2 Billion Cars

2 Billion Cars, a book by Daniel Sperling and Deborah Gordon.

The VW Boardroom decides to cheat its emission tests

This book is a very interesting read, particularly at this moment, with the backdrop of the VW emissions scandal in the media. The book covers the recent history of both the oil industry and the car industry, in the context of regulation, efficiency and the drive to reduce emissions.

In particular, the part where the book describes how European and Japanese manufacturers made progress in the US market when they offered more fuel-efficient cars with lower exhaust emissions makes for painful reading. American manufacturers fought tooth and nail against higher efficiency and emission standards for decades, and watched with surprise when they were blindsided by foreign manufacturers who saw this demand coming. Those manufacturers must be feeling a little schadenfreude at the moment as they watch VW and other manufacturers admit that they were cheating on their emissions scores.

There are good chapters on the oil industry and how it works, on the growing demand for cars in Asian economies, and on the regulatory regime in California. The book is a really useful reference on the development of fuel-efficient cars including hybrids, the introductions of regulations worldwide and the resistance of the US-based car industry to improving fuel efficiency.  I expect that the book will appeal most to people interested in transport and sustainability problems (which ought to be most of us!)
Some of the points made in the book

1. Since growth in car usage in developed countries has flatlined, or started to decrease, all the growth in vehicles will come from developing countries, with annual growth rates in vehicles about 7-8 percent annually. Whatever India and China do will have the biggest effect on greenhouse gas emissions. The recent pictures of Beijing and Shanghai smog are testament to the growth in those cities of the number of cars but equally their failure to control emissions. (to be fair, not all of it is from cars)

2. There are large parts of the world where infrastructure costs mean that people will continue to use their cars and will not have public transport available to them in the foreseeable future.

3. The chapter on oil is particularly interesting, and how the oil ‘market’ is really not a market, but is in fact carefully managed supply by the oil producers, many of who are using oil to prop up their economies, and often they are among the few non-democracies (or failed democracies) on the planet. When you think of the success of the developed economies that based their success on ‘Guns Germs and Steel’ you wonder at the current level of success being enjoyed by places like Saudi Arabia, Nigeria and Venezuela and how they are going to make use of it. The signs so far is that they are going to waste the opportunity. Therefore, making the personal passenger vehicle more environmentally-friendly is key if the rest of us are to stop this haemorraging of wealth into corrupt nations that aren’t going to use it wisely.

4. The chapter on the oil industry also highlighted that we are nowhere near peak oil. The amount of unconventional sources such as fracked gas and tar sands is large enough to blow any chance of staying within the 2 Degrees target. So gas and oil usage will have to be further regulated if we have any chance of managing climate change risks to acceptable levels. (is there such a thing?)

5. The authors are very clear that the best way to promote energy independence and reduce emissions is to impose very high fuel performance standards. Government, they say, should never “bet on a technology winner”, but should instead make performance-based goals the only measure of success, both for fuel performance standards, and exhaust standards. (there are interesting parallels here between the support for nuclear energy by some governments and coal by others)

6. The chapter on California was particularly interesting, highlighting why it is in a unique position to influence national policy on sustainable transportation, and how it can therefore influence policy globally. There are parallels with the role of London in the UK, setting higher standards for buildings and cars, and trialling new technologies before other cities. Sadly, the book was published before Tesla really got going, and I hope that the authors do a revised edition soon to cover the meteoric rise of the electric car worldwide in the last five years.

7. The chapters on the history of the American car manufacturers are instructive for a number of reasons. It is an object lesson on how large corporations lose contact with their customers and focus on doing what they have always done instead of being innovative and market-facing. (The idea that markets are always alive to the demands of the market is an over-simplification of reality)I am reminded of the behaviour of UK housebuilders here as they avoid regulation by complaining that the market doesn’t demand energy efficient homes, and that that adding efficiency increases costs.

8. The way that the US manufacturers used perverse incentives to create gas-guzzling vehicles at the point where they should have been investing in R&D of more fuel efficient engines and vehicles tells you a lot about the behaviour of corporates. What well-run company would have bought Hummer? General Motors, thats who.

9. The authors felt that one of the best hopes to increase fuel efficiency when the book was written was to use plug-in hybrids, like the unexpectedly successful Prius. They rightly point out that hydrogen-powered fuel cells remain a laboratory project.

My only quibble with the book is that its already a little out of date, the authors failed to mention the potential for renewable energy and battery storage to play a major role in energy management and the use of smart grids, but since these ideas are relatively recent perhaps its forgivable. Another reason for a new edition.