With gas over $4 per gallon, on average, across the country, there is now a carpet bagger economy on the Toyota Prius.
Many dealers will still sell a new one at MSRP, but you are likely to wait 10 to 12 weeks before seeing a car. Yes, if you act quickly you can buy a used Prius, but this is where the real price gouging occurs. Case in point, a basic 2007 Prius with no options and 29,000 miles will cost you around $27,000. If you bought a brand-new car identical to this in 2007, it would have cost around $24,000, and Kelly Blue Book, the authority on used car prices, says that this car is worth just under $23k today.
Obviously, there is a new supply-and-demand curve in the market. Nothing illegal mind you; this is capitalism at work, but it just doesn't seem right. Gas may go up to $6 per gallon, or oil may go down to $80 per barrel; no one really knows, and there are bulls and bears forecasting both extremes. Since rationality has given way to speculation and panic, my advice to would-be Prius buyers is:
1. Do the math. A nicely equipped 2007 Honda Civic EX with equal mileage carries a suggested retail price of about $18,300. Assuming 30 miles per gallon for the Civic, and 45 miles per gallon for the Prius, it could take around 13 years to recoup the extra money for the Prius at $5 per gallon (assuming 12,000 miles per year of driving). Now I know that there are a lot of assumptions in this formula, but suffice it to say that when you do the math, the Civic seems like a better deal overall--not to mention that the EX has a Sunroof to boot.
2. Wait. Delaying a Prius purchase could have two benefits. First off, buyers get to see whether the price of gas goes up or down. If it does go down as some predict, the Prius premium is likely to disappear faster than a Lakers fan after the NBA finals. The other advantage to waiting is that the highbrow Prius will finally get some competition moving forward. Honda is rumored to have a 2009 hybrid Fit and brand-new five-passenger hybrid--with better gas mileage than today's Prius--waiting in the wings. Rumor also has it that VW, Hyundai, Ford, and others aren't far behind with high-mileage alternatives of their own. Finally, in 2009 or 2010 Toyota will introduce its own next-generation Prius that may offer plug-in capabilities and better gas mileage as well.
Supply and demand are constant market conditions, but shortages come and go. Is a used Prius really worth a $3,000 to $4,000 premium? The answer to this question can be summed in two sagacious words: caveat emptor!
Members of the National Federation of the Blind leave a hearing in Maryland's capital, where leaders lobbied for legislation aimed at addressing the perils of near-silent hybrid cars to blind pedestrians.
(Credit: Anne Broache/CNET News.com)ANNAPOLIS, Md.--Hybrid cars may be on every environmentalist-cum-trend setter's hot list, but their surging popularity is raising alarms among the blind and their advocates, who fear the near-silent vehicles could endanger lives.
In recent months, the National Federation of the Blind has launched what is becoming an international lobbying campaign for legislation that encourages--or flat-out requires--automakers to install noisemaking technology to address those potential perils.
Top NFB leaders focused their efforts Tuesday on this quaint state capital on the Chesapeake Bay, where legislation creating a state "Quiet Vehicles and Pedestrian Safety Task Force" is pending. If Maryland passes the bill, it would be the first in the nation to take action on that front, although other states are considering similar proposals.
"As we increase the number of quiet vehicles on our streets, we increase the risk that blind and other pedestrians face," Jim McCarthy, the National Federation of the Blind's director of government affairs, told members of the Maryland Senate Judicial Proceedings Committee at a hearing about the bill. "We potentially lose our independence if these become ubiquitous."
Ideally, blind advocates would like to see states pass laws that would set minimum sound standards for hybrid and electric vehicles, but they've run into resistance from automakers on that front. McCarthy said his group views the Democratic-sponsored Maryland bill as a good "first step," although he noted that legislatures in Virginia and Hawaii are poised to consider bills that would go further.
The Maryland state bill, which also has a counterpart in the state House of Representatives, would not set any particular rules for cars bought and sold in the state. But, if passed, it would instruct a task force to make recommendations by the end of the year on "a minimum sound level and the nature and characteristics of the minimum sound to be required for all vehicles sold and licensed in the state."
The blind community is also taking its push to Congress--and abroad. On Tuesday, the NFB president was in Geneva, Switzerland, testifying about the dangers of hybrid vehicles to the blind at the World Forum for Harmonization of Vehicle Regulations, a United Nations body, according to NFB spokesman Chris Danielsen.
