The paper, written by Christopher R. Knittel and registered with the National Bureau of Economic Research (NBER), posits the following in it's abstract:

New car fleet fuel economy, weight and engine power have changed drastically since 1980. These changes represent both movements along and shifts in the "fuel economy/weight/engine power production possibilities frontier". This paper estimates the technological progress that has occurred since 1980 and the trade-offs that manufacturers and consumers face when choosing between fuel economy, weight and engine power characteristics. The results suggest that if weight, horsepower and torque were held at their 1980 levels, fuel economy for both passenger cars and light trucks could have increased by nearly 50 percent from 1980 to 2006; this is in stark contrast to the 15 percent by which fuel economy actually increased. I also find that once technological progress is considered, meeting the CAFE standards adopted in 2007 will require halting the observed increases in weight and engine power characteristics, but little more; in contrast, the standards recently announced by the new administration, while certainly attainable, require non-trivial "downsizing". I also investigate the relative efficiencies of manufacturers. I find that US manufacturers tend to be above the median in terms of their passenger vehicle fuel efficiency conditional on weight and engine power, and are among the top for light duty trucks; Honda is the most efficient manufacturer for both passenger cars, while Volvo is the most efficient manufacturer of light duty trucks. However, I also find that over time, US manufacturers' relative efficiency in both passenger cars and light trucks has degraded. These results may provide insight into their current financial troubles.

First we'd just like to say as consumers of horsepower and torque, we're quite happy with the improvements since 1980. We're wondering if Mr. Kittle has ever tried to merge into freeway traffic in a 1980 Toyota Corolla. Not a pretty sight.

In any case, the content of the study would be far more interesting to us if it didn't seem from the outset the author was only interested in painting automakers as wasteful and the automobile and its consumer the same way. We say this because despite mentioning technological advancement since 1980, there is absolutely no mention of the government mandates in improvement to emissions and safety. We can understand a statistical analysis of fuel economy versus weight and power, but to completely ignore mandates which add considerable girth to a vehicle is a major oversight which seems intentional.

Sure, cars are much bigger and more powerful than they were in 1980, but they also always start in the morning, aren't actively trying to kill you in a crash and don't spew blue smoke anymore. The inclusion of primary, secondary and now tertiary airbags alone adds weight and cost, not to mention ever increasing structural requirements in both the safety cage and crumple zones. We're not saying we don't like the idea of the study, as more information put into context is always better, but when you leave out an obvious weight driver the whole affair is suspect. (Thanks for the tip Andrew)

[NBER]

Photo credit Think Or Thwim, sculpture by Irwin Wurm

The whole segment is a four minute scare tactic about the Department of Transportation's CARS Act "Cash For Clunkers" dealer website. In order to process rebates, a dealer must sign on to the DoT system and then, according to "Prosecutor Kim," the government can "basically track you, basically forever." Yeah. not quite. Here is the, admittedly, scary sounding verbiage:

"This application provides access to the DoT CARS system. When logged on to the CARS system, your computer is considered a Federal computer system and is the property of the U.S. Government. Any or all uses of this system and all files on this system may be intercepted, monitored, recorded, copied, audited, inspected, and disclosed to authorized CARS, Dot, and law enforcement personnel, as well as authorized officials of other agencies, both domestic and foreign."

If you watch the Glenn Beck show, or read various websites, they're exclaiming this is the end of the world.

So does this mean dealer computers are being taken over? No. For starters, this is only seen on the dealer side of the CARS website, so it isn't for everyday consumers. Secondly, it's a carelessly written statement created by some bureaucrat to say any uses of the CARS system can and will be recorded and monitored. This is to help prevent against crime and abuse. Unfortunately, as written, it sounds like the dealer's computer is going to be taken over.

Beck called the people behind this system "evil, wicked, crazy, frightening people," but, according to Rae Tyson, spokesman for the National Highway Safety Transportation Agency, this was just a boiler plate statement regarding the secure portion of the site used on many other government websites. To avoid more confusion it's been removed.

"It's nothing sinister and it's not related to the general public," said Tyson. "People who log into Cars.gov don't need to worry, dealers who log into Cars.gov don't need to worry."

Of course, that's exactly what they would say. Mwwhhahahahahhah! (H/T to Richard!)

