Friday, March 03, 2023

True Cost to Own

This post was inspired by a Twitter exchange with a Culver City resident who was able to shed one of her family's two cars due to the Move Culver City Project to reallocate space from cars to transit (bus lanes), active transportation (walking/biking) and micro-mobility (scooters, wheelchairs). 

Culver City's city council balance changed from 3/2 in support of this street space reallocation to 3/2 opposed. The new city council wants to reverse the street space allocation and give 100% of the public space to cars again despite the city's own data that transit and bike use grew explosively while car use declined.  Read the Move Culver City Mid-Pilot Report.  

I think reversing Move Culver City is a big mistake for many reasons, but I will just get into the financial angle in this post. 

Car ownership is so normalized in US society that I think we stop paying attention to how much it's really costing us. When AAA published their annual report "How Much Does it Really Cost to Own a New Car 2022", it surprised many people. 

There were the usual arguments that not everyone buys a new car. But, this assumes the average new car sells for $33,301 when Kelley Blue Book reports that the average car price set a new record in December 2022 at $48,681. Car and Driver reports that Los Angeles drivers pay $681/year more for car insurance than the national average.  

$10,728 is an underestimate for the cost to own a car in Los Angeles. That price also does not include the cost of a parking spot, which you are paying for whether it's a line item in your budget or not.  Everyone seems to complain about parking, even though Los Angeles has more homes for cars than for people

If households with multiple cars can shed one car, they can save $10,728/year. 

Median Culver City household income in $97,540 with a marginal tax rate (CA+Fed) of 33.3%. 

Owning a car costs $16,084/year pre-tax. 

If that money were put in a tax-deferred retirement savings account every year for 30 years, that household can accumulate just under $1 Million! 

I assumed that the money was saved in a Vanguard Growth and Income Mutual Fund (VGIAX) earning about 6.54% over the last 20 years or 10.78% over the last 10 years. 

The Bureau of Labor Statistics CPI inflation calculator says inflation ran 2.65% over the last 20 years. 

Using a conservative 4% above inflation estimate for VGIAX, the Bankrate Compound Interest Calculator shows that the household that was able to shed a car winds up with $916,300 after 30 years in their retirement savings account. Yes, you do pay taxes as you withdraw that money, but that's a huge chunk of money nevertheless. 

In Summary, if Move Culver City allows families to shed one car, then that is a $1M gift to the families in Culver City. 

Reversing/removing the street improvements--making buses too slow to use and bicycling too dangerous to attempt--forces families into cars again. If they have to own a second car again, then Culver City families lose $1 M. 

Elected officials should think long and hard about whether they want to force car dependency and costs onto their residents. It's not good for residents, it's not good for the planet, it's not good for the city. Finally, I don't think it's good for the elected officials' ability to get re-elected. 

Sunday, February 05, 2023

We're subsidizing the wrong electric vehicles

I read that Tesla raised the price of their popular Model Y SUV after the US altered the tax credit rule to make the Model Y eligible for tax credits. The Tesla Y is the most popular Tesla in my area so I looked up the specs. It's a relatively heavy vehicle at ~2,000 kg or ~4,400 lbs. But it can only carry a relatively paltry 433 kg of passenger + cargo. That's about a 5:1 ratio between vehicle and payload. 

I've been eying a Tern GSD and one of my friends has been bragging about how his top of the line GSD R14 was the best purchase he's ever made. He's 6'5" tall and he carries his similarly tall 10 year-old son and everything they need for the school and commute run between central Boulder and their mountain home. The Tern GSD S10 weights 33.5 kg (before accessories) and can carry an additional 200 kg! That's a 1:5 ratio between vehicle and payload.

That means this family with two Tern GSDs can haul 400 kg, or almost as much as a Tesla Y at about 1/5 of the cost (before the tax credit).  I know that the battery range on a eBike is much shorter than for the Tesla, but cyclists can easily find regular outlets to charge their eBikes up while taking a break. 

Vehicle kgVehicle Capacity kgBattery WhCostTax Credit
Tesla Y1929-201043381,000$54,990 - $57,990$7,500
Tern GSD S1033.6200400-900$5,399$0
2*Tern GSD S1067.2400700-1,800$10,798$0

You can add a trailer to one of the Tern GSDs and haul just as much as the Tesla Y!

