Road Pricing Beyond the Technology

Sunday 20 September, 2009 @ 9.00 – 17.00

Radisson SAS Royal Viking Hotel, Vasagatan 1 SE-101 24 Stockholm, Sweden

PRELIMINARY PROGRAMME

(As of 4 June, 2009; Subject to Change)

Road Pricing is an economic instrument that can be part of a package of measures to address overall mobility. This is not a seminar about the technology of road pricing but about strategic objectives, policy, monitoring, measuring and managing of road pricing schemes which are the core values of IBEC. Be prepared for frank discussions!

The benefits of pricing include the immediate traffic impacts but also the economic and social benefits that effective pricing can generate. Of course these benefits vary widely depending on the type and scale of pricing. Systems that provide a « guaranteed » level of service, such as those that involve some form of variable pricing should help business and individual travellers to solve a key transportation problem of the 21st Century – reliability. Then, there are the environmental concerns; to what extent does road pricing provide a useful contribution to greenhouse gas reduction? But, it’s all got to be implemented, and road pricing has a public image problem to address also.

Key Issues

● What are the economic benefits of road pricing and how can they be measured?

● Can road pricing provide large scale and long-term economic stimulus for a 21st Century economy?

● How should we inform and consult with stakeholders?

● What about social equity – do we understand the social distribution of costs and benefits?

● How should we manage politics and public expectations?

● Are HOT lanes a step in the right direction or a dangerous distraction?

● What have we learned from current efforts at implementation?

● Where have real benefits been delivered and what have we learned from the failures?

Time Schedule

9:00 Welcome

9:15 Session 1: What each region is doing in Road Pricing

This session will provide an international survey of Road Pricing policies and activities from around the world. More than being descriptive, each speaker will put developments into context by explaining transport objectives and how pricing is seen as a tool to address the transport challenges faced.

Chaired and coordinated by Alan Stevens, TRL, UK

10:45 Break

11:00 Session 2: Deployment challenges in relation to Stakeholders

Public acceptance is crucial for road pricing success. In this session, experts from the Road Pricing community will describe the challenges of informing and consulting stakeholders, particularly transport users, about the benefits of pricing.

Coordinated by Jane Lappin, Volpe National Transportation Systems Center, USA and Amy Ellen Polk, Citizant, Inc., USA

12:30 Buffet Lunch at the Fisk restaurant

13:15 Session 3: Evaluation challenges

This session will consist of presentations and discussion of Road Pricing deployment and evaluation challenges and how can these challenges be overcome. This will include a wide range of issues and all workshop attendees are invited to participate in the lively discussion that is anticipated.

Chaired and coordinated by Steve Morello, Egis Projects, France

14:45 Break

15:15 Session 4: Business case for society

This session will tackle the broad macro view of the economic and other benefits to society of road pricing and how we can tell if we are doing a “good job”.

Chaired by Kevin Borras, Thinking Highways, UK – Coordinated by Dick Mudge, Delcan, Inc., USA

16:45 Wrap-up

17:00 End of seminar

Registration Fee and Payment:

Fee: € 75 incl. taxes (approx. SEK 793 based on 5 May, 2009 exchange rates on www.xe.com).  It includes seminar materials, 3 coffee breaks and lunch at the venue restaurant.

For registration and other related event information, please contact:

Odile PIGNIER – Harmonised Events – Email: odile@harmonised-events.com

Tel: +33 (0)2 41 54 76 30 – Fax: +33 (0)2 85 52 00 08

Find more information @: www.ibec-its.org

(Source:  Foreign Policy Magazine)

Cartoon Courtesy: Slate Magazine

Outside a small group of nihilists and committed free marketeers who’d have let General Motors go under, no matter the price, few question the necessity of the Obama administration’s plan for the once great American company’s reorganization in bankruptcy. But as a U.S. taxpayer, and therefore one of GM’s brand-new owners, I have my doubts about our ability to manage this new property. Yes, GM’s previous owners proved unable to run a competitive car company in a global marketplace, but is the U.S. government really the best one to transform it? Already, the particulars of the Chapter 11 arrangement lead me to fear that the same sort of internal politics, unthinking nationalism, and generalized aversion to engineering risk that have hobbled GM for decades will continue to haunt its new incarnation.