McCarthy and other NFB leaders sought to dispel any accusation that they're hostile to environmental progress. They said they're as pleased as anyone else about states like Maryland that have passed laws requiring a certain percentage of vehicles sold in the state by 2011 to produce low emissions.
The trouble, from their perspective, is that the growing number of vehicles that cannot be heard while operating in electric-power mode throws a wrench in a blind person's ability to negotiate street traffic confidently and independently. And, in an effort to win broader support, they're emphasizing that this isn't just a problem for blind people: All pedestrians and bicyclists should be concerned for their safety.
Carmakers, not surprisingly, have bristled at the notion of regulations requiring them to adopt a specific technology in their hugely successful hybrid vehicles. The Maryland bill clearly attempts to blunt some of those gripes by specifying that task force members are not "required" to specify a certain technology that car manufacturers must use to meet recommended noise levels.
No car industry representatives were present at Tuesday's hearing here, but in a letter to the state senate committee, the Alliance of Automobile Manufacturers said it supported the bill, albeit not without reservations.
The trade association--which represents BMW, Ford Motor, General Motors, Toyota, Volkswagen, and other major carmakers--said it would be pleased to take a seat on the task force but worried the bill puts too much emphasis on noise-generating technology alone.
The car makers encouraged legislators to be open-minded about the range of technologies that could be used to resolve the blind community's concerns and also noted that a committee established within the Society of Automotive Engineers, an industry-sponsored group, is already researching such approaches.
For instance, they pointed to the potential use of a forthcoming wireless warning system that will allow cars to talk to each other and to roadway infrastructure. That system, known as Dedicated Short Range Communications, or DSRC, could be used to warn pedestrians, blind or otherwise, of oncoming cars with "far more specificity, meaning, and context" than a simple noise generator, but the wording of the current Maryland bill seems to preclude the task force from considering that option, the AAM suggested.
It wasn't immediately clear what the bill's chances of passage were. Legislators on the Senate committee had few questions for the bill's advocates and did little to show their leanings. The Maryland Department of Transportation, for its part, said in a statement that it supports the measure because it views quiet vehicles as an "emerging" safety issue that warrants more research. (There was no mention from the various stakeholders of what role that drivers could or should play in ensuring pedestrian safety.)
Michael Gosse, president of the National Federation of Blind of Maryland, said all his group wants is a cost-effective solution based on the sounds that cars are already capable of making.
"I don't know about you," he told the state senate committee, "but I don't want cars going down the street beeping like those little carts do in the airport. I think that would be pretty annoying."
As with most things, there is a right way and a wrong way to go about electric vehicles. Last Friday, Ian Wright and I spent a couple of hours around my conference table discussing our philosophies on electric cars. Wright knows something about this topic, as he was formerly an executive at EV start-up Tesla Motors, and is now the founder and CEO of Wrightspeed, a Silicon Valley-based start-up whose first car is going to be a high-performance electric supercar, price tag just shy of $200,000. And as it's electric, Wright expects it should out-start, outrun, out-turn, and generally outperform anything in its class.
The Wrightspeed X1 prototype.
(Credit: Michael Kanellos/CNET Networks)Cleantech Blog has written extensively about EVs. I am known among my friends as being a real skeptic when it comes to EVs, but behind Wright's business plan he got my attention with two ideas that are worth repeating: payback and plug-ins.
First, Wright doesn't care about gas mileage per se; he cares about performance, power, and most importantly, payback. Focus on the vehicles actually burning the most gas, irrespective of fuel efficiency. That is, instead of making tiny, compact, fuel-efficient target cars more efficient with EV and hybrid technology--focus on the gas guzzlers. Wright's point is well taken. A small, fuel-efficient car that gets 35 mpg and drives a typical 12,500 miles per year only uses about 350 gallons per year. A large pickup truck that gets 12 miles to the gallon uses over 1,000 gallons for the same mileage--nearly 3 times as much. And if that truck is a work truck driven 25,000 miles per year, it would use over 2,000 gallons of fuel per year, nearly 6 times the little car. That truck owner may spend upwards of $50,000 in fuel over its life, where the commuter car owner may spend a small fraction of that.
