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Old 02-26-2008, 06:11 PM   #1 (permalink)
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Canadian government caves in to automakers and kills auto efficiency rebate program

The Canukistani Feds unveiled a new budget today. It kills the EcoAuto program which they launched just last year.

For those who aren't familiar with the story: the program offered rebates of $1k, $1.5k or $2k to buyers of efficient cars (6.0L/100 km combined fuel consumption was the $1k threshold). On the flip side, it penalized buyers of gas hogs with a "green levy" up to $4k, depending on the level of hoggishness. It was designed to be revenue neutral.

From day one, most of the auto manufacturers hated the program for a variety of reasons, not the least of which was that it interfered with the market and favoured some manufacturer's products (Toyota & Honda) over others (just about everybody else).

There's no doubt the program was flawed, particularly since the thresholds where the rebates were offered (and the rebate amounts themselves) were fixed points, rather than a sliding scale.

That meant, as Honda discovered to its horror when the program was unveiled last year, that the 5-speed Fit missed being eligible for the $1000 rebate by 0.1 L/100 km, whereas the Yaris 5-speed snuck under the wire.

The manufacturers put up an aggressive public fight via the media (and no doubt a private fight as well, as in lobbying efforts) denouncing EcoAuto at every turn.

Too bad. Because the program worked.

On two fronts: e.g. sales of efficient, rebate-eligible cars went up; and automakers whose models missed the threshold by small amounts modded their vehicles to get them into the rebate territory (or out of "penalty" territory). The program caused manufacturers to make more efficient cars. Honda modified both its 5-speed Fit and Civic to boost efficiency slightly to get them below 6.0L/100km.

Ah well. It was a surprise in the first place to see such a program come from a Conservative government; but it's no surprise to see a Conservative government bury it.


See earlier thread: Canada's ecoAuto feebate program leads auto makers to tweak models for better MPG

Honda mods: Ecomodding my $800 Honda Fit 5-speed beater
Mitsu mods: Oops, I did it again! Bought another cheap, 3-cylinder Mirage. Mods in progress...
Ecodriving test: Manual vs. automatic transmission MPG showdown

has launched a forum for the efficient new Mitsubishi Mirage - fuel efficiency info for Geo Metro owners - electric car conversion on a beer budget
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