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Cash for Clunkers 2: Electric Boogaloo

Illustration for article titled Cash for Clunkers 2: Electric Boogaloo

The political news about both Democrats and Republicans in recent weeks has been dominated by how each side is reacting to the impeachment inquiry, but the news Friday that Jalopnik highlighted about Chuck Schumer’s new plan of Cash for Clunkers 2: Electric Boogaloo deserves to be discussed, too. And I love all things automotive and refuse to shut up about it (the Miata avatar should have clued you in already), so gather ‘round.


Essentially, it seems the proposal involves rebates of 3-5 grand towards the purchase of an electric vehicle (new, I assume) when the purchaser turns over their eight year-old or more internal combustion engine car, which would then be crushed. The impact of that amount to offset the cost of a new vehicle seems minimal, as the current average purchase price of a new car has ballooned to the mid-thirties, and the cost for an electric drivetrain car certainly isn’t below that threshold, so $3,000 off a new car that would likely top 30-40 thousand doesn’t suddenly make sense for the vast majority of car owners. Truly, with one of the requirements of the eligible cars to be crushed is that it be over eight years old, if the owner bought it new, then it’s all but guaranteed to be paid off in full. Older cars would make sense that they’d have lower values and also be likely in many cases to be fully paid for, meaning that someone utilizing this incentive is likely trading no monthly car payment for $600 over the next five years (or if they elect for a horrendous 84 month term, $430 monthly) to purchase $35k worth of car at 1% interest. Suddenly, that “cleaner, better vehicle for the environment” won’t be paid off until well after when the owner needs to consider if the batteries will start degrading—just take a look at the first-gen Nissan Leafs (Leaves? Does it follow normal English rules, how do we do this?) where the air-cooled battery chemistry went to shit in a few years, rendering its not-exceptional overall range even less so. Resale values similarly tanked, but that might also be due to the futuristic-suppository-styling; great for the next used buyer looking to pick one up on the cheap, but the seller was likely underwater. Even considering that less financially fortunate people may not have a fully paid off vehicle, the remaining balance is just rolled into their next set of wheels, so then the monthly hike isn’t somehow magically lessened. And with the used car market in its current state, it’s a good bet that all but the most clapped-out Craigslist beaters change hands for two or three thousand and up, so this plan requiring the owner to give up that selling price to have their previous car crushed makes this rebate seem even less helpful. And if the cars turned in are closer to the more recent model year cutoff and not some suburbanite V8 monster-truck, as far as emissions and fuel efficiency, a reasonable amount of small cars and sedans are at least a step in the right direction if we’re still using ICE cars. Yes, the transportation sector makes up something like one-third of carbon emissions; yes, despite the negative environmental impact of manufacturing the batteries for EVs, that carbon debt is quickly eclipsed by the lower emissions from charging using the power grid versus fossil fuels (and that grid itself it slowly transitioning to better sources, so that should be a net win). The short version is: going electric is good, but crushing perfectly good cars as we move to that is stupid. If this goes into effect, finding a $500 beater for the 24 Hours of LeMons race may get tougher.


Okay, that’s enough boring math—Schumer’s proposal at least brings up the point of spending some of the nearly half a trillion dollars to expand charging infrastructure, something sorely needed if our society is going to move EVs into primetime for many buyers. The charging speeds aren’t ever going to be such that you can match filling a gas tank in three or four minutes to suddenly have another 300-400 miles of range, however, unless you’re trying to cannonball across five states to bury a body in some desert wasteland and be back before the weekend’s over and your friends start asking questions—fast-charging on some current models boasts a twenty-minute charge time to get to half charge, which I think is reasonable for many (as long as the stations to do so are readily available nearby whatever activities you’d already be doing to kill the time). But there’s one more bit of math that makes this proposition ugly: with 157 million working adults in the nation, the 454 billion dollar price tag of this program works out to about $2,900 per person. Therefore, each taxpayer is likely taking nearly a $3,000 hit (assuming the tax burden is equal among all—lolz), but a select few will utilize this incentive. Yes, the government can’t create funds, and proponents will argue that this is in the overall public good to reduce emissions and spur more usage of electric vehicles, but this is something where the deficit hawks are going to have an easy time shooting some holes in the logic such that the voters are likely to fucking hate this idea. “Give away my paid off car that I like for some newfangled-hippie voltage car? And I can’t even find a place to plug it into when I go to Wal-Mart? Might make sense for them damn Millennials and their avocado-toast, but not me. Where’s that new truck with the in-bed gun racks that double as a tow-hitch to pull my house? Gimme that.”

As it stands, I think the program will be a tough sell, and would benefit from some sort of shift of the taxation burden to those who are already obscenely wealthy (unlikely, since many political campaigns still rely on wealthy donors, but I can dream) rather than the low- and middle-class. Also, spending the raised funds on general infrastructure (roads, bridges, etc.) and the charging network would be a better usage of the money, in my mind. The politicians all agree that “Infrastructure isn’t sexy,” but you know what’s even more of a boner-killer? The bridge collapse in Final Destination 5 actually coming true. So let’s get some legislators behind taking meaningful steps (and they’ll get credit!) for preventing that shit. We need to view this transition as a simple societal need to preserve the planet, and understand that if the charging network is there, more consumers will go all Field of Dreams with regards to electric car purchases. EVs growing as a percentage of new car purchases means the auto industry will invest more heavily to improve components and manufacturing, which should drive down the current additional cost of electric drivetrains and batteries. This means the “cost for entry” gap closes relative to ICE cars, and suddenly the benefits of lower fuel costs and less maintenance cost are more accessible to the average consumer, not merely the already affluent and technophiles which flock to $80k+ Teslas.


As I polish this up, I notice that Jalop staffer Mack Hogan has already summarized some of my points and additional ones regarding the environmental negative of crushing cars in this—much more professional—piece.


Balls. Screw it, I’m still posting this. Thoughts?

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