If you'll remember after reading our Cash For Clunkers guide, the original bill, as passed by the U.S. House, would have provided $4 billion in incentives for trading in an older, conceivably more fuel-inefficient vehicle for a newer, possibly more fuel-efficient one. Then the Senate gave it the ol strip n' flip, leaving it at just a billion dollars.

But, the House passed the new bill by a vote of 226-202, so now it's back on to the Senate for either passage or crushing, depending on whether Senator Harry Reid thinks he can maybe turn it in for a nice, new Toyota Yaris. [via Auto News (sub. req.)]

Photo Credit: THEO HEIMANN / DDP

Previously, under the American Recovery and Reinvestment Act of 2009, taxpayers who buy a new motor vehicle this year are entitled to deduct state or local sales or excise taxes paid on the purchase. The Treasury Department has determined that purchases made in states without a sales tax — such as Alaska, Delaware, Hawaii, Montana, New Hampshire and Oregon — can also qualify for the deduction. We're not really sure how as they haven't paid any sales tax, but whatever, who are we to argue?

To qualify for the deduction, the vehicle must be purchased after Feb. 16, 2009, and before Jan. 1, 2010. The special deduction is available regardless of whether taxpayers itemize deductions on their returns. Taxpayers can claim this special deduction only on their 2009 tax returns next year. The deduction is limited to the fees or taxes paid on up to $49,500 of the purchase price of a qualified new car, light truck, motor home, or motorcycle. We have no idea what "qualified" means but we're hoping it doesn't only mean this.

The General Services Administration supplies the U.S. Government with pretty much everything it needs to function. Among those supplies is a worldwide fleet of some 650,000 vehicles. The plan calls for some 17,500 vehicles to be purchased under existing agreements with Ford, GM and Chrysler to replace aging vehicles in the fleet. The $285 million is part of of the economic stimulus bill passed earlier this year by Congress, which budgeted $300 million for vehicle upgrades. The vehicles will include about 14% hybrids among the mix of cars, trucks and SUVs. At least Uncle Sam is getting something for its money this time. [World Car Fans]

The new law would make texting or playing video games while driving a secondary offense, which means that a driver could receive a ticket if pulled over for something else, but not be rolled for simply texting. The fine would be set at a non-negotiable $100. Senator Buzz Thomas had attempted passing an identical piece of legislation earlier that didn't make the cut. Buzz stated texting "is one of the most dangerous things a driver can do."

Although our official response is one of happiness for getting drivers-who-text off the roads, we did ask Jalopnik's resident "txtng xprt," Ben Wertigree, for his opinion. He replied,

"LOL OMG suk my blz"

There you have it.

[Freep]

This is the first such fee in the nation on the state level. Here's what the The Boston Globe says Gov. Patrick has to say about his plan:

Patrick said today that his administration is looking at the Registry of Motor Vehicles fee structure to create "differential fees based on the efficiency of the vehicle or the emissions of the vehicle."

"Big gas guzzlers will pay more for their registration," he added. "Plug-in hybrids would pay less and you'd have a range, that kind of thing."

Patrick's office declined to elaborate on the proposal or say whether it would appear as part of his overall transportation plan. RMV spokeswoman Ann Dufresne said state transportation officials have been discussing a gas guzzler fee program, "but I think they're still trying to flesh that out now."

Patrick said today that he was continuing to look at raising the state gas tax, but did not commit to it. When asked about it during the Chamber event, he threw the question back to the audience, asking by a show of hands whether the crowd favored a gas tax increase or a toll hike. The crowd chose the gas tax, which has generally been a more popular proposal in the business community.

We wonder where diesels and hybrid SUVs and pickup trucks will fit into this plan. Maybe we'll call up his press secretary today and ask, but our guess is he may not have thought about that question yet. [Boston.com]

The Sichuan Earthquake, otherwise known as the Wenchuan Earthquake due to its epicenter, absolutely ravaged mainland China. The quake measured in at an 8.0 magnitude and is regarded as the nineteenth deadliest in history, taking the lives of at least 87,000 people, leaving 18,000 missing, more than 374,000 injured and millions homeless. To put that into perspective, the 1906 San Fransisco earthquake was a 7.8 magnitude, but only took the lives of an estimated 700 people.

