(Source: Jalopnik)

Image Courtesy: Jalopnik

Now that the President has signed the “Cash For Clunkers” into a bill, a lot of you may be thinking hard about trading your old meta for a shiny new one.  Through various articles Transportgooru has already discussed in great lengths about the details associated with the Cash for Clunkers, including the eligibility criteria for trading your old vehicle.

To add to that, our good friends at Jalopnik have put together this awesome list (see below), which I think is a must read for anyone who is contemplating a trade under Cash for Clunkers program.  Here is the list in reverse order.

5.) Buy A Clunker Now!

Some unscrupulous sellers may try and convince you to buy a clunker for a few hundred dollars with the promise of being able to trade it in for a $4,500 voucher. In reality, if you haven’t owned your car and kept it running and insured for a year you’re not eligible. Don’t buy a beater unless you want to keep it for a while.

4.) Trade In Your Car Early! –

We’ve read reports on forums of people already taking advantage of the Cash for Clunkers bill. In reality, they’re being taken advantage of. The law has been signed, but the National Highway Transportation Safety Administration hasn’t finalized the rules. It probably won’t go into affect until after July 24th. If you are being offered a “voucher” on your clunker you’re really just getting money for your trade-in, which the dealer can then resell. The most you lose is your car, but the dealer could face a fine of up to $15,000.

3.) Scrap A Car Worth More Than The Voucher

The used car market isn’t great right now, but this doesn’t mean your vehicle doesn’t have some value. Make sure to check the value of your car using a resource like KBB before trading in an older car that, it turns out, is worth more than $4,500 or $3,500 on the open market. Dealers have a greater incentive to sell you a new car and scrap your old one than to get the value of your trade-in “clunker.”

2.) Get Denied For Other Discounts

The voucher program is not designed to be a stand-alone discount program, meaning you’re still eligible for whatever other discounts automakers are offering (and there are a lot of those). With 0% financing and thousands cash back you’re getting cheated if you just get the value of your trade-in off a new car. The average incentive, according to Edmunds, was $2,930 for June. So you could possibly get $4,500 + $3,000 off of a new car.

1.) Avoid Moving Up To A More Profitable Class

If you own a truck or SUV you can use your voucher to trade it in for a car and, likely, get a larger voucher. Many dealerships will want to put you into a new truck because they’re more expensive than most cars, but if you don’t need a truck you can trade your old one in and find an inexpensive car with 10 MPG better fuel economy, which qualifies you for $4,500. For example, if you’ve got a 1991 V6 Ford F-150 you can trade it in for a $15,000 2009 Ford Focus for your kid and get the full $4,500 off, instead of paying upwards of $20,000 for a new truck and only getting a $3,500 voucher.

(Source: Reuters, New York Times, Washington Post, fivethirtyeight.com & CNN)

Image Courtesy: Climatecrisis.net - An Inconvenient Truth

The U.S. House of Representatives on Friday narrowly passed a climate change bill that would create a national system to cap greenhouse gas emissions and allow trade of such credits. Only eight Republicans joined Democrats in backing the measure. Prospects for Senate passage this year are uncertain. States that have set the U.S. agenda on addressing greenhouse gas emissions are lining up behind a federal climate bill, fearing signs of dissent would weaken a plan that still faces hurdles.

The vote was the first time either house of Congress had approved a bill meant to curb the heat-trapping gases scientists have linked to climate change. The legislation, which passed despite deep divisions among Democrats, could lead to profound changes in many sectors of the economy, including electric power generation, agriculture, manufacturing and construction.

There was no derth of drama in the House from the moment the legislators began the day’s proceedings.  The Democrats released a 301-page amendment to the bill at 3:09 a.m. Friday, drawing protest from Republican Leader John Boehner, R-Ohio.  “This is the biggest job-killing bill that has ever been on the floor of the House of Representatives. Right here. This bill,” Boehner said.

