ELECTRIC VEHICLES CHARGING AHEAD

 Electricity is really just organized lightning. ~ George Carlin  

Watt have we been waiting for? Will the era of electrified transportation finally arrive, after being promoted assiduously for years without much to show for it on roadways? Electric vehicles (EVs), nevertheless, have contributed to Elon Musk becoming the world’s wealthiest person.

It seems from recent events that EVs will at some point get much more numerous. Alas, the EV boulevard to nirvana still has several potholes. EV market-makers need to organize their lightning, so it’s not just a “storm” in the San Francisco Bay Area, but everywhere in America.

San Francisco amid a lightning storm, August 2020.

First, the encouraging news. Mary Barra, chief executive of General Motors (GM), announced on January 28 that GM will eliminate production of gasoline- and diesel-fueled light-duty cars, vans and SUVs by 2035 and become carbon-neutral by 2040. Her statement represents a fundamental U-turn and shift for GM, who upset environmentalists when it agreed with #45s reductions of auto fuel-efficiency rules in 2019.

GM is now “all in” and charging ahead with EVs. It expects to invest $27 billion in EVs and associated products through 2025 and will eventually sell about 30 kinds of EVs. The media has characterized GM’s announcement as game-changing. It may be, although the event’s timing leads some to believe it’s as much a political message as a corporate one, coming a week after President Biden’s inauguration.

GM is not alone. Volkswagen, our planet’s largest vehicle manufacturer, is expecting to introduce nearly 70 new EVs in the next decade. Other manufacturers like Toyota, Ford and Volvo also have made big EV investments. The EV market champion remains Tesla Motors, which produces nothing but EVs. Tesla has dominated the market ever since it began selling cars in 2008. Its EV market share hovers around 80%. Nice work, Elon.

Taking a macro view of the US vehicle market, GM along with its traditional competitors like Ford, Fiat Chrysler, Toyota and Volkswagen have been facing a much-changed market for some time. The recent public voltage about how EVs will reshape transportation has been asserted for years without much actual confirmation.

The real upheaval in the auto business has not been EVs slender gains. It’s been customers’ lane-shifting away from wanting traditional cars to buying light trucks, which include not only pickups but SUVs and minivans.

Very, very few car purchasers have been buying Buick sedans, like my grandfather actually did way back in the day. US and Canadian customers’ overwhelming preference is for 4-wheels that are not connected to a traditional sedan. This big shift has progressed since the mid-1990s.

Customers have strongly favored SUVs and pickups, as shown below. Last year, at least 90% of every major domestic car manufacturer’s sales were light trucks, which include SUVs and minivans.

Light Truck* Share of US Vehicles by Manufacturer, 2020 

Light Truck Sales /  Manufacturer	GM	Ford	Fiat Chrysler	Total US
By vehicles sold	90%	91%	91%	76%
By retail value	92%	94%	91%	81%

 Source: Bloomberg Businessweek. *Includes SUVs & Minivans   

SouFor this reason, the sun has already set for sedans’ production at GM and mostly at Ford. Say goodbye to GM’s Chevy Impala and Ford’s Fusion, along with 24 other sedans these two firms made. Chrysler-Dodge will continue making its two sedan types. Not to worry sports fans, thankfully the Mustang, Corvette and Rolls Royce Dawn (starting at $356,500) will still be available.

The 12-year-old US market for EVs remains a thin one. EV sales represent just 1.2% of 2020 US new vehicle sales. GM and other veteran car manufacturers who are placing large gambles on EVs clearly want to change that, as does Tesla.

Throughout EV market history, massive optimism about future growth has far outweighed actual EVs sales. A recent forecast stated that EV annual sales in 2030 will exceed 3.5 million vehicles, which is more than 20 times as many EVs sold last year.

This might happen, but such giant changes in customers’ car purchasing seems founded in fantasyland. What’s very clear is it won’t occur at all without an enormous push via federal, state and local government intervention and a revolution in consumers’ predilections for EVs.

Large increases in EV sales have already been promoted by Dems in the form of significant subsidies that began for the 2010 model year. Subsidies remain vital because EVs cost more for customers to buy than comparable gas-powered vehicles. Many potential purchasers are sensitive to the level of such EV subsidies. When the State of Georgia and Hong Kong eliminated their EV subsidies, sales crashed.

Purchasers of eligible EVs may now receive an IRS tax credit from $2,500 to $7,000. These federal tax credits are available if the manufacturer has not yet sold 200,000 of the EV model. Currently both new Tesla and GM’s EVs cannot qualify because they’ve sold more than the maximum allowed. Such subsidy phase-out is a good idea, that also has been used for solar panels, so they don’t become eternal.

