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Volvo Commits Sepukku

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With gas cheaper than it has been in at least 50 years — strongly suggestive that there is plenty of it available and will be for some time to come — Volvo has announced its decision to build nothing but expensive plug-in hybrid and full-on electric cars beginning after the 2019 model year.

Cue the falling of rose petals.

“This announcement marks the end of the solely combustion engine-powered car,” saith Volvo’s CEO Hakan Samuelsson.”

No, it marks the end of sanity — and very possibly of Volvo as a manufacturer of cars. Well, as a manufacturer of cars that people can actually afford to buy or want to buy and which aren’t massively subsidized by the government — from the assembly line to the moment they drive off the dealer’s lot.

But why is Volvo — why is the industry — so hell-bent on replacing cars that work with those that do not?

Especially now?

With gas prices going down rather than up?

It is the height of the summer driving season — when gas usually costs the most — and prices remain stable at around $2.00 per gallon. People notice this — and shop accordingly. Trying to sell them a hybrid or electric car when gas is cheap is like trying to get a cellulitic fat girl voted in as Miss Universe (though that is probably coming, in the spirit of “diversity”).

Did you know that sales of the Toyota Prius — the only somewhat reasonably priced hybrid car currently on the market — are down? And that Toyota had to give up trying to sell the not-reasonably-priced plug-in version of the Prius?

This shouldn’t surprise anyone.

With gas at about $2.00 per gallon, spending $2,000 extra to buy a Prius ($23,475) vs. an otherwise similar but non-hybrid car like a base trim/four-cylinder Camry — which is actually a larger/nicer car than the Prius — does not make economic sense. It makes even less sense when you compare the cost of a Prius with the cost of something more directly comparable, such as a Corolla. You can buy one of those for $18,500 — which is $4,975 less than a Prius.

And about $15,000 less than the cost of the plug-in version of the Prius (RIP).

You will never recoup the initial cost in down-the-road savings unless gas prices at least double — which is there is no sign of them doing, almost certainly because the supply is known to be vast if not essentially limitless.

This is why gas is so cheap. It must be so.

If it were not so, gas would be very expensive — and growing more so every hour.

The price of a commodity for which there is a huge market does not go down when supply decreases — or when there is the expectation of an imminent decrease in supply. Think about this a moment.

If the Peak Oilers and electric car-pushers were right and “peak oil” was just around the corner — as they have been insisting for the past 50 years — the price of gasoline would be hyperinflating like a Weimar Deutschmark.

This axiom of economic obviousness, however, cannot be mentioned by any establishment media journalist who wishes to keep his job — for the obvious reason that it makes a laughingstock of the stampede toward hybrid and electric cars, as if they were the only possible way to keep the wheels turning.

Is it not hallucinatory?

The organs continue to grind, producing near saturation coverage of Our Electric Future — so as to create the impression of its inevitability. And thus, it is hoped, the actuality.

Meanwhile, laws are passed outlawing affordable, efficient — and yes, clean — internal combustion-engined cars in European countries and requiring the manufacture of plug-in hybrid and electric ones.

This, by the way, is the real reason for Volvo’s announcement.

Volvo may indeed be “committed” to an electrified future, but that commitment has a lot to do with the laws and regulations on the books and soon-to-be-coming. It is why BMW and Mercedes have also grafted plug-in hybrid systems to almost every car they sell and cynically warble in tune with Volvo about unsere electrische zukunft.

There are areas in Germany where it is verboten to drive a car that isn’t rolling on battery power.

If they want to sell any cars at all, they must be plug-in hybrids or electrics.

And legislating these things into mass-production is the only way they will ever be mass-produced. Because absent laws requiring their manufacture, people — for the most part — are not going to buy them.

Not when gas is $2 per gallon and they can buy a car that costs thousands less than a hybrid and tens of thousands less than a plug-in hybrid or electric car.

But economics — and practicality — be damned.

The Agenda is all that matters. The car industry must be transformed. In spite of the fact that gas is cheap and hybrids and electric cars aren’t selling.

Precisely because of those facts, in fact.