Best of all, you can roll eBikes onto a train and then roll off at farther destination. Or you can carry them in an elevator up to your apartment rather than pay for expensive car parking stalls. 

I digress, if only we had a transportation system with great train service and bicycle-friendly roads.  Sigh. 

Enjoy this video, including the end where the young couple exit from a Taipei rail station near the beach. 


Remember Carbon Intensity of eBiking vs Driving? I use about 10 Wh/mi when utility cycling around my hilly area, often with shopping and other cargo. When I Tweeted about this, a father who carries 2 children and groceries on his Cargo eBike Tweeted back that he gets about 14-18 Wh/mi on his eBike and about 250-300 Wh/mi in his EV. That's similar to the Model Y performance. 

So a family riding on 2 Tern GSDs will use about 35 Wh/mi while the same family & cargo on the Model Y will use 250-300 Wh/mi. The Model Y is very efficient for such a heavy vehicle. They are both pretty efficient compared to an ICE car. 

The current problem is the global supply constraints on batteries. The same battery materials that go into one Model Y could build 200 eBikes. Do we build one electric SUV for one family, or 200 cargo eBikes for 100 families? If we focus only on replacing cars one for one with electric ones, then we will miss out on all the savings from mode shifting to lighter, more efficient electric vehicles.

Researchers in Europe did the math and concluded that fixating on larger and longer range EVs while battery supplies are constrained can increase CO2 emissions by slowing the global mode shift required.

The new electric SUV market under battery supply constraints: Might they increase CO2 emissions?

Again, looking at the micro view, an EV lowers CO2 emissions relative to an ICE car. But, zoom out and look at the macro view, putting too many eggs in one basket (literally too many battery packs in a large EV) vs a bunch of baskets (eBikes), can increase global CO2 emissions. 

We're subsidizing the wrong vehicles. If we really wanted to reduce emissions quickly, we would be subsidizing eBikes and scooters, transit, and building safe and supportive infrastructure for micro-mobility ASAP. We're not and that's the tragedy. 

The College Board is a conservative organization

I'm bemused by the brouhaha over the College Board dropping "controversial" and important subject matter in the AP African America History after Florida Governor DeSantis and other conservatives objected. 

What did we expect? The College Board is a fundamentally conservative organization that preserves the status quo. They long offered subject matter tests for Greek and Latin, which is taught at elite private schools, while they did not offer any tests for Asian languages until the addition of Japanese in 1993. They didn't even offer Mandarin until 1994

What's inexcusable is the deference that we gave to the defenders of the unequal status quo. 

When I applied to the University of California, we had to have studied 3 years of a foreign language tested by the College Board. CB did not test for any Asian languages in the 1980s. Thus, I studied German in high school, sitting in the same classroom as Peter Thiel, a native German speaker who immigrated from Germany. 

I would have loved to have studied Mandarin instead, but my high school only offered languages accepted by the University of California, while only accepted languages tested by a testing service organized to sort students from elite high schools in the Northeast for elite colleges of the Northeast. 

This kind of circularity was mind boggling to observe but I sucked it up and studied German and Latin in HS. It was so unfair that all the Asian American students, many of whom spoke an Asian language at home, could not enjoy the same privilege as white students who got to learn a language at public school that they can use to speak with their parents and grandparents at home. 

Because of US immigration law that severely restricted immigration from Asian countries before 1966, most of the Asian American kids in my HS were immigrants who spoke an Asian language at home. 

We had to learn a THIRD language just to get into California's public universities. 

Our test scores for European languages were evaluated against kids learning only a second language. Even worse, we got no credit for knowing Asian languages. 

The College Board has power in part because we give them power. We can cut them out. 

What if, we didn't give value to AP test scores and the curriculum they represent? What if we taught a more in-depth curriculum, tailored to the needs and interests of the students? We'd lose some uniformity, but be more relevant to each student. We might even foster more love of learning for its own sake. 

Colleges and universities can just request a list of the books and readings used in history classes rather than rely on the AP test to create a de facto curriculum. Have kids supply a writing sample from their history or literature classes.