Will Obama Force Consumers To Buy Electric Cars They Don't Want?

June 4, 2015

INVESTOR'S BUSINESS DAILY
Posted with permission from Investor's Business Daily

Central Planning: Recent sales data show that consumers don't want electric cars. Too bad, since President Obama has put in place regulations that will effectively force the public to buy them in the not-too-distant future.
Yesterday IBD reported that electric and hybrid sales, combined, made up a tiny 2.8% of the market in the first five months of this year, down from a 2013 peak of 3.7%.
And even as May sales exploded, sales of pure electric cars went nowhere. In May, the Nissan Leaf, Chevy Volt, Toyota Prius PHV and Tesla Model S sold a combined total of 2,831 plug-ins.
For perspective, Honda sold more than 6,300 of its new HR-V crossover in just two weeks.
And these pitiful electric-car sales, mind you, come despite the very generous $7,500 federal tax credit, along with various state incentives — Illinois offers rebates up to $4,000.
"Hybrids and electrics are in less demand — even from existing alt-fuel car owners," IBD's Donna Howell notes. She also cites a survey showing just 3% of consumers say they'd prefer an electric car to a traditional gasoline-powered one. And while 24% say they'd consider a hybrid, that's down from 31% in February.
The problem is that Obama has implemented federal fuel economy standards that will upend these consumer preferences.
In just 10 years' time, the combined average fuel economy for all the cars and light trucks a company sells — from compacts to SUVs — will have to be 54.5 miles per gallon. Right now, actual sales average little more than 31 mpg.
Even small hybrids will struggle to meet that efficiency goal. The most efficient hybrid today — Toyota Prius hybrid — gets 50 mpg.
Unless a miracle happens or the new fuel economy mandate is dumped, it's hard to see what alternative carmakers will have other than to force feed plug-in cars to consumers who clearly don't want them.