When I asked him for comments on my example, Wright added: "The special case of congested city driving might be worth mentioning, since everyone thinks a lot of fuel is wasted there. But if you drive a Prius 10 hours per week in congested city traffic, it's only about 150 gallons per year! Not much point in trying to improve on the Prius for that use. (The arithmetic: Congested traffic is defined as 12 mph average; 10 hours per week would be 120 miles per week, or 6,240 miles per year. The Prius shines in this application, getting maybe 40 mpg, so 156 gallons per year.)"
Putting expensive hybrid and EV technology in the small car not only has a worse financial payback--compounding the perennial problem of EVs being too costly, but the same 20 percent efficiency improvement does very little to reduce overall fuel consumption for society compared to the same efficiency gains in a big truck that drives a heck of lot of miles.
So Wright asks, if we want to both find a way to save car owners money, and save the world--wouldn't we focus on applying technology to where the problem is the worst and the returns are the best?
When Wright looked at the automotive landscape and asked the question, where is the most fuel being burned, and how do we reduce that with technology? The answer? Performance cars and big work trucks. Not surprisingly, these are his target markets.
And why are high-performance vehicles like sports cars and Ford F350s so fuel-inefficient anyway? Take this as an example answer. If you need a big truck to have lots of power for short periods of time (for instance, in towing), then the truck engine and systems have to be sized to deliver the maximum power. But anytime you're not using all that power (i.e., most of the time), the truck is usually running well below its optimum--and burning lots of fuel for no extra gain. It's the same rationale for a sports car designed to run optimally at 90 mph, which performs worse at the average driver's speed of 50 mph to 60 mph.
Wright's more detailed explanation to me put it very elegantly: "Roughly speaking gasoline engines are most efficient at wide open throttle and the rpm that gives max torque. If you try to operate a supercar at wide open throttle, it will be doing 200 mph, and of course you'll be losing most of the energy to aero drag. The engine will be operating efficiently...but if you operate the car down where aero drag is reasonable--50 mph--then the engine will be operating at a few percent of rated power, and very inefficient. Why is it inefficient? The simple answer is that since the throttle is almost closed, there is almost a vacuum in the intake manifold, and the effective compression ratio is very low. You are trying to compress a vacuum. Engine efficiency is very dependent on compression ratio.
"Eighty years ago, there were cars that could transport a family of four at 50 mpg. The Austin 7 comes to mind. Engine technology has improved dramatically since the '30s, yet the best modern cars don't do any better than the Austin 7. Why is that? One big reason is that the Austin 7 had, well, 7 horsepower (actually about 10 hp--the "7" was "RAC hp"). So it was working hard most of the time. The family car that my wife drives makes 250 hp, and that's just an average family car these days.
The X1's license plate, which makes the car street-legal in California, indicates how it compares in energy consumption with a regular car.
(Credit: Michael Kanellos/CNET News.com)"So if you displace the Prius with an EV, you can get maybe a 2x efficiency gain. But if you displace a high-performance vehicle that operates most of the time at low power settings, you can get a 10x efficiency gain. That's the main reason that 18 wheelers aren't a good target. They have powerful engines, but their power/weight ratio is very low (when fully loaded) and the engines work pretty hard. So in fuel per pound mile, they are pretty good already."
To deal with this issue, Wright isn't all about the all electric. He's pushing plug-in electric hybrids, PHEVs, aka gridable hybrids. Electric motors powered off of batteries charged from the wall or with an onboard diesel generator. The generator also acts as a booster for those times when extra power is required. Hybrids are really good at solving these power versus efficiency problems, since you can essentially design a system that can optimize for either performance or efficiency much easier than a straight gas or electric engine could.
Wright's vision also addresses one of the long-running Achilles' heels of electric cars--the lack of fueling infrastructure. Regardless of your feelings on the matter, it's generally bad business to try to bet on an expensive infrastructure rollout. And if it means slower and lower uptake of fuel-efficient vehicles, then calling for infrastructure change that's not going to happen is bad for the environment, too.
That's why I've been such a big fan of plug-in hybrids. We can have our cake and eat it too. It's all about payback and plug-ins. And it's good to see electric car gurus finally getting this message.
Bob Kanode, the CEO of Valence Technology, which makes lithium-ion batteries for vehicles, recently said one of the big issues for the electric car world was going to be cobalt versus phosphate. And he may be right.