The leaders of the House are customarily granted unlimited speaking time, but when the Boehner’s speech went more than 2½ hours, Democrats objected.  “Is this an attempt to try to get some people to leave on a close vote?” asked Rep Henry Waxman, D-California, the bill’s lead sponsor.

President Obama hailed the House passage of the bill as “a bold and necessary step.” Mr. Obama had lobbied wavering lawmakers in recent days, and Secretary of State Hillary Rodham Clinton and former Vice President Al Gore had made personal appeals to dozens of fence-sitters.

But the legislation, a patchwork of compromises, falls far short of what many European governments and environmentalists have said is needed to avert the worst effects of global warming. And it pitted liberal Democrats from the East and West Coasts against more conservative Democrats from areas dependent on coal for electricity and on heavy manufacturing for jobs.

The House legislation reflects a series of concessions necessary to attract the support of Democrats from different regions and with different ideologies. In the months of horse-trading before the vote Friday, the bill’s targets for emissions of heat-trapping gases were weakened, its mandate for renewable electricity was scaled back, and incentives for industries were sweetened.

Several House members expressed concern about the market to be created in carbon allowances, saying it posed the same risks as those in markets in other kinds of derivatives. Regulation of such markets would be divided among the Environmental Protection Agency, the Commodity Futures Trading Commission and the Federal Energy Regulatory Commission.

Following is a list of key provisions of the landmark bill (thanks to Washington Post):

• Emissions from a large sector of the U.S. economy, including power plants, factories and auto tailpipes, will be required to be cut 17 percent below their 2005 levels by 2020, and 83 percent below those levels by 2050.
• These reductions would be managed by requiring emitters to amass buyable, sellable “credits” equal to their pollution.
• About 85 percent of these credits would be given away for free, many of them with the mandate that electricity distributors sell them and use the proceeds to soften the blow of rising energy prices. Environmentalists had wanted the government to auction them all off.
• Electricity producers would be required to get at least 15 percent of their energy from renewable sources by 2020, with up to 5 percent more energy saved from new efficiency measures. The two figures must add up to 20 percent.
• Polluters could also balance out some of their emissions by purchasing carbon “offsets,” which are official certificates that greenhouse gas emissions have been avoided, or taken out of the air. In a last-minute amendment, oversight over offsets generated on farms was taken from the Environmental Protection Agency and given to the Agriculture Department.
• A new Clean Energy Deployment Administration funded with $7.5 billion in “green bonds” would provide government money to private companies investing in environment-friendly technologies.

Nearly half the U.S. states have moved toward curbing greenhouse gas emissions and want the federal government to learn from their experience in creating systems to cap emissions and trade pollution credits.  States that have set the U.S. agenda on addressing greenhouse gas emissions are lining up behind a federal climate bill, fearing signs of dissent would weaken a plan that still faces hurdles.

Image Courtesy: www.fivethirtyeight.com

At the heart of the legislation is a cap-and-trade system that sets a limit on overall emissions of heat-trapping gases while allowing utilities, manufacturers and other emitters to trade pollution permits, or allowances, among themselves.

The cap would grow tighter over the years, pushing up the price of emissions and presumably driving industry to find cleaner ways of making energy.

Regional considerations tend to loom larger in debates over environmental policy than in other sorts of affairs. Some states consume more energy than others. Some states have more carbon-intensive economies than others.

Some states are more or less likely to be negatively impacted by global warming. And some states are better equipped to take advantage of green energy development.

One of the first of those concerns: household energy usage. The goal here is simple: the Congressional Budget Office recently put out an estimate (.pdf) of the costs of the Waxman-Markey cap-and-trade bill. The CBO estimated that the average American household would wind up paying a net of $175 in additional energy costs in the year it benchmarked, which was 2020. But how does that cost translate to individual states?

