[sustran] Re: MMRDA will file PIL to block Tata's Rs1 lakh car

[Walter Hook]

Ok, fair enough, there are no doubt social externalities related to the
production of cars that are not internalized in the cost of the car. 

There certainly is a justification for charging licensing fees and vehicle
procurement taxes, and there are other ways to internalize these costs. 

But a cheap car is no more likely than an expensive car to have production
externalities, so again the justification of a ban on the car because it is
cheap is very weak. 



-----Original Message-----
From: sustran-discuss-bounces+whook=itdp.org at list.jca.apc.org
[mailto:sustran-discuss-bounces+whook=itdp.org at list.jca.apc.org] On Behalf
Of Lee Schipper
Sent: Wednesday, July 11, 2007 2:43 PM
To: 'Global 'South' Sustainable Transport'; lwright at vivacities.org
Subject: [sustran] Re: MMRDA will file PIL to block Tata's Rs1 lakh car

I think I disagree with Lloyd's number-- a rule of thumb is about 10% of the
lifetime energy
of car goes for the car, 5% for the refined fuel and the rest to run the
car.  The calculation is obviously very sensitive to the fuel economy of the
car (which is roughly inverse to the weight, and therefore to the amount of
energy required to create all that weight) as well as to the lifetime of the
car expressed in total km run.
Perhaps the German EPA has different assumptions, but ones I poured over
once with both Volvo and VW (in 1997) came out with numbers like those I
quoted above. 

For the US, cars are 35% heavier than those in Europe, but they are run 35%
more and use 35% more fuel/km, and they are not forced-retired as some
countries do when cars get old and phunky. Hence  the relationship Lloyd
expressed -- a smaller share of lifetime emissions is bound up in the car in
the US than in Europe -- is true

At the end of the day it comes down to what the car is made of, and whether
the masses of aluminium and steel are made mostly with coal (like in
Australia, where the electricity for the Aluminium is coal-fired), natural
gas, or some combination of those two plus hydro and nuclear (the Swedish
case). IF steel or Al is imported that makes it even more complicated.

My best guess is more like 15% for the US and 20% of a much smaller total
number for Europe.

>>> "Lloyd Wright" <lwright at vivacities.org> 7/11/2007 1:31 PM >>>
Well, there are some environmental issues related to car OWNERSHIP.
>From a CO2 standpoint, about 22% (US) to 30% (Europe) of the total
emissions emanate not from usage but from manufacturing and disposal.
There is also significant solid waste produced in manufacturing and
disposal.  The German EPA did an interesting study a few years back
tracing the solid waste of car manufacturing from a cradle to grave
analysis.  To manufacture a one metric ton vehicle, about 20 metric tons
of waste is produced (most of which is mining tailings from iron ore
processing), and most of this waste is incurred in developing nations.
 
There are also a fair number of studies suggesting that auto
manufacturing can be an inefficient economic transaction, which in turn
has opportunity costs affecting investments elsewhere (e.g. nutrition,
education, and healthcare).  The automated nature of auto manufacturing
today means it has a very poor employment multiplier when compared to
alternative uses of capital.
 
Bottom line...we should also be a bit concerned about OWNERSHIP,
although I certainly agree that USE is a serious issue.

-----Original Message-----
From: sustran-discuss-bounces+lwright=vivacities.org at list.jca.apc.org 
[mailto:sustran-discuss-bounces+lwright=vivacities.org at list.jca.apc.org] 
On Behalf Of Walter Hook
Sent: Wednesday, July 11, 2007 11:34 AM
To: 'Global 'South' Sustainable Transport'
Subject: [sustran] Re: MMRDA will file PIL to block Tata's Rs1 lakh car



Carlos, 

 

You are way off.  Car OWNERSHIP causes relatively few social problems,
and a lot of social benefits.  The social costs are related to car USE
and overuse, and these costs are not uniform but vary greatly depending
on location.  In some locations, more people are exposed to air
pollution, and in some locations the use of the car will create
congestion whereas in other locations it will not.  It is therefore more
socially optimal to regulate car USE than to regulate its ownership.  

 

If the cheap car generates more pollution than other cars, it could
certainly be banned on those grounds.  But a cheap car generates no more
congestion than an expensive car.  

 

Otherwise, banning cheap cars just creates a cash transfer from
consumers to the producers of more expensive cars, and yields no public
revenue for public investments. 

It may have some marginal congestion benefits, but these congestion
benefits will be poorly targeted and will be therefore far lower than
the aggregate social benefits of a congestion charge.  In poor areas,
where there is likely to be the least congestion, people will be the
most likely to be priced out of the auto market, facing higher costs and
bringing little congestion relief, while in wealthy areas, where there
is likely to be the worst congestion, people will simply switch to more
expensive cars and again there will be no congestion relief. 

 

If the purpose of the policy is congestion relief, it is likely to be a
far less effective policy than a better targeted congestion charge.  If
the purpose is to generate revenues for public investments, it does no
good either. 

 

With a congestion charge, a rich person or a moderate income person can
prioritize their trips into the city center and only make them when the
trip is really worth the social cost of 8 pounds (or whatever the charge
is).  This is a much more flexible and fair policy than an alternative
license plate scheme which the rich can always get around by buying a
second car, or a ban on cheap cars, which the rich can always get around
by buying an expensive car.  

 

Best

Walter 

 

of people-centred, equitable and sustainable transport with a focus on
developing countries (the 'Global South'). 

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