The California Air Resources Board requires that zero-emission vehicles represent 2 percent of major automakers’ sales in the state by 2003.
The problem? There are no profitable, full-function zero-emission vehicles on the market .
The solution? California will give manufacturers four credits toward the mandate for every NEV they sell in California through next year.
The credits can be bought, sold and traded among companies. Because the penalty for failing to comply with the requirement is $5,000 per credit, straight math suggests a credit value of $20,000 per NEV.
But automakers say it’s too early to know what the value of the credits will be. If not enough zero-emission vehicles can be found in 2003, companies that have no requirement to meet the mandate could ratchet up bidding for credits they have earned through the sale of NEVs.
Automakers like Ford’s Th!nk or DaimlerChrysler’s GEM could sell their surplus credits, if any, or hoard them for use when the mandate increases the number of zero-emission vehicles they must sell.
Mike Love, National Regulatory Affairs Manager for Toyota Motor Sales USA, said some companies already are trying to peddle credits. But Love said he’s not aware of any credits that have been sold.
“You can probably buy (credits) cheaper now than you can later,” he says.
“On the other hand, it might be worthwhile to wait until the last minute. When you’re buying a concert ticket from a scalper, the price drops real quick once the concert starts.”