Our renowned statistics whiz at fivethiryeight.com has come up with a brilliant way to translate the CBO’s numbers, based on his interpretation of the CBO’s assumptions, to the level of individual states, making it easy for us common folk to understand what is to be expected when this cap and trade takes effect  ( Transportgooru recommends this as a must read article, especially if you care to know about the the nuts and bolts of “cap-and-trade” system)

(Source: New York Times – Wheels Blog, Sec.  LaHood’s Fast Lane Blog, U.S. News and World Report)

First of all, it’s no longer Cash-for-Clunkers. The program is now called the Car Allowance Rebate System (C.A.R.S.).  The program, which President Obama signed into law on Thursday, pays consumers up to $4,500 in credit for trading in their cars or trucks for those that are more fuel efficient. The law allocates $1 billion for the program.

The incentive program begins within 30 days of today’s bill signing by the President. The final day for an eligible purchase or lease is November 1, 2009, or when DOT exhausts the funds set aside for the program, whichever occurs first. The credit is not retroactive prior to the start of the program and cannot be applied toward the purchase of used vehicles.

Of course, there are plenty of regulations to determine what vehicles qualify for the credit. The National Highway Traffic Safety Administration, which is overseeing the program, has put together this Web site to help consumers who would like to participate in the program.

Image Courtesy: USDOT Secretary Ray LaHood's Fast Lane Blog

Today, the Transportation Secretary Ray LaHood wrote on his blog: “This program helps consumers pay for new, more fuel-efficient vehicles when they trade in less fuel-efficient cars or trucks. Stimulating the automobile industry while improving the environment and reducing fuel consumption–these are outcomes the DOT is pleased to support.

Congress and the Obama Administration recognize this is an important time for the automobile industry. And, the CARS program will help boost car and truck sales. Moreover, since the auto industry has improved vehicle safety and reduced vehicle emissions over the years, we are also excited about a program that puts vehicles on the road that are safer, pollute less, and get more miles to the gallon than the vehicles they replace.

CARS will be implemented by DOT’s National Highway Traffic Safety Administration (NHTSA). It’s a new responsibility this department welcomes; I know the folks in NHTSA stand ready to fulfill their new charge.  I encourage everyone to learn more about the program from the website, www.cars.gov, or call NHTSA’s Auto Hotline at 1-888-DASH-2-DOT (1-888-327-4236). ”

The C.A.R.S. rebate does not count on top of the trade-in value of your vehicle. In the F.A.Q. section of CARS.gov: “The law requires your trade-in vehicle to be destroyed. Therefore, the value you negotiate with the dealer for your trade-in vehicle is not likely to exceed its scrap value.”

An Important FYI item: N.H.T.S.A. warns consumers of unofficial C.A.R.S. Web sites that are now popping up, reports USA Today. “Some want a lot of personal information, and talk about consumers being able to pre-register,” said Eric Bolton, a N.H.T.S.A. spokesman. “Consumers don’t have to register for this program at all.”

For those of you who are contemplating the purchase of a new vehicle under this program, here is a wonderful guide put together by the U.S. News and World Report:

10 Things You Should Know About Cash for Clunkers Car Allowance Rebate System”

1. What’s the official definition of a clunker? A driveable car made within the last 25 years, with a fuel economy rating of no more than 18 mpg. To learn more about the combined city/highway fuel-economy of your car, check out the Car Allowance Rebate System site.

2. Here’s how the program works: you trade in your old car for cash towards the purchase of a new, more efficient one. The better the mileage of the new car , the more money you’ll get towards its purchase – either $3,500 or $4,500. Check out Jalponik’s handy chart to figure out how much you might be able to claim.  The minimum combined fuel economy of a new car purchased under the program must be at least 22 mpg, while new small trucks and SUVs have to get at least 18 mpg, and large trucks have to get 15 mpg. The old cars will be salvaged once they’re turned in.

3. Consumers should act fast. The bill provides vouchers for one million purchases, and the window of time is only fron July 1 to November 1. The bill will be revisited in the fall , and some changes may be made at that time.