States also offer subsidies, including California, which has been on the forefront of the EV market. By itself, California accounts for 48% of all EVs sold nationwide. The SF Bay Area has surged to having the highest market share of EVs in the nation.

The California Air Resources Board (CARB), offers up to $7,000 in EV rebates for the purchase or lease of new, eligible EV vehicles. The CARB also has mandated that zero-emission vehicles (ZEVs) like EVs achieve specified minimum market shares in the state’s light-vehicle sales.

These mandates began in 1990, none of which were met nor could have been attained by manufacturers at that point. At best, the mandates  were aspirational and took no account of existing customers’ preferences. They did push needed EV technology development, meaning battery performance. For a long time, the CARB did nothing to enhance EV “infrastructure” in the state.

The CARB’s current ZEV mandate, stated in 2003, is for ZEVs to attain a 10% market share. Most recently, the EV share of cars sold in California is 7.9%. It’s the largest of any state and still below the required CARB mandate, 17 years later. EVs remain a big policy priority for California, but not for Californians.

Eight years ago, Governor Jerry Brown signed an executive order that set a long-term target of having 1.5 million ZEVs on California’s roadways by 2025. By December 2019, 670,000 EVs had been cumulatively sold in the Golden State.

In addition, Governor Gavin Newsom announced last September that California will disallow the sale of gasoline-powered cars by 2035. Take that, you heathens who keep buying non-EVs.

Not to be left behind, the Berkeley city Council is considering how to ban the sale of new gasoline-powered vehicles by 2027, eight years ahead of the rest of California. Prematurely instituting such a ban could reduce the city’s tax revenues by at least 10%. Berkeley's business tax revenues have already shrunk 13.2% due to Covid and it faces a $40M budget deficit. Do the councilmembers absurdly think their non-EV car-buying residents won’t simply drive a couple of miles to purchase such autos in Oakland or elsewhere. Perhaps the Council plans to pull up its drawbridges seven years from now.

President Biden has already signed an executive order that calls for the federal fleet of about 645,000 vehicles, principally of the US Postal Service, to be converted to electric power. He has also vowed to expand charging stations for EVs, revise and extend EV tax credits and tighten fuel economy standards for gas-powered vehicles. It’s doubtful that he will use reconciliation to legislate these actions, so when this becomes law is unknown.  

Such actions and incentives will help, but immense changes in the nation’s vehicle fleet will not be possible without vastly more consumers choosing to buy EVs. Mainstreaming our EV market will require convincing “regular people” like the Katharine and Jack Cooper family, who have 2 young, mini Coopers, to buy an EV, and not feel like they’re being forced to. In the main, pro-active EV policy makers have mostly forgotten about folks like the Coopers. Instead, they’ve principally dealt with suppliers of EVs, hoping that more supplied EVs will in turn create more demand for them. Such thinking was popular among 19th-century economists, but not since then.

The sooner Katharine and Jack become convinced about EVs, the better for our environment. People like the Coopers represent more typical, and far more numerous, car purchasers than many of the privileged folks, to use a currently-popular term, who have bought most EVs so far.

Changing the Cooper’s long-established automobile purchase habits so they actually consider buying an EV will require coordinated government influence. It will be marathon rather than a dash. To date federal and state EV policies have been sadly unidimensional, offering mainly financial incentives, which are useful but not sufficient to radically electrify transportation. Typical car-buyers’ behavior will need to change appreciably, if EVs are to become mainstream.

What’s needed? First, capable, moderately-priced EVs must be available in the marketplace. This will happen over the coming years. Thanks Elon and now Mary.

Second, these vehicles must be comparable with non-EV vehicles, regarding cost, range, performance and supporting infrastructure, especially having a sufficient number of standardized, fast-charging stations across the US, including at multi-tenet buildings.

Nationally, there are about 115,000 gas stations and only 25,000 EV charging stations. Sadly, EV infrastructure is lagging due to an electric chicken-and-egg problem. Increasing the number of charging stations will be costly with so few EVs amping along our roads, but without more fast-charging stations, less people will be interested in buying/leasing an EV. A typical Level-3 commercial, fast-charging station can cost $50,000, taking about an hour for a full charge. A Tesla “supercharge” facility can cost five times as much.

Successfully creating an integrated, electrified transport system is ultimately up to us consumers. Manufacturers like GM, Ford, Volvo, Tesla and others will contribute by offering an expanded variety of attractive, high-value EVs. But there’ll not be any EV tangoing in Paris Kentucky, Paris Oregon or Paris Wisconsin without folks like the Coopers becoming satisfied, repeat EV owners. As Hamlet said, there’s the rub.

 

COVID VACCINE DISTRIBUTION IS A MESS

 Everyone has a plan until I punch them in the face. ~ Andrew Cuomo     

It is no surprise that the distribution of Covid vaccines has proven challenging. Getting precious vaccine into 330 million Americans’ arms was never going to be a slam dunk, given the fractionalized nature of our healthcare system.

