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The competing car makers sell their EV cars at a loss as well. Credits will always remain a component of the EV car market, and that's good because otherwise th

by est31 6y ago

The competing car makers sell their EV cars at a loss as well. Credits will always remain a component of the EV car market, and that's good because otherwise the externality wouldn't be priced in.

jkhdigital 6y ago
You know, the funny thing is that the externality comes from the gasoline, not the car itself.
- est31 6y ago
  And indeed there are discussions to create a CO2 tax on gasoline. You can say that's more fair than a price on the car itself, as then it punishes frequent drivers more than people who drive less. In general though, your individual CO2 production doesn't matter that much, instead the population's emissions matter. And on a population level, you can create statistics about how many km each bought car will drive on average, and base the different car prices on that. Whether you want to punish frequent drivers or everyone who buys an ICE car is a political/social discussion. In general, a tax on gasoline is not helpful in getting people to switch if there is no EV car around they can switch to. In Germany, gasoline is already extremely heavily taxed, and still people drive a lot. Even in the current stage, where there are few EV cars compared to ICE cars, economics of scale still favour ICE cars, so there is still an effect in favour of EV cars. Maybe that's what such measures counteract?
totalZero 6y ago
You may not be thinking it through all the way. Every in-house EV that a company like GM produces can be considered as absorbing one regulatory credit that GM would otherwise have to buy in the open market (eg, from Tesla). The competing car makers won't have to buy Tesla's regulatory credits, even if their EVs are no more profitable than those of Tesla.
- est31 6y ago
  That's what I meant. Tesla is not the only company that can build EV cars. Eventually they have to compete. They have non traditional approaches to some things, and in that regard they might be able to build EV cars more cheaply than competitors, and it probably also helps that they have lots of experience now, but eventually the fact that the cars are electric won't be the killer feature any more.
  - totalZero 6y ago
    Well I certainly agree with this. Earlier you said that credits are always going to be a part of the market, and that's just not gonna be the case when all of Tesla's regulatory credit buyers make their own cars (and thus their own credits). To qualify that a bit, you may have the credits but you won't have credit trading.

by est31 6y ago

The competing car makers sell their EV cars at a loss as well. Credits will always remain a component of the EV car market, and that's good because otherwise the externality wouldn't be priced in.

jkhdigital 6y ago

You know, the funny thing is that the externality comes from the gasoline, not the car itself.

est31 6y ago
And indeed there are discussions to create a CO2 tax on gasoline. You can say that's more fair than a price on the car itself, as then it punishes frequent drivers more than people who drive less. In general though, your individual CO2 production doesn't matter that much, instead the population's emissions matter. And on a population level, you can create statistics about how many km each bought car will drive on average, and base the different car prices on that. Whether you want to punish frequent drivers or everyone who buys an ICE car is a political/social discussion. In general, a tax on gasoline is not helpful in getting people to switch if there is no EV car around they can switch to. In Germany, gasoline is already extremely heavily taxed, and still people drive a lot. Even in the current stage, where there are few EV cars compared to ICE cars, economics of scale still favour ICE cars, so there is still an effect in favour of EV cars. Maybe that's what such measures counteract?

totalZero 6y ago

You may not be thinking it through all the way. Every in-house EV that a company like GM produces can be considered as absorbing one regulatory credit that GM would otherwise have to buy in the open market (eg, from Tesla). The competing car makers won't have to buy Tesla's regulatory credits, even if their EVs are no more profitable than those of Tesla.

est31 6y ago
That's what I meant. Tesla is not the only company that can build EV cars. Eventually they have to compete. They have non traditional approaches to some things, and in that regard they might be able to build EV cars more cheaply than competitors, and it probably also helps that they have lots of experience now, but eventually the fact that the cars are electric won't be the killer feature any more.
- totalZero 6y ago
  Well I certainly agree with this. Earlier you said that credits are always going to be a part of the market, and that's just not gonna be the case when all of Tesla's regulatory credit buyers make their own cars (and thus their own credits). To qualify that a bit, you may have the credits but you won't have credit trading.