4. The program will cost $4 billion. Funds will come from TARP.

5. Sorry, would-be entrepreneurs: it’s off-limits to buy an old car and “flip” it for the program – the car must have been insured by the same owner for at least one year before the trade.

6. The environmental idea behind the bill is that it takes old, inefficient vehicles off of the road. But some environmentalists are actually opposed to the bill because it takes functioning cars off of the road before their time is up, and does not permit the vouchers to go towards used vehicles, even if they are more fuel-efficient. Sen. Dianne Feinstein, who sponsored an alternate bill stated that the current version undermines fuel efficiency standards and provides “handouts for Hummers.” On the other hand, some argue that higher fuel standards would disproportionately benefit foreign cars, denying American automakers their much-needed boost.

7. The economic incentive of the bill is to jump-start drowsy auto sales. According to Bloomberg, similar programs worldwide have raised auto sales 25 percent to 40 percent in Germany, 15 percent in China and 8 percent in France.

8. Even if it’s not designed entirely the way environmentalists had hoped, there are still green benefits. Says Treehugger: “One positive effect the bill could have, though, is simply to further advance the presence of ‘fuel efficiency’ as a reward term in the skeptical American consumer market. Yes, hybrids continue to sell, but not to 99 percent of the population. The bill could, albeit in a relatively minor way, serve to advance an attitude that places importance on fuel efficiency in the future.”

9. Cash for Clunkers is expected to have a great impact on the Hispanic community. That’s why the program is getting a celebrity endorsement from Dancing With The Stars’ Cristian de la Fuente and Ugly Betty’s Angelica Vale.

10. As always, buyer beware. It doesn’t make sense to trade in your vehicle unless its value is less than or equal to what you’d get in the program. Edmunds has identified a list of cars that are guaranteed to be worth less than the value of the voucher. You can find it here (PDF). Said ABC News Consumer Correspondent Elisabeth Leamy, “From a strictly consumer standpoint, the Cash for Clunkers program is not a great deal. Yes, if you are bent on buying brand new, you will save money. But the savings are nothing compared with how well you can do by buying a used car.”

(Source: Autoblog, Washington Post,  Detroit Free Press, AFP via Google)

Image Courtesy: Jalopnik

Clears Senate

After narrowly surviving an attempt by Sen. Judd Gregg, R-N.H. to strip it from a war-spending bill, the Cash for Clunkers program passed the Senate yesterday evening. Well, the $106 billion war-spending bill passed the Senate on a 91-5 vote, but the $1 billion scrapping program earlier survived Sen. Gregg’s attempt to have it removed and thus passed, as well. Now the bill makes its way to President Obama, who is expected to sign the bill into law, after which the U.S. Transportation Department reportedly has one month to figure out how the Cash for Clunkers program will be run. Since Congress reduced funding for the program from $4 billion to just $1 billion, it’s expected that the money will run out long before the program is scheduled to end on November 1.

“We are gratified that the Congress delivered on this administration priority, and President Obama looks forward to signing it into law,” according to an administration statement.

Details, Details, Details,

Vehicles purchased after July 1 will be eligible for the refund vouchers worth as much as $4,500 to turn in gas guzzlers and buy new cars that are more fuel efficient.

The agency in charge of administering the program, the National Highway Traffic Safety Administration, will work out all the details within 30 days of enactment, according to Rae Tyson, spokesman for NHTSA.

Congress predicts this will result in the sale of about 250,000 new vehicles. The funding is good only until Nov. 1 and could run out before that. In that case, the voucher pro gram — unless Congress ap propriates more — would end.

Consumers would be able to start using the vouchers as soon as the National Highway Traffic Safety Administration finalizes the rules — a process that must conclude within 30 days of the president’s approval.

Under the program, trade-in vehicles, 1984 models or newer, must have average fuel economy of no more than 18 miles per gallon. And the new car or truck must get better gas mileage than the one that was scrapped.