One place where you won’t hear for-attribution criticism of the “new” General Motors these days is GM headquarters. Perforce they are obligated to display their gratitude with the unfailing enthusiasm that a $50 billion-plus investment in a failing business minimally entitles its benefactors to expect in return. Although the collegial tone of the new rapprochement comes 50 years late, it is heartening nonetheless to see American industry finally welcome Washington’s involvement in matters like safety, fuel economy, and emissions regulation.

Even Robert “Maximum Bob” Lutz, GM’s outgoing product czar and vice chairman, and a fierce critic of government meddling from the “give me back my bullets” wing of Detroit’s old school, has experienced an astonishing change of heart, at the ripe age of 77. Speaking to a gathering of journalists in Motor City the other week, Lutz unhinged every jaw in the house when he shared his thoughts on how the White House automotive task force ought to become a permanent fixture. Of the unprecedented government-industry collaboration the Chrysler and GM bankruptcies begat, Lutz, an ex-Marine attack pilot and near-libertarian known for making his daily commute in a decommissioned Czech jet fighter, quipped: “Jeez, it only took 30 years for somebody to finally figure [government-industry partnership] out.”

Er, right. Thirty years and a couple of epochal bankruptcies.

Questions about the government’s intentions for the new GM Lite already abound. Notably, what will and what should the company’s policies be, now that it is controlled (in theory) by and for the benefit of U.S. taxpayers, who own 60 percent of its shares?

Will GM be underwritten so as to lead the market in the direction of fuel saving and new technologies? Or will it trim its sails and attempt to get by on its sometimes-profitable religion of pickup trucks and SUVs, perhaps ones that get slightly better mileage? GM is still tooled up to build them.

Ever since the 1920s, when GM’s Alfred P. Sloan introduced the precepts of what came to be known as Sloanism — a car for every purse and purpose — a good day at a car dealership was one when you sold someone “more car than they need.” Automobile marketing often appeals to man’s baser emotions. Greed, lust, and envy come to mind, as do excessive horsepower and other costly and unnecessary options that have been larded on to new cars to boost profits for longer than any of us have been alive. So, you can’t help wondering, has the U.S. government entered the business of encouraging people to live out their most insane automotive dreams? Will it labor to create demand for automobiles when and where there is no need, as generations of car companies have done before it?

And where do GM’s new taxpayer/shareholders stand on the matter of outsourcing work to Mexico or South Korea or China or anywhere else, as the old GM did whenever it got the chance? Will Chevy production lines in places like Toluca and Silao, Mexico, come home to the USA? The old GM went in for cheap overseas labor. Has the government now entered the business of using taxpayer money to export jobs? Is this the change we need?

Myriad practical and philosophical quandaries aside, one vital series of questions about the “new” GM — which brands will be kept, sold, or terminated — has already been answered. Chevrolet, Buick, Cadillac, GMC, Australia’s Holden, and South Korea’s Daewoo are to be spared. To be sold: Saturn, Hummer, and Sweden’s Saab are available outright, and operating control of GM’s German division, Opel, is to be sacrificed in a deal brokered by the German government outside U.S. bankruptcy proceedings. For the scrap heap: Pontiac, the venerable division that once claimed to “build excitement.” In limbo: Opel’s English sister brand, Vauxhall.

Click here to read the entire article.

(Source:  Time)

The International Air Transport Association (IATA), which represents 230 airlines worldwide, increased its loss estimate from the $4.7 billion it forecast in March, reflecting a “rapidly deteriorating revenue environment.”

Although there has been growing signs of a bottoming out of the recession, IATA said the industry was severely hit in the first quarter with 50 major airlines reporting losses of more than $3 billion. Weak consumer confidence, high business inventories and rising oil prices pose headwinds for future recovery, the association said during a two-day global aviation conference in Kuala Lumpur.

Revenues are expected to decline by $80 billion — an unprecedented 15% from a year ago — to $448 billion this year, and the weakness will persist into 2010, it said.

“There is no modern precedent for today’s economic meltdown. The ground has shifted. Our industry has been shaken. This is the most difficult situation that the industry has faced,” said IATA Chief Executive Giovanni Bisignani. The Geneva-based association also revised its estimated loss for last year to $10.4 billion from $8.5 billion previously.