In November of 2008, only a few months after the earthquake, the central Chinese government announced it would spend 1 trillion yuan ($146 billion U.S.) to help with the rebuild and rescue efforts.

After investigating China's National Audit Office, it was found that there have been close to 2,000 complaints of corrupt behavior with some local city officials exaggerating the death tolls in their counties in order to gain a larger portion of the relief aid. The tourism bureau and transport department of Chongzhou City filed their paperwork twice allowing them to snag 1.23 billion yuan ($180 million U.S.) of additional aid.

A small portion of the 1 trillion yuan was supposedly sent to Beichuan, to be handled by the Beichuan local government, and now news reports are coming to light stating that the central Chinese city of Beichuan has also been involved in scandolous uses of the relief aid.

Beichuan County has roughly 160,156 people occupying its borders and only 20,000 living in the town itself. The city became well known after 80% of the city's buildings were severely damaged or collapsed and for being the location of the Beichuan High School where more than 1,000 students were killed after two of the school's main buildings collapsed.

Questions have been raised recently about local officials receiving large bonuses and acquiring luxury vehicles in the last couple of months and upon an official investigation probing the Mianyang Purchasing Network, the company that handles the local governments large purchases, certain documents have briefly surfaced. We say briefly because just as soon as they surfaced they were apparently deleted from Mianyang's official records, in hopes to never be seen again. Luckily, they weren't the only holders of these documents and they've finally been leaked to the media. The documents show that from the time the Beichuan government received the domestic support money, millions of yuan had been spent on high-end luxury vehicles.

According to MOP:

"Beichuan's go-vern-ment purchased one Toyota Land Cruiser, the most expensive V8 configuration, price 1.1 million RMB (or $160,653 U.S.) - the lowest version is only 700,000+ RMB, but a six cylinder is not impressive. I discovered a wide variety of brands and models amongst the disaster area purchased vehicle, but with almost every model, relatively higher-end versions wer chose. For example, a Toyota Prado was purchased with a navigation system. The earthquake must have ruined the disaster area's geography so much that the leaders no longer remember the roads."

In fact, the vehicle spending tally is apparently 5,541,959 yuan or $744,887 (U.S.). The amount of money spent on the luxury goods pales in comparison to the total relief of 1 trillion yuan ($146 billion U.S.) and while most of the vehicles listed are not what we'd consider luxurious in the U.S., the Chinese considered them to be excessive purchases made by taking advantage of a very loosely-tracked central government relief fund. We understand that many of the Beichuan government's vehicles were likely destroyed in the earthquake, though the majority of the new vehicles were purchased with additional unnecessary options or were simply the more expensive upmarket version of that particular model.

According to MOP, the various vehicles purchased by the Beichuan local government were the following:

Toyota Land Cruiser Prado

Toyota Camry

Hyundai Tucson

Nissan X-Trail

1. One Changfeng Liebao cross-country, Chengdu Jielong Trading Company, price 196,500 yuan (free decoration). ($28,698)
2. One Toyota Camary, Mianyang City Baixiang Automobile Sales Services Company, price 216,800 yuan.($31,663)
3. One Nissan X-Trail, Mianyang City Fengshen Automobile Sales Services Company, price 275,000 yuan (free floormats). ($40,163)
4. One Toyota Prado 4.0GX cross-country, dark green color, Mianyang Gaoxing Toyota Automobile Sales Services Limited Company, 539,000 yuan. ($78,720)
5. Nissan Teana: Mianyang Fengshen Automobile Trading Company, price 204,800 yuan ($29,910)
6. Changfeng Liebao: Mianyang Beier Automobile Services Company, price 197,800 yuan ($28,888)
7. Toyota Corolla: Mianyang Gaoxing District Toyota Automobile Sales Services Company, price 155,800 yuan ($22,754)
8. Beijing Hyundai Tucson: Mianyang Xinchuansa Automobile Sales Services Company, price 247,800 yuan ($36,190)