American Spectator

10 Comments on "Volvo Commits Sepukku"

  1. John Kintree on Mon, 10th Jul 2017 6:45 am 

    There is an excellent one hour YouTube video presentation by Tony Seba, given to Clean Energy Action in Boulder, CO on June 8, 2017, in which he describes the disruptive effects of improving price/performance of batteries, electric cars, autonomous vehicles, and solar energy.

  2. joe on Mon, 10th Jul 2017 7:27 am 

    It’s not that stupid. Volvo makes trucks, that market which is totally oil driven and does not suffer from silly things like emissions laws especially in ‘clean and green’ Europe, also that market is set to be the biggest growth area for transport fuel in the next decade. Electric cars make high margin and state aid (oops I meant subsidies) means it’s a garunteed income. Good PR+high marginal profit = $$$$$$

  3. Cloggie on Mon, 10th Jul 2017 7:59 am 

    If the Peak Oilers and electric car-pushers were right and “peak oil” was just around the corner — as they have been insisting for the past 50 years

    You can’t get your articles more short-sighted than this. The author probably never heard of Paris Accords or the Energy Policy of the EU. Price and money is all that matters:

    But economics — and practicality — be damned.

    Clean air, e-vehicle silence, not poluting your soil through fracking isn’t worth a dime.

    He probably never heard of ASPO2000 either, indicating that “peak oil” became a permanent residency in the public mind only since 2000. That “50 years” can only refer to insiders like Hubbert.

    He probably is not aware either that Volvo is a Chinese company now and that Chinese cities are suffocating in air polution, a prime driver for Volvo to switch to electric vehicles, independent of the price of oil.

    He is perhaps not aware either that countries like Norway and the Netherlands plan to faze out new petrol cars as of 2025.

  4. twocats on Mon, 10th Jul 2017 9:03 am 

    “He probably is not aware either that Volvo is a Chinese company now and that Chinese cities are suffocating in air polution,”

    good point Cloggie. in addition, having more electric in the mix will allow them to replace some imported oil with domestic coal.

  5. Sissyfuss on Mon, 10th Jul 2017 11:05 am 

    So Volvo is a Chinese company pushing EVs that will require more coal burning. What a world.

  6. John Kintree on Mon, 10th Jul 2017 1:45 pm 

    Solar electricity is now less expensive than coal fired electricity. The batteries in the cars take care of most of the variability of solar energy. The Chinese are building factories that will have several times the battery manufacturing capacity of Tesla’s Gigafactory.

    That’s all good. The shift from personally owned vehicles to community shared autonomous vehicles will make it even better.

    The one hour video at YouTube of Tony Seba giving a presentation on Clean Disruption is very illuminating.

  7. Outcast_Searcher on Mon, 10th Jul 2017 3:16 pm 

    The author is clueless, living in a fact free world on this issue.

    Initially, Volvo will mostly be selling hybrids.

    Recently Toyota and Honda announced new hybrids, the 2018 Camry, and 2017 Accord, respectively. Both are solid middle class cars, with solid middling performance and get about 50 MPG. That’s Prius class mileage. And they don’t cost much more than the regular I4 ICE’s, especially considering they’re roughly doubling the bas mileage vs. the ICE’s — at least in the city.

    So how, pray tell, is that “not working”? And the new hybrids last a LONG time before needing replacement batteries — to the extent of the life of the car for about 90% of new car buyers.

    The citation free, inaccurate “economics” discussion is typical for AGW denialism though. So the author deserves “congrats” on that.

  8. Apneaman on Mon, 10th Jul 2017 3:31 pm 

    Retarded analogy.

    Why would people from Sweden commit ritual Japanese suicide? I come from Swedish ancestors and I can tell you for a fact they kill themselves in a manner much slower than Sepuku. It’s called alcoholism.

  9. John Kintree on Mon, 10th Jul 2017 4:11 pm 

    As they say, making predictions is difficult, especially about the future. There is a chance, if we see an exponential increase in the sales of electric cars, compounded by a shift to shared, autonomous vehicles, the price of oil will be even lower within ten years. The demand for gasoline will still be dropping even at $1 per gallon.

    The stone age did not end because we ran out of stones.

  10. MrEnergyCzar on Tue, 11th Jul 2017 10:51 am 

    Volvo is committing to make only “hybrid” and plug-in cars (pure EV’s and plug-in hybrids). Huge difference from what the opening paragraph says.

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