We should not downplay or forget the astonishing success of the development of these vaccines. The vaccines were created with technological brilliance at near light-speed –with $18.5 billion of federal government support. But the vaccines’ distribution is another matter.

Supply shortages of the Covid vaccines have been expected and present since Day 0 of their distribution. This scarcity have been mostly sidestepped by politicians. They rarely couch their Covid pronouncements with clarity about how long increases in vaccine supply may happen, except to make generic (and optimistic) statements about the future.

With my medium-priority status as an ancient diabetic in mid-December I estimated there would be 124 miles of people ahead of me in Alameda County’s line to get the vaccine. That translated into my being in back of 2,954 miles of folks in California’s line. While proverbially waiting in either line, I needed to remember at least to bring a camp chair and water.

Forecasts of vaccine availability have always been colossally optimistic. Last Fall, Operation Warp Speed stated there would be 300 million (M) vaccine doses available in the US by the end of 2020. By the mid-December, the CDC said it expected between 30-45M doses by yearend. In fact, only 1,008,025 doses were administered by last Christmas. Should we believe updated dosage forecasts that are stated by “experts”? I’d advise against it.

At this point, vaccine supply isn’t expected to increase at all before two months from now for the already-approved vaccines. Why? Because additional production capacity is currently unavailable.

If all the now-expected supply were used, the US could average over 2M shots per day, but state and local vaccination centers have failed to manage and use the current flow of vaccine, let alone more. So why are governors adding even more “prioritized” people to the vaccine-eligible lines with no additional supply until April?

Some relief will come once the Johnson & Johnson single-dose vaccine gets FDA emergency use approval. If expeditiously approved, the J&J vaccine might start to be available in early March according to the experts. J&J has agreed to deliver 100 million doses to the US by the end of June, assuming smooth sailing. Are you holding your breath?

Covid vaccine distribution has been a calamity in California and elsewhere. Fundamentally, the vaccines’ delivery system is founded on a conflict between the inclusive logic of having ever-more people become safer by getting fully inoculated – something politicians and everyone else wants to happen the day before yesterday – and the selective logic arising from shortages of vaccines because at any point in time there’s a fixed, inflexible supply that is far less than the public’s demand.

To reduce the shortage, vaccines have been rationed, requiring some people to be non-prioritized and thus having to wait. No public official ever uses the term rationing to describe the situation because of its fraught connotations. But that’s what is behind the CDC’s and each state’s tiers and sub-tiers. Unsurprisingly, the alluring artform for some of securing “unfair priority” to jump ahead in the line is itself reaching epidemic proportions.

As of February 1, California has vaccinated 7.2% of its residents with at least one dose, 1.5% with two doses, and utilized just 61% of all doses delivered. California ranks 38th highest of all the states for doses utilized. Each of these percentages is below the mediocre US averages. Nevertheless, thank goodness vaccination rates are slowly rising.

State politicians have established “vaccine delivery systems” that involve many interdependent moving parts among multiple agencies/institutions grating together, in which every piece needs to work rapidly, competently and seamlessly for success to occur. It hasn’t.

This week Dr. Anthony Fauci, now President Biden’s chief medical advisor, acknowledged this very problem, “You cannot give a definite answer [about when the Covid vaccine system will return us to “normal”] when you have so many moving parts.”

I’m reminded about such challenges in keeping our multi-faceted Covid vaccination systems working by this image of Charlie Chaplin in his renowned 1936 Modern Times movie. So many gears, so many parts grinding on each other that have to be kept working flawlessly together. No wonder he and we are exhausted.

Charlie Chaplin enjoying Modern Times.

California’s vaccine distribution system has been changing rapidly, which adds yet another fateful, often confusing influence on getting this essential task done timely and effectively. If it’s Wednesday, do I keep unsuccessfully calling an 800 number, or do I use the newly-introduced but error 408-laden website? The systems’ shortcomings have resulted in every relevant party pointing fingers, at others.

Gov. Newsom’s approach seems to pay only slight attention to the vaccines’ omnipresent shortages that everyone is facing despite California’s utilizing only 61% of delivered vaccines. His approach that emphasizes inclusive vaccinations has increased the demand for the vaccine. Not the supply.

Gov. Newsom announced January 13 that the state was “significantly increasing our efforts to get these vaccines administered, get them out of freezers and get them into people’s arms” by increasing the number of people eligible to receive shots to everyone 65 and over. Except sufficient vaccines aren’t available for an additional 6 ½ M elder Californians.

And the governor knows every person demanding a shot is a voter, be they a healthcare worker, elder, school teacher, parent, diabetic, firefighter, meat processing plant worker, lettuce picker, or grocery worker – virtually all of whom consider themselves “essential” in some manner.

