhile, if you’re wondering who will wind up paying for Ford’s first quarter $130,000 in losses per electric vehicle which have been calculated to equal $64.80 per gallon of gasoline saved over four years of average driving — an enormous subsidy to somebody else to use the gasoline that EV drivers are paid to forgo — then look in the mirror.
And if you imagine that a Kamala Harris administration will make future circumstances better, perhaps consider that the former senator co-sponsored the Green New Deal and supported banning sales of new gas-powered cars in 2035.
Unplug from any such delusions.
Larry Bell is an endowed professor of space architecture at the University of Houston where he founded the Sasakawa International Center for Space Architecture and the graduate space architecture program. His latest of 12 books is "Architectures Beyond Boxes and Boundaries: My Life By Design" (2022). Read Larry Bell's Reports — More Here.
© 2024 Newsmax. All rights reserved.