It said passenger traffic for 2009 is expected to contract by 8% from a year ago to 2.06 billion travelers. Cargo demand will decline by 17% and some 100,000 jobs worldwide are at risk, it said.

The association expects the industry fuel bill to shrink by $59 billion, or 36%, to $106 billion this year, accounting for 23% of operating costs with an average oil price of $56 a barrel. But crude oil prices have rallied in recent weeks, breaching the $70 a barrel level on Friday on hopes of economic recovery.

IATA said carriers in all regions were expected to report losses, with Asia-Pacific to be the hardest hit amid a sharp slowdown in its three key markets — Japan, China and India. The region’s carriers are expected to post losses of $3.3 billion, worse than the previous forecast of $1.7 billion but better than the $3.9 billion losses last year.

North American carriers are expected to lose $1 billion, far better than its $5.1 billion losses in 2008, thanks to early capacity cuts and limited hedging by U.S. airlines.

(Source: Autoblog & Autoweek)

Americans may have the opportunity to welcome the Tata Nano to their shores in just over two years, according to a confirmation from David Good, a U.S. rep for the Indian automaker. Before it arrives, Tata assures that the ultra-cheap compact with a base price of just $2500 will be configured to meet all emission and crash standards. If successful, we could see see versions of the Indian microcars running on biofuel and diesel.  This begs the question whether the price point will continue to stay around $2500 even after meeting such stringent safety and emissions requirements? Probably not! It is safe to say that the price would be a little less than $5000  – the expected price of the Euro version.

But who will distribute the teensy Tatas? Well, that’s up in the air right now. A brand-new dealer network for the brand has been discussed. Another option would be selling the Nano through Jaguar and Land Rover dealerships — the Indian automaker owns both, after all.  But this option seems highly unlikely,  according to Stuart Schorr, a spokesman for Jaguar Land Rover, who dismissed the rumours.

A larger European version is slated to debut in 2011, and has an upgraded engine that could get 67 mpg. That car is still expected to come in at less than $5,000.  Tata would be the second Indian company with cars on U.S. streets. Global Vehicles U.S.A. Inc. of suburban Atlanta plans to introduce pickups made by Mahindra & Mahindra Ltd. later this year.

(Source: Streetsblog & Wall Street Journal)

The Obama administration is working on a plan to fill the shortfall in the nation’s highway trust fund by August without adding to the federal deficit, Transportation Secretary Ray LaHood told Congress yesterday.

The highway trust fund, which relies mostly on gas-tax revenue, will need up to $7 billion in additional money by the end of summer to ensure states continue receiving payments, LaHood told the transportation subcommittee of the House Appropriations Committee. The fund also will need up to $10 billion in the 12 months after September to ensure its solvency, LaHood said.

“We believe very strongly that any trust fund fix must be paid for,” LaHood told members of the House Appropriations Committee’s transportation panel. “We also believe that any trust fund fix must be tied to reform of the current highway program to make it more performance-based and accountable, such as improving safety or improving the livability of our communities — two priorities for me.”

The administration’s quest to offset its trust fund fix, which will cost as much as $7 billion, could prove fruitless.  Rep. John Olver (D-MA), chairman of the panel that greeted LaHood today, put it simply when asked if the necessary spending cuts could be found. “That’d be very tough,” he said, noting that his own annual transportation spending is unlikely to become law before the highway trust fund runs out of cash.  Replenishing the trust fund with a cost offset, as LaHood suggests, requires a serious conversation about finding new long-term revenue sources for not just highways but all modes of transportation.

But he said the President Barack Obama administration has ruled out raising the gas tax to provide additional funding, saying an economic recession isn’t the time to make such a move.  “We are not going to raise the gasoline tax. I’ll just say that emphatically,” LaHood said.

Click here to read the entire article.

(Source: AP via Yahoo)

General Motors Corp., just days after the bankrupt carmaker sold its Hummer brand, said Friday that it has reached a deal to unload Saturn to racing legend and auto dealer Roger Penske.

 General Motors Corp. has a tentative deal to sell its Saturn brand to former race car driver and dealership group owner Roger Penske, both companies said Friday.

