Ban Fossil Fuel Vehicles

This headline was in the Globe and Mail today:

General Motors to shut down Oshawa plant in global restructuring.

Very bad news for the Canadian automotive industry. Many Canadians are blaming their government: an uncompetitive taxation system, high costs for energy and a burdensome regulatory environment.

Why is GM shutting down Oshawa? To focus on autonomous and zero-emission vehicles. And probably to relocate manufacturing activities from a higher cost country to a lower cost country.

It is too easy in North America to be isolated from what is happening around the world. For example, did you know that China announced a ban in 2017 on all production and new vehicle sales of gasoline and diesel by 2040?

And they are not alone.

Here is a current list of the bans that have been announced worldwide:

The auto industry is pouring billions into ramping up the production of electric vehicles in response to the bans that governments are imposing on gasoline and diesel vehicles. I’ve read estimates of roughly $100 billion with the expectation that 40 to 50 percent of all new production will be electric by 2040. Electric vehicles are less than 3 percent of the global market today. Here is one article about the upcoming changes to the automotive industry from an investor’s perspective.

Both the Canadian and U.S. governments have been rather silent on the banning of fossil fuel vehicles. There have been attempts by lobby groups to get the North American governments to impose bans at a national level. Even an online petition.

How possible would it be to pivot the automotive industry in 15 to 20 years? For most of the politicians ushering in these bans, they likely won’t be around to see them implemented. It’s also very difficult to predict how the technology will change over the next two decades. Likely these dates are soft dates intended to get an industry to focus on moving beyond conventional combustion engines.

I may well see a time when fossil fuel cars are no longer allowed to operate within large North American cities. It is already starting to happen in some cities in Europe.

Lorraine and I have not decided on our timing to change our coach. It seems, at least with what we have been seeing in our network of friends, that some owners of high-end motorhomes change their coaches frequently. As in every year or two. I suspect that within ten years, the decision to change a coach will be influenced by the actions of government on fossil fuels. The cost of diesel fuel may well become prohibitive and the RV industry will have to respond with a cost-effective alternative.

Regardless of whether you accept or deny climate change, fossil fuels appear to be on their way out. Perhaps even during my lifetime.

2 replies
  1. Van
    Van says:

    We obviously you have different friends. My friends do not change coaches that often. Most change only because they age out – not their coaches mind you, them! The largest expense ANY new luxury coach owner faces is NOT fuel, nor maintenance or even insurance – it’s depreciation by a HUGE margin! Some high-end coaches lose more in value the day their new owner drives them off the sales lot than they will use in fuel during their first TEN years of ownership (if kept that long)! We drive a Prius, our toad is a micro-sized Fiat 500 Pop and our sticks and bricks house has 9kw of solar panels. Those purchase decisions made economic sense. However unless you already have 9kw of solar on your roof, fully electric vehicles of any type will never make economic sense as long as gasoline is $1.97/gal [last week in Texas] with diesel not far behind. Even when fossil fuel was > twice that price, electric vehicles only sold thanks to hefty government tax incentives. Those subsidies where needed to help purchasers overlook electric vehicle limitations – crazy high prices, limited range and constant recharging hassles… WHEN an electric RV can travel the same 1,200 miles between refueling that my 2004 diesel pusher can, refuel in minutes from a small pump in the middle of nowhere and it costs the same or less than my dinosaur juiced model (without government subsidies), I’ll consider one. Until then, not a chance!
    Why would the worlds largest producer of oil, ban fossil fuels and mandate electric vehicles? Mandates and outright bans are a socialist thing that forces consumers into paying higher prices for ALL goods and services. Thankfully the US hasn’t slipped completely into that abyss… yet.

    Reply
    • Richard
      Richard says:

      We have friends that have wonderful older coaches. We have friends that bought new and intend to run their coaches for at least a decade. We have friends that replace their coaches somewhat frequently, say every five to seven years or so. And then we have friends that change their coaches every year or two, trading them in for high(er) end coaches. I did use the word “some owners” in our network of friends, not “all owners” 🙂 🙂

      There is clearly an agenda by many governments worldwide to transition away from fossil fuels. In Canada, carbon taxes will definitely force consumers to pay higher prices for all goods and services. It would not surprise me in the least to see a Canadian Liberal federal government introduce a ban on fossil fuels.

      Reply

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