Thus, the governor’s system has all too often worsened the situation by increasing the number of “prioritized” people who qualify for getting the vaccines, without a concomitant boost in supply, over which he has no control.

Individual states cannot directly contract with vaccine suppliers, only the federal government is allowed to. Thus, exhortations by governors like New York’s Andrew Cuomo about ordering their own vaccines have, at best, only fleeting PR value, but no legal or practical consequence.

Pfizer’s and Moderna’s production facilities have been running at full-tilt 100% capacity. As mentioned before, the intricate vaccine production process cannot change that rapidly, even if governors like Mr. Newsom somehow expect it to with the flick of a few words.

Thus, the lines get ever-longer; the public’s expectations are rarely met and people understandably get more upset and frustrated. Hence, the emergence of a misbegotten campaign to recall Newsom, promoted by the ever-endangered species, California Republicana.

Perhaps this political action is part of why Gov. Newsom last week again changed his vaccine distribution system. This time more fundamentally. Until last week, the governor’s delivery system revolved around the state’s Public Health Departments (PHDs) who had responsibility for allocating the vaccines across the State, county by county.

He shocked California’s vaccine delivery system by removing the PHDs. Critics said the PHD-based system was a piecemeal patchwork of confusion. The authority of the PHDs should have been sidelined long ago in favor of larger-scale healthcare providers who are far more experienced dealing with customers, and already have the systems to do so.

The governor’s new vaccine management-distribution system will be run by Blue Shield of California, with assistance from Kaiser Permanente, two of the largest healthcare providers who together serve more than 10M people in the state.

The PHDs have been challenged and stretched by their vaccine responsibility even before they officially started Covid vaccination management in mid-December. For years PHDs have been under-budgeted, understaffed and now they’ve became overwhelmed, which has led to their ineffectiveness. Their distribution efforts have been faulted for inflexibility, spotty data collection and a lack of statewide coordination among the 61 local health jurisdictions with regard to eligibility requirements.

One person familiar with California’s PHD-based system stated, “In short, there is no clear and easy way to tell people when it was their turn and where to go when it was.” Another knowledgeable observer said the bar for Blue Shield’s and Kaiser’s success is pretty low; “The whole thing has been managed so disastrously.”

My personal example: on January 14 I completed the online Alameda County Health Care Services’ Resident Vaccine Notification Form and submitted it – apparently to neverland. Since then, I have never received any notifications, even from Tinker Bell, about my status. On my own, I was vaccinated at Kaiser on January 19 via a phone call to Kaiser that included a 2.5 hour wait to get an appointment. Let’s hope my second dose isn’t delayed.

New York state has just made changes in its vaccine management system, similar to California for similar reasons. New York ranks 24th highest of all the states for doses utilized, at 65.7%.

After New York’s vaccine rollout became problematic and fewer available doses were actually being administered, Gov. Cuomo declined to adopt plans previously developed by the State Department of Health and local health departments. Recently he became more displeased with local public authorities’ and public hospitals’ poor performance, calling the PHDs’ operations excessively rigid. The magnitude of the pandemic had swamped New York’s public health planning efforts.

Finally, the governor said he punched the PHDs’ plans in the face, using a cheekbone-close adaptation of the famous Mike Tyson quote[1]. Late last week Gov. Cuomo announced that private hospitals now will be “hubs” for vaccine dispersal throughout the state, not PHDs.

Meanwhile back in Washington, President Biden is changing lots about #45s plebeian Covid plans. He has ordered FEMA personnel and active-duty soldiers to become directly involved with vaccine distribution. They will operate large, federally-supported vaccine centers in several states including Arizona, Nevada, Texas and Washington.

Additionally, the president’s Department of Homeland Security recommends that undocumented immigrants should be vaccinated, together perhaps with incarcerated people that others insist should be inoculated ASAP. If large numbers of such folks received dosages before “ordinary people,” it isn’t hard to imagine how badly the public might react. Such are the judgements #46 and other authorities now face.

So, here’s an FYI message to Charlie Chaplin (see above). In order to improve our Covid vaccination system, the president is adding additional large gears to the nation’s already hugely complex vaccine machinery. I’m sure you understand. Perhaps hope springs eternal with further intricacy. Let’s see how it all works, keeping every finger crossed, with uniformed and non-uniformed federal personnel now swiftly meshing with the other thousands who’ve been engaged in this herculean task for far longer. Onward towards herd immunity.

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[1] Mike Tyson said “Everybody has a plan until they get punched in the mouth,” in response to a reporter's question about whether he was worried about Evander Holyfield's fight plan before their 1996 championship fight. It turns out Mike got punched and lost the fight.