Penske has signed a memorandum of understanding that would give his dealership chain, Penske Automotive Group, Saturn’s 350 dealerships, the companies said. Penske said that he expects to offer all the dealers new franchise agreements and will retain all 13,000 Saturn employees for the immediate term.

“I would expect that the model that we’re putting together, the distribution model, will be profitable day one,” Penske said in an interview with The Associated Press. “We’ll have less costs. We’ll not be in the manufacturing side.”

Neither Penske nor GM would say how much Penske is paying for the brand. Penske said he expects the deal to close in the third quarter.

Penske Automotive Group also distributes Daimler AG’s Smart subcompacts in the U.S., but Smart has its own dealership network and Saturn dealers will continue to exclusively distribute Saturn vehicles, Penske said.

Initially, GM will continue to produce on a contract basis the Saturn Aura sedan as well as the Vue and Outlook SUVs, the companies said. But Penske said he is in talks with manufacturers around the world about building Saturn cars in the future.

GM Chairman Roger Smith first unveiled the Saturn brand in November 1983, describing it as a revolutionary new way to build and sell small cars in America. But the project was slow to develop and the brand did not officially launch until 1990. It featured the iconic tag-line “a different kind of car company.”

GM’s hope was that Saturn would attract younger buyers with smaller, hipper cars to better compete with Japanese imports. It built a new plant in Spring Hill, Tenn., devoted to Saturn production. The factory had more flexible work rules than traditional GM plants for the employees who built the cars.

Image Courtesy: Penske Automotive Group

Despite a cult-like following that drew thousands to annual reunions in Spring Hill, the brand never made money for GM. The factory stopped making Saturns in 2007 and currently builds only the Chevrolet Traverse.

As GM focused more on high-profit pickup trucks and sport utility vehicles, Saturn began to languish in the late 1990s. Then in 2006, car buyers began to find Saturn’s new models more appealing. But after a good year in 2007, sales dropped 22 percent last year as the U.S. car market withered.

Penske Automotive also distributes Daimler AG’s Smart subcompacts in the U.S., but Smart has its own dealership network and Saturn dealers will continue to exclusively distribute Saturn vehicles, Penske said.

Carl F. Galeana, who owns two Saturn dealerships north of Detroit, said Friday he was thrilled that Penske would be the Saturn buyer.

“Roger Penske is an icon in the business world,” Galeana said. “I’ve worked with him personally. Nobody works harder than Roger Penske.”

Galeana said the fact that Penske is interested in Saturn means the brand has value.

“It allows Saturn to get back to its original roots, which is to be an independent car company,” he said.

Shares of Penske Automotive rose 52 cents, or 3.6 percent, to $15.13 in midday trading on news of the sale. The stock has enjoyed a brisk rally this year, more than tripling from an annual low of $4.82 in March.

During a press briefing earlier this week, GM Chief Executive Frederick Henderson said Saab has attracted three bidders, but he declined to reveal names.  The renowned Hummer brand was sold to a Chinese heavy machinery company a couple of days ago and this transaction will conclude upon clearance from three different Chinese government agencies .

Click here to read the entire article.

(Source: ENR.com & Wall Street Journal)

The Obama administration said as much as $17 billion in additional federal money is needed to maintain roads and bridges over the next two years, underscoring the challenges policy makers face as driving habits change.

Image Courtesy; Stateline.org via Gmanet.com

The recession and gas-price increases over the past two years have caused many consumers to drive less and switch to more fuel-efficient cars. The result has been a fall in revenue from taxes on gasoline and vehicle purchases, which are used to fund state and local transportation projects.

Officials from the  Obama administration and U.S. Dept. of Transportation have said that the trust fund will not have enough cash to cover commitments to states for highway projects, according to Senate Environment and Public Works Committee Chairman Barbara Boxer (D-Calif.) and the panel’s top Republican, James Inhofe of Oklahoma.

According to administration and DOT officials, $5 billion to $7 billion will be needed by August to avert having to slow down Federal Highway Administration reimbursements to state DOTs, Boxer and Inhofe said on June 2. The lawmakers added that a further $8 billion to to $10 billion will be needed in fiscal year 2010 to maintain the highway program at its current level. Congress has set the 2009 federal highway program obligation limit at $40.7 billion.