The payoff grows depending on the difference in the fuel efficiencies of the old and new cars. For instance, a new car getting at least 4 more miles per gallon than the old car will be eligible for a $3,500 voucher. A new car getting at least 10 more miles per gallon would get a $4,500 voucher.

To guarantee vehicles are actually roadworthy — and not just sitting on cinder blocks — trade-ins must be registered and insured to the same owner for at least a year.

Kudos & Pats in the Backs

Image Courtesy: Apture

Cash for clunkers proponents in Congress said the subsidies will spur sales.”The simple fact is that we need to get Americans into car showrooms and this is the bill that will do it,” said Rep. Candice Miller, R-Mich., in a statement.

Sen. Debbie Stabenow, D-Mich., said the program will boost jobs in auto states. “This program will provide an economic stimulus at a time when hardworking families need it most,” Stabenow said in a statement.

GM said it had decided to keep 60 of the more than 1,000 dealers with whom it had sought to terminate agreements. The reversals were made after the automaker corrected financial information that was used to evaluate which stores to keep.  Dealers applauded the Senate’s action yesterday, and some got additional good news.  John McEleney, chairman of the National Automobile Dealers Association, hailed the measure, saying it “will boost consumer confidence, get the economy going again and reduce our dependence on foreign oil. Congress is giving consumers a strong incentive to replace their older vehicles with new, more fuel efficient cars and trucks.”

Transportation Secretary Ray LaHood said “The program is an important step forward for America. “It provides incentives for consumers to buy new, more fuel-efficient cars and trucks, providing a boost to the auto industry and protecting jobs, while limiting fuel use and greenhouse gas emissions.”

The legislation comes with number-one US automaker General Motors in bankruptcy and Chrysler emerging from court protection under a government-backed alliance with Italy’s Fiat in the face of plunging auto sales.

Cash for Clunkers Update from Europe (Channel 4 via Autobloggreen)

Several other countries, such as China and Italy, have offered similar trade-in vouchers. And lawmakers point to the success of Germany’s program as indication that vouchers can turn dismal auto sales around.  At the end of the program’s first month, sales in Germany were up 21 percent from a year before. During the same period, U.S. sales slumped 41 percent. Now,  a leading provider of automotive data and intelligence says the European motor industry is showing signs of recovery following the introduction of scrappage schemes on the continent.  According to a new study by Jato Dynamics, the European automotive market may be rebounding ever so slightly from its alarming lows of early 2009.

Though new car purchases are down by just over 13 percent year-on-year, there was actually a mild 2.4 percent improvement in May over April. The German market is now 39.7% up on May 2008 – a 20.3% improvement over last month’s figures. France, meanwhile, is up 11.8% over the figures for April.  “If Germany provides a template for the other markets where scrappage schemes have been introduced, we may be at the very beginning of a period of recovery in Europe. It’s far too early to know what the sustained effects of the incentives will be, but at a time when the industry needs to see some rays of hope, it’s encouraging to witness some improvement ” says David Di Girolamo, Head of Jato Consult. Interestingly, small, fuel efficient hatchbacks are performing better than the rest of the market, which is thought to be due to the various scrapping schemes in Europe.

The US market has steadied somewhat from lows earlier this year but the sales pace in May remained 33.7 percent below that of one year ago.  Let’s hope the American consumers will follow their European counterparts in boosting the vehicle market> Eeven if it is only a liitle, the market can use any push to build its recovery.

(Source: New York Times & Fox News)

It is not every 31-year-old who, in a first government job, finds himself dismantling General Motors and rewriting the rules of American capitalism.  

Image Courtesy: New York Times

But that, in short, is the job description for Brian Deese, a not-quite graduate of Yale Law School who had never set foot in an automotive assembly plant until he took on his nearly unseen role in remaking the American automotive industry.  

“There was a time between Nov. 4 and mid-February when I was the only full-time member of the auto task force,” Mr. Deese, a special assistant to the president for economic policy, acknowledged recently as he hurried between his desk at the White House and the Treasury building next door. “It was a little scary.”

