Is The First World Hitting Peak Car?

When historians look back on this moment in history, will they see a turning point? It is possible, as new studies seem to confirm what many people have already assumed; the developed world has hit peak car saturation. Since the massive economic meltdown of 2007-08, car sales have shrunk, and continue to shrink, not just in the U.S. but also in Europe. But don't celebrate yet.

U.S. new car registration reached 14.5 million vehicles in 2012, which is a big comeback from post-recession years, but still a far cry from the more than 16 million vehicles sold in 2007. But more importantly, a new study shows that Americans are also driving less, and unlike auto sales, the number of culmative miles driven seems to be dropping.

As this chart indicates, Americans drove three times more in 2007 than they did in 1975, racking up more than 3 trillion total miles driven. But after 2007, total miles driven has dropped by more than a 100 billion miles in the U.S., and seems like it may continue to go down. Americans are getting around by other means.

In Europe, the story is much the same; new car registrations are estimated to be around 12.5 million vehicles, and could drop to as low as 11 million cars in 2013. This is the sixth-straight year in which new car sales slowed, as increasing fuel costs and ample public transit options convince Europeans to walk, bike, and take the tube as frequently as possible.

But then there is China, India, and the rest of Southeast Asia. In China alone, there were 19.3 million new car sales despite what can only be described as the ninth level of Traffic Hell and air so thick with pollution that Beijing advises residents not to go outside. And yet car sales in China are still projected to go up another 10% in 2013. There are still plenty of aspirational human beings who need, and want, motorized transportation.

Yet in the Europe and U.S. at least, cars seem to have reached peak popularity. What does this mean for automakers? A lot of things. Suffice to say, this may be a very important point on history...or perhaps just another blip on the graph.

Source: Quartz | Picture: dcmaster

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Fiscal Cliff Deal Extends/Improves 12 Alt-Energy Credits

While most Americans were enjoying the holiday break, Congress was called in for a special session to try and work out a deal to avoid the so-called "fiscal cliff." A compromise was reached, a deal was passed, and while nobody is particularly happy with the "American Taxpayer Relief Act", a number of green energy credits were extended for at least another year.

The Senate version of the bill, which was passed by the House and signed by President Obama late last night, includes 12 green energy credits or extensions for the year 2013. In no particular order, these credits are;

• Credit for energy-efficient existing homes is extended to 31 December 2013.
• Credit for alternative fuel vehicle refueling property is extended to 31 December 2013.
• Credit for 2- or 3-wheeled plug-in electric vehicles. In the case of a qualified 2- or 3-wheeled plug-in electric vehicle, up to 10% of the cost of the qualified 2- or 3-wheeled plug-in electric vehicle, or $2,500 may be allowed as a credit.
• Qualifying 2- or 3-wheel vehicles need a 2.5 kWh pack (down from 4 kWh), are capable of achieving a speed of 45 mph (72 km/h)or greater, and must be acquired after 31 December 2011 and before 1 January 2014.
• Extension and modification of cellulosic biofuel producer credit. The extension now carries through to qualified production beginning before 1 January 2014. Algae is treated as a qualified feedstock.
• Additionally, the section strikes the term cellulosic biofuel in favor of "second generation biofuel".
• Incentives for biodiesel and renewable diesel are extended to 31 December 2013.
• Extension of production credit for Indian coal facilities placed in service before 2009 for an 8-year period rather than a 7-year period. The amendment applies to coal produced after 31 December 2012.
• Extension and modification of credits with respect to facilities producing energy from certain renewable resources. Among other provisions for municipal solid waste, hydro, and biomass facilities, production tax credits for wind facilities are extended to 1 January 2014.
• Credits for energy-efficient new homes are extended to 31 December 2013.
• Credits for energy-efficient appliances are extended into 2013.
• The special allowance for cellulosic biofuel plant property is extended to 1 January 2014. In addition, algae is treated as a qualified feedstock for such.
• The special rule for sales or dispositions to implement FERC or state electric restructuring policy for qualified electric utilities is extended to 1 January 2014.
• Alternative fuels excise tax credits are extended to 31 December.

Of special note to green vehicle enthusiasts is the extension of the up-to $2,500 tax credit for electric motorcycles and trikes, as well as the inclusion of algae as a qualified feedstock for biofuel production plants.

These tax credits go along with Obama's "All of the Above" energy strategy, but do we really need an extension of the status quo? Or would Americans be better served by more forward-thinking initiatives with more support but a more narrow focus on a select few technologies?

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