Mianyang Government inquiry (2008), #85, "car" item inquiry result notice
Mianyang Government inquiry (2008), #85, "car" item, on 2008 September 12 conducted procurement, the results announcement as follows:
The successful candidate:
Sichuan Mianyang Xinhua Car and Automobile Sales Garment Co., Ltd.: 843,000.00 yuan ($123,119)
Mianyang Gaoxing District Toyota Motor Sales and Service Co., Ltd.: 584,000.00 yuan ($85,292)
(Probably Toyota's new Land Cruiser and Prado)

Beichuan BCZC inquiry (2008) #17 work vehicle procurement notice
Bidding work unit:
Mianyang Gaoxing District Toyota Motor Sales and Service Co., Ltd. total price 539,800 yuan. ($78,837)
(Should be Prado)

It saddens us to hear of this and we would certainly hope that something like this would never happen within our own borders. Yeah... right.

(photo credits, Getty Images)

[via Telegraph.co.uk,chinasmack, eathquake.usgs.gov, MOP]

In response to the awful, no-good, very bad car sales market, the Senate voted overwhelmingly, 71-26, in favor of a provision allowing a tax break for someone buying a new car or light truck in late 2008 or 2009. It's estimated this will save the average family $1,500 towards the purchase of a new car costing $25,000.

How does it work?

The Auto Assistance Ownership Amendment makes interest payments on loans and state sales/excise car taxes deductable for any new car sold between November 12, 2008 and December 31, 2009. There are some caveats: if you make more than $250,000 a year as a family or buy a car costing more than $49,500 you're not going to qualify. Still, a new CTS still comes under $50K. Obviously, if you pay in cash you're not going to get the savings. Of course, if you can drop $25K on a car in cash you probably still have your job.

The statement from Senator Barbara Mikulski, author of the amendment, below:

Senate Approves Mikulski's Auto Amendment

WASHINGTON, D.C. – U.S. Senator Barbara A. Mikulski's (D-Md.) amendment to the American Recovery and Reinvestment Act to save American jobs and help American consumers by giving tax relief to new car buyers was approved by the Senate today.

"Today the Senate voted ‘yes' to getting our economy rolling again," Senator Mikulski said. "President Obama said the goal for the economic recovery program is to create jobs and save jobs. That's exactly what my amendment does. It's targeted at saving American jobs and helping families buy the cars they need to get to work and take their kids to school. Our economy is teetering, and Congress must take swift action to save jobs and lend a helping hand to struggling families. That's what we did here today."

Senator Mikulski's amendment, the Auto Assistance Ownership Amendment, makes interest payments on car loans and state sales or excise car tax-deductible for new cars purchased between November 12, 2008 and December 31, 2009, which, in turn, will help more Americans afford cars during these tough economic times and spur investment in America's ailing automobile industry. For more information about Senator Mikulski's amendment, go to: http://mikulski.senate.gov/_pdfs/Press/autoownershiptaxamendment.pdf

The American automobile industry is currently one of the biggest drivers of the U.S. economy. One out of every 10 jobs in America is auto-related. A collapse of a major U.S. automaker, such as GM, Ford or Chrysler, would further erode the American economy, given the huge network of suppliers, dealers, and other businesses and communities that would be affected. Already this year the U.S. auto industry has shed 110,000 jobs. In Maryland, approximately 500 jobs have been lost this year due to the closing of automobile dealerships.

Co-sponsors of the amendment include: Senator Sam Brownback (R-Kan.), Senator Debbie Stabenow (D-Mich.), Senator Kay Bailey Hutchison (R- TX.), Senator Jim Webb (D-Va.), Senator Sherrod Brown (D-Ohio), Senator Robert F. Bennett (R-Utah) and Senator Evan Bayh (D-Ind.).

The next step in the legislative process for the Mikulski Amendment is Senate approval of the American Recovery and Reinvestment Act. The bill then goes to conference, where differences in the House and Senate versions will be resolved before the legislation is sent to President Obama for his signature.

Senator Mikulski's remarks, as prepared for delivery on the Senate floor, follow:

"Mr. President, our economy is in shambles. Our unemployment rate is at a 16-year high. More Americans are out of work today than at any other point in the last 25 years, and we lost more jobs in 2008 than in any year since 1945. People are losing their jobs, their life savings, and their homes.

"There is much work to do and no time to waste. We've already done a bailout. We've helped the sharks and we've helped the whales. Now it's time to help the minnows.