But now, according to those who joined him in the middle of his crash course about the automakers’ downward spiral, he has emerged as one of the most influential voices in what may become President Obama’s biggest experiment yet in federal economic intervention.  So what does Mr.Deese’s resume look like? It should be impressive, considering he’s managing America’s $458,000 per dayinvoluntary investment.

Deese grew up in a Boston suburb, the son of a political science professor at Boston College. He moved to Vermont and attended Middlebury College, where he studied political science and also took time to host a campus radio show called “Bedknobs and Beatniks,” described in one write-up as “a format of music, news, discussion and banter.”

While far more prominent members of the administration are making the big decisions about Detroit, it is Mr. Deese who is often narrowing their options.

A month ago, when the administration was divided over whether to support Fiat’s bid to take over much of Chrysler, it was Mr. Deese who spoke out strongly against simply letting the company go into liquidation, according to several people who were present for the debate.

“Brian grasps both the economics and the politics about as quickly as I’ve seen anyone do this,” said Lawrence H. Summers, the head of the National Economic Council who is not known for being patient whenever he believes an analysis is sub-par — or disagrees with his own. “And there he was in the Roosevelt Room, speaking up vigorously to make the point that the costs we were going to incur giving Fiat a chance were no greater than some of the hidden costs of liquidation.”

Mr. Deese was not the only one favoring the Fiat deal, but his lengthy memorandum on how liquidation would increase Medicaid costs, unemployment insurance and municipal bankruptcies ended the debate. The administration supported the deal, and it seems likely to become a reality on Monday, if a federal judge handling the high-speed bankruptcy proceeding approves the sale of Chrysler’s best assets to the Italian carmaker.

Click here to read the entire article.

(Source: AP, NY Times, The Infrastructurist, The Atlantic)

The U.S. transportation secretary says Spain’s bullet train system is a model to follow as America plans how it will spend its stimulus package. Ray LaHood says the $8 billion allocated for high-speed railways in the United States will improve the country’s infrastructure, spur economic growth and reduce greenhouse gas emissions. As part of his visit to Spain, he took a ride on the AVE from Madrid to Zaragosa and then hung around in a railway control center with the transport minister for a while. On Saturday he met with Prime Minister Jose Luis Rodriguez Zapatero, the guy who’s has really been the force behind Spain’s recent investment.

When President Obama announced in April his $13 billion plan to propel the United States into the age of high-speed rail, he tipped his hat to the trains that zip between the cities of the Old Continent at up to 217 miles an hour.  Spain opened its first Alta Velocidad Española, or AVE, high-speed train route in 1992, between Madrid and Seville. The network has grown to nearly 2,000 kilometers and stretches from Malaga on the south coast to Barcelona, which is north and east.

Spain, an enthusiastic latecomer to high-speed rail, on Friday will complete a six-day tour of European transit systems that it presented to the American transportation secretary, Ray H. LaHood. Officials say the Spanish experience could hold lessons in what works and what does not.

Supporters say the AVE has begun to transform the country, binding remote and sometimes restive regions to Madrid and leading traditionally homebound Spaniards to move around for work or leisure.

“Spaniards have rediscovered the train,” said Iñaki Barrón de Angoiti, director of high-speed rail at the International Union of Railways in Paris. “The AVE has changed the way people live, the way they do business. Spaniards don’t move around a lot, but the AVE is even changing that.”

Such is the train’s allure that politicians of different stripes have made extravagant promises to lace the country with a sprawling network. Under a plan devised by Prime Minister José Luis Rodríguez Zapatero, Spain will have 10,000 kilometers (more than 6,200 miles) of high-speed track by 2020.

(Source: Financial Times)

Reducing America’s reliance on oil by raising petrol prices to European levels through increased taxes or regulation is not politically feasible, says Steven Chu, US secretary of energy.

The admission comes as Congress considers a cap- and-trade system that opponents say will substantially increase petrol prices just as oil prices soar to their highest level in six months.

