Do I Hear the Word “Rebound”?

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By Bob Difley

Subtle signs indicate that maybe this economic thunderstorm is starting to fizzle out–at least in the RV marketplace. Country Coach has reopened with Chapter 11 bankruptcy protection and has sold a couple units (at about $600,000 each) and has deposits on a few more. Though they have only hired back about 20% of their workers they claim to be able to produce one unit a week and will attempt to sell them direct from the factory. That may (or may not) be good news for buyers who assume that by cutting out the dealer middle man the retail price will be more attractive. Or will it mean more profit to the manufacturer. And of course you will have to journey to Junction City, Oregon to make your purchase rather than your friendly neighborhood dealer.

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Just as with Dirty Diapers, Change is Coming

If change gets your adrenaline pumping, you are living through a great and historic period. The most pervasive and disruptive changes in history are happening all at once in major segments of the world’s operations: energy, the economy, climate, and politics.

In energy, the end of fossil fuel and foreign oil dependence is clearly visible down the road, as renewable energy sources whittle away at 100 year-old energy profiles. Another strange thing is happening. The Wall Street Journal reports that energy demand from utility companies has dropped dramatically in 2008 where they normally see a 1 to 2 percent increase. It appears that “the trend isn’t a byproduct of the economic downturn,” according to the WSJ, “and could reflect a permanent shift in consumption that will require sweeping change in their industry.” Could it be that a general population shift toward conservation of energy use and away from waste could be triggering the lower usage? Maybe it’s time for utility companies, with the help of government incentives, to change their business plan from making a profit from how much energy they can sell to how much energy they can save for their customers.

In Politics, no one needs to be reminded of the historic nature of new president-elect Barach Obama. But not only the election of an avowed energy and environmentally conscious leader, but with also a supportive House and Senate behind him, we may finally see a much quicker move to renewables and restraints on global warming than from the reluctant, anti-environmental former government. One of the big changes has already happened with Thursday’s House vote to strip Rep. Dingle from Michigan of his chair of the powerful Energy and Commerce Committee that also oversees climate change and global warming. He was replaced by ethics bulldog and avid environmentalist, Henry Waxman. Dingle has long been a protector of the auto industry by fighting the government’s enactment of stronger fuel-economy standards and opposing tough air pollution limits on power plants. And with environmentalist Barbara Boxer as chairwoman of the Senate Environment and Public Works Committee, you can expect an ally in making great changes to protect the earth and the environment–all good news for RVers who love the great outdoors.
The changing role of energy with the Waxman/Boxer led committees will be particularly effective in California, where the current government along with Rep. Dingle had previously thwarted the state’s efforts at leading the way in enacting stronger environmental and fuel economy standards than in place by the federal government.

With the more environment-friendly folk in charge, the possibility of what the San Francisco Chronicle headlined as Electric Car Paradise could become a reality. The article reported on a $1 billion investment into the Bay Area cities of San Francisco, Oakland, and San Jose to build the nation’s first electric vehicle network. The plan calls for Shai Agassi’s company, Better Place, to invest in a network of electric-vehicle charging and battery-exchange stations (similar to programs already being built in Israel and Denmark) throughout the Bay Area by 2012. In exchange for this investment, the three mayors will create cohesive regulations for electric vehicles that will apply to the region’s cities and counties. With this type of forward-looking and highly-visible program, soon we will see a plethora of EVs on the market. One car company (no, not one of the Big 3 Detroit dinosaurs), BG Automotive, also announced this week that they will introduce by March of 2009 a 4-door, 5 passenger, electric city car with a top speed of 40 mph, capable of 60 to 120 miles per charge (depending on battery configuration), that will charge in any 120-volt outlet, and sell for $16,000 - $18,000. These will make perfect, emission-free, environmentally-friendly, high-mileage, and economically-practical tow vehicles behind our motorhomes–and they even come in a variety of colors.

Reducing Fuel Usage: Option or Necessity?

By Bob Difley
“This year’s record-shredding spike in gasoline prices has finally ended,” says the San Francisco Chronicle in an article last Tuesday (July 29), “with prices falling by more than a penny per day.” Data from the US Energy Information Administration showed that American drivers used 3.2% less gasoline in the last four weeks than during the same period last year. The AAA Auto Club found that 1.3 fewer Americans traveled during the 4th of July weekend than a year ago, the first time travel has dropped in a decade on major holiday weekends. “Consumers have definitely sent a message,” said an AAA spokesperson.

Could it be that the lesson of supply and demand we learned in Economics 101 really works? Don’t rush out to buy that 40-foot diesel pusher just yet, however. Oil prices, being an international commodity, will rise and fall on rumors, fluctuating demand, threats of disruption to oil fields from terrorists, severe weather, interpretations of new events, statements by the political candidates, and the whims of oil futures speculators to name a few. An economics professor at Carnegie Mellon University says that oil could swing anywhere from $50 a barrel during a global recession to $250 if we end up at war with Iran. But the underlying force that will ultimately drive oil prices is the rising consumption of energy and oil of the emerging nations of India and China, whose billion plus populations want the quality of life that we have, including an automobile in every garage.

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