"I have a proposal that will help. I am offering an amendment, co-sponsored by Senator Brownback, to save the American automobile industry, to help consumers to get our economy back on track, and to help state governments get more revenue. "It's simple, it's straightforward, it's bipartisan. It's also timely, targeted and temporary. And it saves jobs. Everyone wants to save auto manufacturers, but no matter how much government aid we give to the Big 3 auto makers, they can't survive if consumers don't start buying cars. That's where my amendment helps. "I want to stimulate demand in the automobile industry so that people go to showrooms and buy cars. Why is this a good idea? If you buy a car, someone's got to make them, someone's got to sell them, someone has to service them and someone has to provide administrative services. So this amendment is good for the manufacturers, the dealers, the suppliers and the consumers. "My amendment is simple. If you buy a new passenger car, minivan, or light truck by December 31st of 2009, you will get a tax deduction for your sales or excise tax and the interest on your loan. A family would save about $1,500 on a $25,000 car, not counting the additional incentives from dealers.

"My amendment is not about bailouts. It's about jobs, jobs, jobs. Six million jobs are at stake in the American car industry. One out of 10 jobs in America relates to the auto industry. Right now the facts are gloomy. If we lose the Big 3, then 3 million jobs are at risk. The only way to save the Big 3 is to get people into showrooms, but 1,000 dealerships could close this year. That's 53,000 jobs that could be lost just at the dealerships. I believe we can help by getting the consumer into the showroom. They will know that the government is on their side and helping them with one of the biggest purchases they will make during this tough time.

"My amendment also helps state governments. States rely on tax revenue from new car sales. In my home state and many other states the sales tax is around 6 percent, so on a $25,000 car the state gets $1,500 in revenue. New car sales are down millions per year from their averages. This means states are losing billions when they already are struggling. My amendment will help because as people buy new cars states' tax revenues will increase.

"This amendment is a big deal to families because a car is the second biggest purchase most families make. My amendment is targeted. Families with an income of more than $250,000 a year are ineligible. Cars costing more than $49,500 also are ineligible. This amendment also helps the environment because it gets more people into new cars and new cars are cleaner and more fuel efficient than old cars.

"There are 20,000 new car dealerships nationwide. They employ a million people. In my own home state, there are around 300 dealerships. Most people don't realize that dealers employ an average of 53 people in sales, mechanics, and administrative positions. I visited car dealerships in Maryland and heard from these employees.

"I've talked to people like the mechanic who works for a Chevy dealer in Bethesda. He's worked there for 23 years. He said to me, ‘Senator Barb, all my life I've loved to work on cars. I just love it. I love to fix them, I love to repair them. If they're new, I want to make sure they're fit for duty. I've earned a good living. I've been happy and I think I've helped make a lot of other people happy. But the only way I can stay happy is if I continue to work. I've got a mortgage. I've got two kids in college. Maybe they're going to go into engineering, I don't know, but if we don't get more people into this dealership, my job could be gone.'

"And I talked to the dealer. The dealer's name is Sam. The first thing you note about him is that he wears the little rotary pin because he's the guy that not only provides jobs in the community, he is also part of the Chamber of Commerce and part of the United Way.

"We are talking about people who are part of the fabric of our society. We are not talking about an abstraction and we're not talking about a single zip code, like Wall Street. We are talking about the automobile industry, which is in every state and every community.

"Maybe you know somebody who works for a hedge fund. I don't. But I do know the people who work for the automobile industry, like the receptionist who went to work at a dealership 43 years ago right out of high school. And she said, ‘Senator Barb, women couldn't sell cars in those days, but I've been here in and out of this same dealership for 43 years. I've raised my kids and earned a good living doing the back office work and I want to keep on doing it. I'm not ready for Social Security and for God's sake don't put the money in Wall Street.'

"Well, I say let's put money where it matters — where it creates jobs. That's why we need this amendment — for creating jobs, for consumers, and for the auto industry that is such a driver of our country's economy — so we can get America rolling again."

Photo Credit: KAREN BLEIER/AFP/Getty Images

[Mikluski.Senate.Gov, Politico]

The GM "Plug-In-Ready" program is a plan to get the biggest target buying markets for the 2011 Volt ready to accept the car and maximize it's effectiveness as a plug-in. It's also part of the ongoing effort to work out how electricity providers commercialize the infrastructure needed to support plug-in hybrids and manage billing rates to the consumer.

