Archive for March, 2008

Tax Breaks Not Offered for All Hybrids

Wednesday, March 5th, 2008

There are a variety of reasons to by a hybrid car. They are cleaner and better for the environment. They are quieter, adding less noise to an already ear splitting world. They use less gas, so drivers can see significant savings when they fill up at the pump. For many people, the promised tax breaks for hybrid owners is enough to tip the scales in the favor of the gas and electric vehicles.

One of the most popular of all of the hybrid cars is the Toyota Prius, but buyers of new Priuses may be in for a shock come tax time. The popular car is no longer eligible for a tax credit. Neither is the Honda hybrid cars.

It has always been hard to understand the way the hybrid tax credit has worked. The credit is applied to all qualified hybrid purchases between 2006 and 2010. Oddly enough, there is no credit for plug in hybrid vehicles, even if such vehicles make it to the market by 2010.

The tax credit, or the Alternative Motor Vehicle Credit– its official name, is based on the hybrid’s maker and the model. The amount of the tax credit is based on the weight of the car and the car’s gas mileage. It is also based on how many of the hybrids have been sold. Only the first 60,000 of any hybrid model is eligible for the full tax credit.

The tax credit cap was part of a deal that lawmakers made to get the support of American automakers who did not want Toyota and Honda to have an unlimited tax credit benefit. Since Toyota and Honda were the first auto makers to introduce hybrids, so it is no surprise that both Honda and Toyota have met the 60,000 car sales limit.

Ford, which was the first American car maker to debut a hybrid car, could possibly meet the 60,000 car threshold this year, but General Motors is still far from reaching the cut off and Chrysler has yet to manufacture a vehicle that qualifies for the tax credit. The first hybrid vehicle that Chrysler plans to market is a hybrid version of the popular Dodge Ram in 2010.

After a car manufacturer sells 60,000 hybrids, new car buyers get a credit that is much smaller than they may have expected. The first cut in the tax credit reduces it by half. The the credit is only one quarter of its original value. The credit will eventually be phased out, so hybrid buyers that expect a tax credit should research their options before they buy.

The tax credit for the Prius was $3150 when it debuted and continued through for cars purchased until September 30, 2006, but for cars bought between April 1, 2007 and September 30, 2007 the credit  had dropped to $787.50.

Honda hit the magic 60,000 car mark during the third quarter of last year, so its credits are alos being phased out like the Toyota’s credit.

Arizona Considering Bill to Make Hybrids Noisier

Sunday, March 2nd, 2008

The Arizona State Legislature is considering a bill that would require car makers to make hybrid cars louder. The motive behind the bill is to make the streets safe for the visually impaired, but critics of the law say that it is foolish to pass a bill requiring a vehicle to add noise to streets that are already loud and raucous.

House Bill 2780 was introduced to the legislature by State Representative Ed Ableser, a democrat from Tempe. Twenty two other democrats signed the bill before it was introduced. According to activists for the visually impaired, many blind people can not hear hybrid vehicles as the approach in electric mode. “Hybrid cars are amazing, and I think one of the unintended consequences of this new technology is that it is so effective in reducing noise on the streets. The fear is that our blind citizens are in danger crossing the road,” said Ableser when asked about the bill. “This bill is to encourage the auto industry to step up and address these issues more quickly than they are now.”

A House committee has already passed the bill that would require all vehicles sold in the state of Arizona to meet a “minimum sound standard.” The National Federation for the Blind has endorsed the bill and has expressed support for similar measures in Hawaii, Virginia and Maryland.

There have been no reports of any injuries or fatalities sustained by blind people as a result of quiet hybrids, but activists are concerned that as more hybrids hit the streets, it is only a matter of time before an accident occurs. “We know that there have been a lot of close calls,” said Chris Danielsen, the federation spokesman who is blind himself. “We would like action to be taken before there’s actually an injury or, heaven forbid, a death from this.”

The federation and other activists say they are just trying to keep the blind safe an point out that the law would also help to keep cyclists and children safe as well.

Critics of the new law say that the lack of noise from hybrid cars is a good thing. They also maintain that because hybrid cars are so new, that it will take society time to adjust, but that society will learn to live with them.

Opponents of the law believe that people will eventually learn to look for vehicles instead of just listening to sounds and that blind people will adapt their resources as well. The Wall Street Journal reports that guide dogs for the blind are being trained to recognize the quieter sound of hybrids when they help the blind cross the street. “I’m kind of mystified about this bill,” Bob Robson, the republican House speaker pro tempore said. “This bill would be the ruination of the auto industry in Arizona. The financial impact is enormous for the state.” The bill was sent to the House after it was passed by the committee, but it was stuck with a “Do Not Pass” recommendation by Robson.