A home-baked plug-in hybrid
(Credit: Tom Krazit/CNET News.com)The Wall Street Journal (subscription required) has reported that Toyota has delayed a new generation of hybrid vehicles, including a new Prius, because of concerns about safety and reliability of the batteries inside them. These batteries are lithium cobalt oxide batteries, the same chemistry used in laptop lithium batteries. (Currently, Toyota hybrids use nickel metal hydride batteries.)
Toyota was supposed to start introducing the lithium-ion hybrids between 2008 and 2010, according to the Journal. Instead, it will continue with nickel metal hydride, the Journal states.
Toyota has hotly denied the allegations that it has delayed or changed its product line. However, it affirmed a position it has stated for some time: that there are safety and reliability issues with lithium-ion batteries. The official Toyota blog states:
"We have consistently affirmed that there are many issues that need to be resolved, beyond the safety and reliability of lithium-ion batteries, before a commercial lithium-ion-equipped hybrid--and what we're talking about here is the so-called plug-in hybrid, or PHEV--is ready for the market.
"These issues include battery cost, availability, performance and packaging. All of the carmakers face the same problems when it comes to these issues. The answers, unfortunately, are not just around the corner," the blog states.
This is not a new position for Toyota. Dave Hermance, a now deceased Toyota exec often credited with bringing the Prius to prominence, voiced similar concerns about plug-ins in an interview with me in 2005.
But back to Kanode. Valence, among other battery start-ups, focuses on lithium phosphate. These batteries don't back the same energy density as lithium cobalt batteries, but they are safer.
"Lithium cobalt for cell size will give you more energy," he said last month. "But by definition, lithium cobalt will never be safe."
If Toyota is in fact experimenting with lithium cobalt batteries, and is having problems, we may be witnessing a formula war coming to a head.
General Motors, by the way, is working with A123 Systems on a lithium battery. It is phosphate based. (Altair Nanotechnologies uses a similar chemistry.)
Converting your Prius to a plug-in reduces your gas costs to around $1 a gallon and results in far fewer emissions in most cases.. They can even be used to send electricity to the grid and prevent a brown-out.
So how many are there on the road? 50, according to Felix Kramer, president of Calcars, which promotes the concept and is trying to persuade lawmakers to pass tax breaks for plug-ins. Last month, there were only about 36 plug-ins but Google employees have converted a bunch since then.
The catch? It's not cheap to convert a Prius to a plug-in. The operation costs around $15,000, according to a representative from Hymotion, which peforms hybrid conversions. A substantial portion of the cost goes to the battery. At that level, it's very difficult to justify converting a regular Prius to a plug-in in terms of dollars and cents.
The price, though, will likely decline. Hymotion recently got bought by lithium-ion battery maker A123 systems. Combining a battery company and an installer company will likely reduce the price. General Motors and Toyota have both said that plug-in hybrids are a major priority for them. Plug-ins that come off the production line will, ideally, only cost about $4,000 more than regular hybrids. That should drive sales.
And in case you were wondering, you don't lose trunk space in a plug-in. The extra batteries go in the wheel well. We went for a ride in Felix's car. It's zippy.
Attempts to power hybrid cars with solar panels have been around for a few years. But now a company called Solar Electrical Vehicles is producing commercially available after-market panels for hybrids, starting with the Toyota Prius.
Get the sun to juice your hybrid car.
(Credit: Solar Electrical Systems)The fiberglass, molded panels fit on top of 2004-2007 Prius models. They are attached using an epoxy glue. Unlike previous attempts, these panels fit the curve of the roof.
To maximize your sun power and driving range, you need a larger battery installed than what comes standard with the Prius, according to company founder Greg Johanson, who says that battery storage is the most challenging aspect for solar-powered cars.
In terms of distance, the panels will get you up to 20 miles a day, depending on the size of the battery. They can improve fuel efficiency by up to 29 percent. The standard-equipped Prius battery, recharged by the sun, will take you about two miles at under 35 miles per hour.
Johansen said that because of tax credits, getting a 1 kilowatt solar electrical system on your home to charge your car can make better financial sense than getting a solar roof on your car. But that doesn't taking into account the cool factor.
"It is way cooler driving down the freeway and have people pulling up alongside and giving you a big thumbs up. It's hope for the future," he says.
Next up on their production plans is the hybrid Toyota Highlander and other SUVs.
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