The first efforts of the program are centered on the metropolitan areas of San Francisco and Washington D.C. as well as areas identified as lousy with early adopters. This news comes on the heels of announcements last fall from cities and municipalities planning partnerships with Better Place, a plug in power post company.

This kind of background information serves as a reminder this Volt thing is more than a project about just the car. GM has taken a big bite here and is chewing it's way through an awful lot of problems. Hopefully they don't choke on it.

General Motors Outlines Roadmap for Cities to Plug Into the Chevrolet Volt Electric Vehicle

* Plug-in-ready communities key to commercializing electric vehicles
* Next phase of getting the Volt ready for market will include communities such as Washington, D.C., San Francisco and other early-adopter markets
* GM and a broad group of utilities working together to establish infrastructure and accelerate the commercialization of plug-in electric vehicles

WASHINGTON - General Motors today outlined a comprehensive plan of action to help communities get ready for plug-in electric vehicles such as the upcoming Chevrolet Volt. GM announced details of the plan at the Washington Auto Show.

"Collaborating with communities such as San Francisco and metropolitan areas such as Washington, D.C. - where there's already an interest in plug-in vehicles - is another important step toward raising customer awareness of the environmental and economic benefits of vehicles such as the Volt," said Ed Peper, GM North America vice president, Chevrolet.

General Motors is working with key stakeholders in cities such as San Francisco to develop policies and enablers to accelerate the transition to plug-in electric vehicles. GM will undertake similar efforts around the country in communities such as Washington, D.C. These actions will help ensure the early success of the Chevrolet Volt - which hits the market next year - and other plug-in vehicles. Stakeholders that are key to establishing plug-in-ready metropolitan areas and regions include:

* State, city and county governments
* Electric utilities
* Regulators/public utility commissions
* Permitting and code officials
* Clean Cities coalitions
* Local employers
* Universities
* Early electric vehicle adopters

"Cities have an indispensable role in making plug-in vehicles successful," said San Francisco Mayor Gavin Newsom. "Here in San Francisco, we are acting now to make sure the charging infrastructure will be available to support these vehicles as soon as they are ready for sale, and we are working with other cities in the region to make the Bay Area a thriving market for electric transportation."

Challenges that need to be addressed include consumer incentives to make this early technology more affordable; public and workplace charging infrastructure; consumer-friendly electricity rates and renewable electricity options; government and corporate vehicle purchases; supportive permitting and codes for vehicle charging; and other incentives such as high-occupancy-vehicle (HOV) lane access.

GM is making great strides toward bringing the Volt from concept to the showroom. More than 30 prototype vehicles powered by lithium-ion battery packs are undergoing rigorous testing at GM's Proving Ground in Milford, Mich. In addition, last month at the North American International Auto Show in Detroit, GM announced it will manufacture the Volt battery packs in the United States.

"The Chevy Volt is truly coming to life, but preparing the market for electric vehicles also requires capable partners from outside the auto industry," said Peper. "Momentum is building as governments, technology companies, communities and universities are increasingly working together to prepare the market for electric vehicles."

Several recent positive developments in this regard include:

* Last October, the federal government approved a $7,500 tax incentive for consumers of plug-in electric vehicles such as the Chevy Volt.
* In November, the California cities of San Francisco, San Jose and Oakland announced a plan for plug-in vehicle infrastructure, incentives and enablers.
* A new Michigan law expedites the development of advanced battery manufacturing and research capabilities in the state.

GM is also helping to pave the way to plug-in commercialization on several other fronts, including:

* Working with the Electric Power Research Institute (EPRI) and a coalition of more than 40 utilities to solve challenges and accelerate the commercialization of plug-in electric vehicles.
* Playing a lead role in helping to create Society of Automotive Engineers (SAE) standards for the vehicle charging interface.

"We know plenty of work still remains, both within and outside of GM," said Peper. "But today's and other recent announcements underscore the comprehensive work being done to bring the Chevrolet Volt and other electrically driven vehicles to market - and they also highlight why we are so optimistic about the ultimate success of the Volt."

[Source: GM]