In the past Mr Chu, a Nobel laureate, has argued that, if the US wanted to reduce its carbon emissions, policymakers would have to find a way to increase petrol prices to levels in Europe. But in an interview on Wednesday with the Financial Times, Mr Chu said: “At this moment, let me be frank, it is not politically feasible.”

(Source:  Stateline.org via Planetizen)

States are hoping to use federal stimulus money to add technological advancements to their streets and highways to create “smart” roads.

Not all the highway improvement projects states plan to pay for with federal stimulus money involve widening roads, fixing bridges or repaving highways. Nearly half the states plan to use some of their new funds to pay for high-tech gadgets that will reduce congestion, help the environment and create jobs quickly.

At least 22 states have told the federal government they want to make their roads “smarter” by installing traffic cameras, creating express toll lanes, improving traffic signals and alerting drivers about accidents or delays ahead, according to the National Conference of State Legislatures.Such projects are “quick, they can move forward very fast, they create jobs and they’re effective in the short and long term,” said Jaime Rall, an NCSL analyst.States are under the gun to tell the federal government how they plan to use $26.7 billion in federal stimulus money for transportation. They have until June 29 to commit half of that money to specific projects, so states are focusing on projects that can get started quickly.Three-quarters of the money committed by states so far will pave or re-pave roads. Some of the money can go to passenger and freight rail efforts, too.

The Obama administration announced earlier this week that another $1.5 billion in transportation stimulus money can be used for innovative road projects.But included in the mix already are dozens of efforts to use technology to make roads function better. The “smart road” improvements include signals for on-ramps in Colorado, new E-Z Pass toll booths to allow drivers to pay without stopping in Delaware and traffic lights connected to fiber optic cable to reduce bottlenecks in Utah.

Technology improvements, in particular, have a bigger bang for the buck for the economy, the federal government points out, because more of the money goes straight to workers’ salaries. Only 20 percent of material-intense projects such as laying roads or fixing bridges typically goes to payroll, according to a January analysis by the U.S. Department of Transportation. For technology upgrades, about 50 percent goes to paychecks.

(Source:  The Infrastructurist & Asia Times)

The Chinese are at it again.  The Asian juggernaut is rolling ahead with its investment in beefing its modern infrastructure – this time with a massive investment in railways.   With the dedication and determination that has become a hallmark of all things Chinese, be it sports or the development, the country has proved time and again that it is among the best in the world.  Dithering and doing things half-way are not among the national character flaws that might be pinned on the Chinese.  And, perhaps, they’re already at it with this plan to build the world’s largest high-speed rail network. 

China’s rail links totaled 76,600km by end of 2006. But most of them were built at least 30 years ago and some even date back to the early 20th century.   The economic boom of the past two decades has generated soaring demand for rail transportation. In 2006, China’s rail network handled 25% of the world’s cargo and passenger travel, although the country’s railway network only accounts for 6% of the world’s total by mileage. 

In 2006, China’s railway network carried 662.2 billion passenger-kilometers – 2.7 times that of Japan – while it carried 2.87 billion tons of freight, a billion tons more than in the US, and 4.8 times that in India.  To cope with the skyrocketing demand for rail transport, the Chinese government has kept expanding its plans for rail construction. As of March 31, China has committed $259 billion to building its high-speed rail network project, and plans to spend nearly a half trillion dollars more in the next three years, boosting the total investment to $730 billion by 2012.

Of the Chinese investment, at least $1 billion is going to the German conglomerate Seimens for the purchase 100 high speed train sets. They will be, on average, 16 cars–or 1300 feet–in length, capable of carrying 1000 passengers, and capable of traveling 218 mph. Moreover, they will be running on tracks designed to accommodate that speed. Unlike, say, the Acela.  Ultimately, the Chinese government plans to buy 1000 high speed trains to run on a track network of around 25,000 miles. 

