Alternative energy and the Automobile Industry

[BCPVP]

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Mark,

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The profit motive works, if the electric car has a viable market someone will direct capital towards that cause.

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It does, as proven by the Rav 4 EV. Electric cars would be in production if the patents on the battery technology required to make them practical were not controlled by Chevron. Market failure.

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Lol @ the patent system as an example of a market failure.

[Case Closed]

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Did your liberal history teacher ever tell you about Pets.com? They had a better way to sell pet supplies than Petsmart, who ended up buying their business for fractions of a penny on the dollar.

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I don't see how this is relevant at all. I find the assumption that my teacher is a liberal based on a single anecdote that could give you zero insight into his political agenda rather comical.

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Businesses must make decsions under uncertainty and they exist to increase value for shareholders. They should not be mandated to save the world. Was the automobile mandated to rid the cities of horse dung? The profit motive works, if the electric car has a viable market someone will direct capital towards that cause. The fact that GM does not should only be of concern to shareholders.

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Again, you don't seem to understand what I am saying. I'll try numerating my points.
1. The market works
2. GM Had an opportunity to take part in a burgeoning market
3. GM decided that it would not be profitable to enter the electric car market in spite of what appeared to be a market they could make profit off of.
4. Other companies picked up where GM left off...good for them.

This is not about how GM should have been happy little hippies and sacrificed profit to save the world. This is about how GM made a mistake. It is no matter though, their loss is another company's gain. So goes the market.

[Luxoris]

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Mark,

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The profit motive works, if the electric car has a viable market someone will direct capital towards that cause.

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It does, as proven by the Rav 4 EV. Electric cars would be in production if the patents on the battery technology required to make them practical were not controlled by Chevron. Market failure.

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We have a Department of Justice that has gone after many company's on anti trust grounds. Do you think Chevron has cornered the electric battery market and squashed it so they can sell more oil? If this is the case then I believe this would be an anti trust violation and you should report it to the DOJ.

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They have not 'cornered the market', they're sitting on patents for a specific type of battery that would make electric vehicles practical. This has nothing to do with anti-trust laws afaik.

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My understanding is that the Chevron patents are for precisely the technology that proved to be impractical for in the EV-1. Ovonics, the originator of the patents that Chevron bought, has largeley been a failure in the commercial market and turned to marketing to industrial companies that could benefit from tax incentives for green technology. Without those additional incentives the technology isn't cost effective.

[Jamougha]

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Mark,

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The profit motive works, if the electric car has a viable market someone will direct capital towards that cause.

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It does, as proven by the Rav 4 EV. Electric cars would be in production if the patents on the battery technology required to make them practical were not controlled by Chevron. Market failure.

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Lol @ the patent system as an example of a market failure.

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I don't consider the patent system as an example of market failure. The patent system is generally very useful. I consider this specific situation to be an example of market failure.

Or perhaps you are implying that without the government there would be no enforcement of patents. That's probably true but another discussion entirely.

[BCPVP]

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3. GM decided that it would not be profitable to enter the electric car market in spite of what appeared to be a market they could make profit off of.

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On what do you base this?

[BCPVP]

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I don't consider the patent system as an example of market failure...I consider this specific situation to be an example of market failure.

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This example is not an example of a market failure; it's an example of a government failure. The market doesn't run or enforce the patent system and any advantage taken of it by companies is the fault of the government for instituting and maintaining it. That anyone could consider it a market failure when a system that wasn't created by the market, isn't maintained through force by the market and wouldn't exist in a free market blows my mind.

[Case Closed]

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3. GM decided that it would not be profitable to enter the electric car market in spite of what appeared to be a market they could make profit off of.

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On what do you base this?

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I base this on just my observations. Which I am sure could be way off. It just seemed like they had ample reason to go forth with this product. Or at the very least sell the available models to people. The technology was growing at a very fast rate and still is today. When they made the car available to lease they only had a limited number and they received tons of requests to lease the car without a reasonable marketing plan. Also another positive for this car was that they had marque celebrities going around giving free endorsements of their automobile. It seemed as though things were set up for possible success. Although I would be willing to concede this point if more solid information was available that said GM had no shot at making a profit with this car.

[Luxoris]

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3. GM decided that it would not be profitable to enter the electric car market in spite of what appeared to be a market they could make profit off of.

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On what do you base this?

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Proof? Shouldn't it be obvious that GM management wouldn't want to p-off their good buddies in the oil business so they will pass on increasing their own share values? Just like Chevron is so single-minded in their management of a business that is supposed to be headed into decline would eschew efficient and profitable battery technologies that they own?

Its as clear as reading the lifeline on your hands for when you're next baby is going to be born.

[Jamougha]

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I don't consider the patent system as an example of market failure...I consider this specific situation to be an example of market failure.

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This example is not an example of a market failure; it's an example of a government failure. The market doesn't run or enforce the patent system and any advantage taken of it by companies is the fault of the government for instituting and maintaining it. That anyone could consider it a market failure when a system that wasn't created by the market, isn't maintained through force by the market and wouldn't exist in a free market blows my mind.

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I'm sorry, I was just basing my comment on the economic definition of market failure.

[ikestoys]

As someone who has their dad actually working on hybrids in the automobile industry, I find this argument hilarious. Ford, GM and Chrysler are scrambling to make more efficient and economical cars, if an viable electric car (or whatever kind of alt fuel car) existed, they'd be slitting throats for it.