Boxer and Inhofe discussed the trust fund’s problem at a June 2 committee hearing on the nomination of former Arizona DOT Director Victor Mendez to be the new head of the Federal Highway Administration.

Inhofe raised the possibility of tapping the interest on the Highway Trust Fund balance as one solution. That interest goes to the general Treasury, not the trust fund.

The administration has resisted calls to increase the 18.4-cent federal tax on a gallon of gas; the tax hasn’t been raised since 1993.

Last year, Congress transferred $8 billion from the government’s general fund to the highway trust fund in response to a similar shortfall, allowing states to move ahead with hundreds of job-creating transportation projects. Congress may do that again this year.

Lawmakers could also consider tweaking the economic-stimulus law so states could use some of their stimulus money to compensate for other budget shortfalls. In most cases, states can’t use stimulus funds to compensate for budget deficits in their transportation-spending plans.

Congress and the administration are crafting legislation that would determine how the federal government funds transportation projects over the next several years. With the White House opposed to a gas-tax increase, lawmakers are trying to identify new money sources to maintain the nation’s infrastructure.

One hint of their approach could come later this month when Rep. James Oberstar (D., Minn.), chairman of the House Transportation and Infrastructure Committee, is slated to unveil his blueprint for transportation spending.

(Source:  The Detroit News & SFGate.com)

Supporters have dropped an attempt to add “cash for clunkers” legislation to a tobacco regulation bill now before the Senate, a setback in efforts to boost car sales with federal subsidies.

“There are technical details to work out and the senator continues to look for a vehicle to pass this very important piece of legislation,” said Brad Carroll, a spokesman for Sen. Debbie Stabenow, a co-sponsor of the bill.

Two congressional aides said the measure was derailed by objections from the Senate Appropriations Committee to using money from the $787 billion economic stimulus package for the measure, which would offer up to $4,500 credits for consumers trading in older, low-gas-mileage vehicles.

In January, Sen. Dianne Feinstein, D-Calif., introduced a bill, S247, that would give vouchers to people who turn in a car or truck that gets 15 or fewer miles per gallon to a dealer that scraps it.

Rep. Betty Sutton, D-Ohio, introduced one in the House, HR1550. A compromise version was attached to the 900-page energy bill that was passed last month by the House Energy and Commerce Committee.

Sen. Debbie Stabenow, D-Mich., introduced an almost identical one in the Senate. Her bill, S1135, would provide vouchers of $3,500 or $4,500, depending on the difference in gas mileage between the clunker and the new vehicle. The vouchers could only be used to buy or lease new vehicles, not for used vehicles or mass transit.

Environmentalists oppose the two industry-supported bills because they would provide vouchers to people who scrap more fuel-efficient vehicles (18 mpg or less) than under the Feinstein proposal (15 mpg or less).

Last month, Sen. Feinstein proposed an alternative that is less stringent than her original bill but stricter than Stabenow’s. For details, see links.sfgate.com/ZHHC.

It’s not clear whether the Senate will back the Stabenow bill, the new Feinstein approach or a compromise.

“Fiscal conservatives and environmentalists oppose the more permissive Stabenow bill as an expensive subsidy for the ailing auto industry, while union and manufacturing interests oppose the stricter Feinstein approach, which would likely favor fuel-efficient imported vehicles,” said Benjamin Salisbury, an analyst with FBR Capital Markets, in a report.

“The Senate could vote on both amendments and add the most popular one to unrelated legislation giving the Food and Drug Administration regulatory authority over tobacco products,” Salisbury wrote.

Idea likely to stick around

That didn’t happen Wednesday, as many expected. But with President Obama in favor of cash for clunkers, the idea is not likely to die.

Becker hopes Congress will not rush into passing a bill without enough research and debate to determine how much the program will cost and who will benefit most. “Somebody might come along and do clunker dating,” matching up people who want to buy new cars with people who have clunkers, he says.

He adds that Germany started a 1.5 billion euro cash-for-clunkers program this year and it has already swelled into a 5 billion euro program.

Consumers waiting to buy a new car until a bill passes should first figure out if their existing car would qualify under the scrapping plan. If so, the next question is whether the voucher would be worth more than the price they would get if they sold or traded in their car. If so, they should figure out whether the new car they want to buy would qualify. With so many unknowns remaining, it’s hard to reach a conclusion.