A little context here: The US–a country with a per capita GDP about 16 times that of China–has set rail as a national priority and has committed… $13 billion. Or, about 2 percent as much in China. This, of course, is in a place where it costs a hell of a lot more to get anything done.   In the U.S., President Obama’s decision to make high-speed passenger rail service a centerpiece of his transportation agenda is funded in part through the recently passed $787 billion stimulus plan including a total of $8 billion for improvements in the U.S. rail system. The Obama plan also proposes a separate five-year, $5 billion investment in high-speed rail as part of the administration’s suggested fiscal year 2010 budget (FY10 budget outline) to make a down payment on constructing enhanced rail network.

(Source: Wall Street Journal & Politico via Yahoo)

WASHINGTON — The Obama administration plans to order auto makers to increase the overall fuel economy of automobiles sold in the U.S. to 35 miles per gallon by 2016, four years faster than current federal law requires, people familiar with the matter said Monday.

The move is part of a broader overhaul of fuel economy rules aimed at cutting greenhouse-gas emissions.

Image: Fueleconomy.gov

The Obama administration is expected to announce a plan to revamp federal vehicle fuel-efficiency standards to bring them into harmony with the goals of a California greenhouse-gas law. The Environmental Protection Agency and the Department of Transportation will jointly raise fuel-economy standards and reduce greenhouse-gas pollution under the plan.

Separately, auto makers have agreed to drop litigation challenging the legality of state-level curbs on tailpipe emissions of greenhouse gases, people familiar with the matter said.

An announcement of the agreement is expected Tuesday, with representatives of several large auto companies, including General Motors Corp. Chief Executive Fritz Henderson, and the president of United Auto Workers, Ron Gettelfinger, planning to participate, people familiar with the matter said.

The agreement worked out by aides to President Barack Obama represents a partial victory for the auto industry. The industry will be able to operate under a single national standard on fuel economy, rather than multiple regimes at the federal and state levels. Auto makers have long opposed California’s tailpipe emissions program as tantamount to state-level regulation of fuel economy, traditionally a federal responsibility.

But the standards will require huge investments by auto makers to remake their U.S. fleets so that they have roughly the same overall efficiency as vehicles they now sell in Europe, where gasoline is two to three times more expensive as in the U.S. By moving the 35 mpg requirement to 2016 from 2020, the administration is stepping up the pressure on the industry to overhaul its product lineup faster. It typically takes three to four years for auto makers to design and bring a new vehicle to market.

Auto executives are flying into Washington from around the world for the White House announcement.   California Gov. Arnold Schwarzenegger, a Republican, is expected to attend, the sources said.

The CAFE standard was established by Congress in 1975 in response to the Arab Oil embargo.   A 2007 energy law requires auto makers to boost the average fuel economy of their vehicle fleets to at least 35 miles per gallon by 2020, a 40% increase from the roughly 25 mpg standard for the current fleet.  Last summer, the Transportation Department estimated that requiring auto makers to achieve 31.6 mpg by 2015 would cost the industry $46.7 billion, a sum the agency said would make it among the most expensive rule makings in U.S. history.

“This rule will be a down payment on a broader and sustained effort to reduce our dependence on foreign oil,” he said. “Going forward, my administration will work on a bipartisan basis in Washington and with industry partners across the country to forge a comprehensive approach that makes our economy stronger and our nation more secure.”

According to two industry officials familiar with the plan, mileage standards would rise slowly at first — from a combined requirement of 27.3 miles per gallon for cars and trucks in 2011 — and faster approaching roughly 35 miles per gallon in 2016. That would give auto makers more time to adjust — and collect credits if they can manage to exceed earlier targets — before the steeper increases kick in.

It is unclear how quickly the EPA and the Transportation Department’s National Highway Traffic Safety Administration will be able to make a formal proposal for curbing emissions and boosting fuel economy. The EPA on Monday was holding a public hearing on its proposal to find that greenhouse gases endanger public health, the first step toward regulating them.