Advanced Automotive Technology: Visions of a Super-Efficient Family Car

of new vehicles and current vehicle owners appear to have accepted current emission control-

based vehicle requirements.^71 Consequently, policies that promote the introduction of advanced

technologies (through regulatory measures such as fuel economy standards, or other means)

might well be accepted even if costs are not greatly reduced below expected levels if society

values the fuel savings that would result as much as it has apparently valued the air quality

protection afforded by current controls.

Finally, it is worth noting that the long-run incremental prices of some of the advanced vehicles

are a few thousand dollars-a significant amount when comparing vehicles that are otherwise

identical, but an amount close to the price of some automotive features (such as four-wheel drive)

whose value to many purchasers appears to be mainly psychological. This implies that it might be

possible to build a market for advanced vehicles by somehow shifting the market’s valuation of

some of the “nonmarket” benefits of these vehicles, such as striking a blow for energy security or

improving the environment.

THE FEDERAL ROLE IN ADVANCED AUTO R&D

The federal government has played an active role in the research and development (R&D) of

advanced automotive technologies for more than 20 years. From the Energy Policy and

Conservation Act of 1975 through the Energy Policy Act of 1992, Congress has used a

combination of mandates and R&D finding to promote the development of cleaner, safer, and

more fuel efficient cars. With the Electric and Hybrid Vehicle Research, Development, and

Demonstration Act of 1976, Congress authorized DOE to support accelerated R&D on electric

and hybrid vehicles. Cumulative government finding for the DOE Electric and Hybrid Vehicle

Program since 1976 has been $583 million;^72 however, annual finding has been highly variable

and about half of this total has been spent in the past five years.^73

State governments have also played an important role in automotive R&D, especially relating
to auto emissions and air quality. The California LEV program (and its proposed adoption in
several northeastern states) has not only stimulated joint research by the Big Three on advanced
batteries and EVs, it also spawned a myriad of small companies aiming to produce EVs to meet
the 1998 requirements. Japanese manufacturers interviewed by OTA indicated that they had
largely abandoned EV research, until the California mandate forced them to renew it in earnest.

7lActually, the only significant areas of complaint about vehicular emissions control programs appear to be the inspection and maintenance

programss and fuel requirements--- not the onboard vehicular controls. To be fair, however, it is important to note that this acceptance was not

immediatelywon. During the early years of the emissions control programs, when the new controls adversely affected vehicle performance,there were

significant problems with consumer acceptance and disconnecting of control systems. 72

73 Industry contractorsalso provided cost sharing of contracts, typically in the range of 5 to 20 percent.

DOE officials interviewed by OTA attribute this rapid increase in funding to the 1991 California Low Emission vehicle program (especially the

zero emission vehicle requirements), which forced the major automakers around the world to accelerate the development of electric vehicles.