(Source: CNNMoney.com)

President Obama to address nation.

General Motors, the nation’s largest automaker and for decades an icon of American manufacturing, stood Sunday on the brink of bankruptcy and a de facto government takeover.

Image Courtesy: CNN Money

A bankruptcy petition will be filed on Monday at 8 a.m., according to a source with direct knowledge of the bankruptcy proceedings.

Investors who own 54% of $27 billion in GM bonds have agreed to not fight plans for a quick bankruptcy process, GM said on Sunday.

The deal with bondholders could make it easier for GM to restructure by neutralizing some of the opposition to a bankruptcy filing. But it does not wipe away the need for the company to seek court protection for making drastic reductions in dealer, labor and other costs.

President Obama will address the nation shortly before noon on Monday to discuss the bankruptcy, two officials close to the situation told CNN. Obama will explain the rationale for the filing and his hopes that this is the best route for a turnaround.

It is expected that GM will detail some 20,000 job cuts and the closure of about a dozen plants by the end of 2010. The company has already said it will slash 40% of its network of 6,000 retail dealerships by next year and drop four of its brands — Hummer, Saab, Saturn and Pontiac.

The impact of GM’s bankruptcy, which follows a Chapter 11 filing by Chrysler on April 30, will ripple across the nation to dealers, suppliers and other businesses large and small that work in the sector.

The company, once the country’s largest private sector employer, has only a fraction of its former staff. Its 80,000 hourly and salaried U.S. employees are half the number it had as recently as 2001.

Nearly 500,000 U.S. retirees, as well as more than 150,000 of their family members, depend on GM health insurance and pension plans. Retirees will see cuts in their health care coverage, although the company’s underfunded pension plans are not expected to be affected by a bankruptcy filing.

In addition, some 300,000 employees at GM dealerships will be affected, as well as hundreds of thousands of workers at auto parts makers and other GM suppliers whose jobs depend on the company’s survival.

The future

A Chapter 11 bankruptcy filing would aim to help GM emerge with only its more profitable plants, brands, dealerships and contracts. GM’s unprofitable plants, contracts and other liabilities that the company can no longer afford would be left behind.

The government has already given GM $19.4 billion to fund operations and cover losses this year, and total help is expected to exceed $50 billion.

GM will pay back $8 billion of that sum. The government will also receive $2.5 billion in preferred shares of GM that pay a dividend and are more similar to a loan than stock.

But more than $40 billion of federal help to GM will be converted into the 72.5% stake in the new company. Taxpayers would make back the money loaned to GM if shares of the new GM increase dramatically in value following an exit from bankruptcy.

GM is expected to have about $17 billion in debt following bankruptcy, significantly less than the $54.4 billion it owed as of March 31.

(Source: BBC & CNN Money)

Germany has agreed a deal with Magna International, a Canadian-Austrian car parts maker, to take over Opel, part of the European wing of US carmaker GM.

Talks in Berlin continued into early Saturday before Germany’s finance minister announced a deal.

The German government is expected to provide an immediate loan facility of 1.5bn euros ($2.1bn, £1.3bn).

But 2,500 jobs in Germany could be lost and a UK minister has accepted “there is excess capacity” in GM’s operations.

Finance Minister Peer Steinbrueck told journalists outside the chancellery shortly after 0200 local time on Saturday that a deal had been agreed.  Earlier on Friday, Opel and Magna’s reached a preliminary agreement with GM.

“We have an agreement,” said Mr Steinbrueck, the AFP news agency quoted him as saying, following six hours of talks between German politicians, US government officials and executives from GM and Magna.

Magna, teamed with Russian auto maker OAO GAZ Group (GAZA.RS) and state- controlled OAO Sberbank (SBER.RS), has said it will put more than 500m euros ($700m; £435m) into Opel.

Steinbrueck said the parties involved also agreed on the model of a trusteeship for Opel for the interim period.

Speaking after the marathon talks that started Friday afternoon in Berlin, Magna co-Chief Executive Siegfried Wolf said he expects the deal with General Motors to be signed in five weeks.

Wolf confirmed that Magna will provide the short-term cash demand of EUR300 million to Opel, which was one of the key reasons for the German government to delay the decision on state aid earlier this week. He said the funds would be available Tuesday.