## CEO of AutoNation “Looking Forward” to Selling Plug-In Hybrids; Calls for Increase in Gas Taxes

##### 13 September 2006

In an opinion piece published in the Fort Lauderdale Sun-Sentinel, Mike Jackson, the Chairman and CEO of AutoNation, makes a case for plug-in hybrids.

AutoNation is the nation’s largest auto dealership group with 350 new vehicle dealers in more than 15 states. Its 2005 revenues were $19.2 billion. Jackson believes that the plug-in hybrid will shatter the discrepancy between stated consumer interest in hybrids and actual sales. That brings us to what I believe will be one of the technologies that ultimately will address America’s addiction to oil: the plug-in hybrid. Next-generation batteries are significantly more powerful and can tolerate discharging and charging much more forgivingly than earlier versions. And that opens up the possibility of creating a vehicle that will deliver genuine benefits to consumers and society. Consider an all-electric mode that has a 50-mile range before the gasoline engine kicks in. A vehicle that gets the equivalent of 100 mpg; can be fully recharged at night when excess energy capacity is available; relies on electricity produced in clean, safe domestic power plants; and delivers all the performance and comfort of a traditional gasoline-powered car without the damaging emissions or dangerous geopolitics. That is a vehicle that I believe the American consumer will not just consider, but buy. We look forward to selling it. —Mike Jackson At the Reuters Autos Summit in Detroit, Jackson said that the United States should raise taxes on gasoline to encourage the development of more fuel-efficient technologies. We’re at a tipping point here. We have to do something to favor the new technologies and send a message to American consumers that gasoline prices are going to be systematically higher. A gas tax is a statement from the government that this is an issue of national security and we’re going to do something about it. —Mike Jackson (A hat-tip to Felix Kramer!) ### Comments Feels Good (not cars) to have Mr. Johnson on board the PHEV train. I fully agree with him that revenues from a carbon gas tax could be used to accellerate battery and PHEV development. My new home garage (by early 2007) will have a 120/240 VAC, 30 Amps outlets + 40 Amps electronic timer (275 USD for labour and materials) for PHEV/EV overnight charging. This type of outlet + timer should become a national standard. Retrofits are possible but may cost much more. While I agree that plug in hybrids are currently the way to go (and can't wait to buy one), I disagree that raising taxes is the way to get there. No politician will vote for raising the gas tax, they'd be out of office at the next election for sure. So if they really want to find money to fund developments of PHEV's then they'd have to look elsewhere. By doing that it defeats the purpose of a higher gas tax to begin with. Let the free market work. PHEV's make sense, the consumer can figure that out. Dave, the consumer will not figure it out until it's too late. I have come to the conclusion that the general public doesn't focus on the future, they just complain about high gas prices when they go up. I think we need something like raising taxes on fuel to help people think about the future. Besides, the benefits of raising taxes would be two fold if the revenue was used for increasing efficiency/alternative fuels. The American public has NO memory. This drop in fuel cost will (a) appease the voting public into making the same mistakes twice, (b) send them out to purchase that Hummer that they always wanted. The problem with a higher tax is that it will be misused as most other forms of tax are. I like small cars & seriously want to give OPEC & the middle east the slip. To me it's as simple as national security. Got to revise the CAFE requirements on auto mfg. and eliminate the Flexfuel and Big business SUV loopholes. If you're going to tax anyone make it a big oil windfall tax. How about the federal government stop subsidizing intra-state roads and let the states pay for them? (The states could raise gas taxes, make them toll roads, whatever they decide.) That would free up lots of money in the federal budget for all sorts of new technologies. FYI C02? Eliminate the Flexfuel loophole? Force flexfuel down the auto company's throat. Have them leave out ONSTAR or the friggin ANTITHEFT system if they are short of money. TAX CARBON NOW. This is not my idea, but I think it is a great one. Raise the gasoline tax one penny per month, forever. This will gradually make gasoline more expensive, but it will not be a huge shock to the economy. Use the money to subsidize hybrids and mass transit. If plug in hybrids become common the demand for gasoline will drop significantly and hence the price. When the price drops people will go back to wanting big, inefficient automobiles. We need to consider a floating tax rate that keeps gasoline near a constant price so that hybrids, ethonal, etc remain cost competative. Otherwise, the price of gas will drop and we start the whole cycle of low mpg automobiles driving increasing demand driving increasing prices all over again. A floating tax rate will provide the price stability needed to allow new technologies to expand. Using taxes for social engineering, as many here propose, is wrong. It is not the goverment's job to manipulate gasoline demand via regressive fuel taxation. Period. End of story. I will vote out any congressmen who proposes it. I guarentee you that such a system would start looking for other sources of revenue if it does reduce gasoline demand, and thus revenue. There is nothing more permanent than a temporary government program. I have an idea. Why don't we all stop the effort of commenting and let a robot fill in these threads. It can go "Raise gas taxes." "Social engineering! Humbug!" [repeat] Then, after all the robotic human commenters leave (since their "jobs" have now been taken), people with something original and useful to say can repopulate these threads. John, The flexfuel loophole (overexaggerated MPG credit for flexfuel vehicles, e.g. Yukon=33 mpg) has enabled GM and Ford to save hundreds of millions of dollars in CAFE penalties, and building more fuel efficient vehicles http://trucks.autoblog.com/2006/06/14/thomas-friedman-talks-back-to-gm/ http://www.ucsusa.org/clean_vehicles/cars_pickups_suvs/flex-fuel-vehicles.html if everyone plugs in a car at night there won't be any "excess" electricity available and it will just continue to increase coal generation. charging an electric vehicle still requires alot of juice. it wouldn't take to many electric vehicles to wipeout a windfarm. i still believe the best long term solution would be a diesel hybrid with a much greater percentage of bio-diesel working towards a 100%. We already consume something like 2 TW's of electricity now and a mass exodus into EV's would have a detremental effect on electrical generation. we don't have the renewable generation capability to even begin to solve the problem. meant to write: The flexfuel loophole has enabled GM and Ford to save hundreds of millions of dollars in CAFE penalties, and allowed them to continue building fuel INefficient vehicles rb, guess a robot wouldn't have screwed that up I'm sympathetic to those who are against raising the sales tax on gasoline. I know the money will not be spent efficiently. On the other hand, if we consider this an issue of national security then the federal government must be involved to change the direction of the country, possibly on an emergency basis. We raise money to support armies to defend us. Why not raise taxes to take money away from those who are killing us? The nice thing about a tax is that it doesn't entail the creation of additional bureaucracies since the taxing mechanism is already in place. If we want to have something useful to do with that money, have it go to converting the armed forces to be powered by alternative energy sources. RB, If you don't like the threads here, why don't you go back to surfing porn? "If you don't like the threads here, why don't you go back to surfing porn?" Because naked pics of your wife are even more boring than reading robots like yourself. I'm not sure if it is as much about the tax itself as how it would be spent. Some may want pure bio-diesel, some 100% EV, some E85 etc etc. The debate would still rage on forever. Without having a clearly defined expected result. it's hard to say. Is it just about national security? Is it about an attempt at an improved environment? All the above? I don't like throwing good money after bad and we certainly have tendancy to do just that. I don't like jumping in with both feet without looking really hard first and i don't think we have accomplished that. re: taxes. Taxes are too low (see growth of US deficit & nat'l debt since W took office) to support gov't programs + war. We are funding wars on the backs of future generations, not asking anyone to sacrifice now. A stiff gasoline tax devoted to funding the 'war on terror' might have the salutary effect of making the average Joe & Jane think about the real costs of our policies and actions in the world. Reducing carbon emissions would be a significant side benefit. "Using taxes for social engineering, as many here propose, is wrong." So, you would vote against any politician that supported such intrusive social engineering programs as making mortgage interest deductible to promote home ownership? I'm sure no one wants anything that socialist. I guess VA benefits, gas tax allocation to highway building, zoning that promotes cars are all out of the question....(please note, this is irony). "I guarentee you that such a system would start looking for other sources of revenue if it does reduce gasoline demand, and thus revenue. " The simple solution is a matching reduction in low end income taxes, which is the only thing that would get it passsed, anyway. "There is nothing more permanent than a temporary government program." Like that temporary standing army for WWII, I suppose. Scott58: Current electricity consumption is only 440GW, and powering all 220M light duty vehicles would only raise electricity needs by 13%, because electric vehicles are 6x more efficient. ""Using taxes for social engineering, as many here propose, is wrong." Also time to get rid of reduced capital gains taxes, I guess. Surely no one wants to promote increased capital investment at the cost of some social engineering. Time to get rid of investment tax credits, and reduced inheritance taxes. Who could imagine such things in the purity of our political process? There is presently more than enough unused generating capacity during night to charge over 100 million electric vehicles. Even using dirty coal CO2 emissions would be less than half that used by gas and diesel fuel vehicles. One step at a time friends.. Electrification of parts of the car--->hybrids---->plug-in hybrids--->total electrification of the systems---->all electrics. We have entered stage 2 which is hybrids, and the first stage is being completed one part of the car at a time. When electrics surpass all of the advantages of the ICE, there won't be a point to install an ICE engine in every car at all. The market will demand it. Nick: Our government has a finger in many pots, including where they shouldn't be. Frankly, I can do without the sarcasm from you. I can see the necessity for fuel taxes to fund roads and for other purposes. But when I see people here shouting for$3 in additional fuel taxes, I'm going to ask them to justify their positions for doubling the price I'm already paying at the pump. Because that money would come right out of my pocket, and I'm anything but rich.

And given the sorry state of our current government, I don't trust them with any more of my money.

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