With just a little luck, OPEC should rake in a trillion dollars this year. I say congratulations - way to go! And for importers, wake up!

If it does take 50 barrels of oil to make a car (some would be used outside of China) then we are talking about 2.7 million B/D going to making cars before they go a mile. At even ½ gallon useage per day per car just one year’s production would add 268 thousand B/D to motor fuel consumption or an additional 3 million B/D (2.7 +.268) by the end of the first year.

Wonderful calculation Don. I wonder if people are crazy on this subject. They start a war in Libya for oil, and now that it is over think that they will get cheap oil. As for the 40 to 60 barrels per car, make it 40 for safety

Also, take these figures and extrapolate them across Brazil, India, M.E., SE Asia, .....

Watch for electric vehicles sales to grow strongly with mass consumer markets over the next 5 to 10 years, and, more importantly with virtually every auto manufacturer on board making them, the money they will spend on R&D to improve battery technology will grow substantially.

There was next day mail for 3 cents between Chicago and general delivery at a New York RR station. Also very civilized travel that might mean boarding a train after work, allowing for a quite elegant dinner enroute, maybe a bridge game and a comfortable bed before arriving perhaps early enough the next day to do some work or have a meeting. And it was all done with coal.

The American Legion had a contest every year. On an unannounced day 6th grade students would spend the entire afternoon writing an article of their choosing. I wrote about what I saw as a great problem: our utter dependence on coal. My father rode a coal stoked train to and from work. My home and all those around me and the school were heated by coal. The Commonwealth Edison plants I saw used mountains of coal to make electricity that furnished energy for every factory and street car.

World population had just ticked over to an incredible 2 billion.

I swear everyday I see one more of those Nissan LEAFs in the area and so I fantasize about the reduction in imported oil with every one of those new sightings; a bbl here a bbl there. No....it is not the sam LEAF driving circles around me.....

More seriously, I thought we heard that year on year gasoline demand was down a few percent. So how much is that driven by the "hidden" recession and how much is due to new car fuel economies increasing over the past few years? Or is it my LEAF fantasy (ha ha)?

Mark

Of course, some people are a little tired of my insisting that OPEC determines the oil price, and nuclear makes economic sense, but as far as I am concerned the proof of this is right there in front of anybody who wants or needs proof.

And Don, that transportation system in Chicago was indeed magnificent. In fact, in those days a lot of things in Chicago were great, which is why I got out before things went sour.

While I am sure the proud owners of the new leafs running around your neighbourhood are thumbing their noses at the gas station operators, when the LiH batteries need to be replaced in four years time at a cost of well over half the cost of the car the smiling will turn to agony as one debates whether to send ones 4 year old Leaf to the dump (useless and cannot be sold unless the battery is good) or fork out $18,000 for a new battery bank.

The problem was, is now and will always be the battery. Until that nut is cracked you can forget about electric cars.

We have been studying it for well over a hundred years and the best we can do for power density is the Lead Acid Battery.

Malcolm

As oil prices increase, as I think everyone expects they will, people will look for an alternate fuel and that will be natural gas.

As an example, Poland is sitting on top of at least five shale gas and coal bed methane fields hitherto inaccessible but now due to modern technology very accessible. They have recently made the decision to exploit these fields.. This of course will suppress natural gas prices across Europe once those supplies come on stream and make it much cheaper than gasoline as a fuel. Switching engines to burn natural gas is simple. The ease with which fuels can be replaced is the key and I think the argument is strongly in favour or gasoline to natural gas rather than gasoline to electricity.

Furthermore, a number of companies are developing the technology to make natural gas into gasoline and that of course would avoid conversion costs altogether and remove dependence on imported oil.

Malcolm

I did run across a So Cal Edison individual that indicated that they had some test electric vehicles running in their fleet for the past 10 years or so on original batteries. Dont know the make or model of those batteries. And there is the flow batteries that MIT and others are working on that show some promise for increasing battery energy density by 10 times.

At the end of the day I also see the battle between combustion and electricity being won by the axiom, "simple is best".....the electric motor is simpler than a piston or even turbine.

But I am still with you that nat gas has immediate benefits (cost and geopolitical) that we should embrace full on at least until simplicity wins.....

There is another consideration here besides the simple "get off oil" mantra. Electric cars are indeed very simple and very very very low maintenance. The impact of widespread electric car use will have catastrophic effects on employment in North America and throughout the world. Lets put our mind in an electric car world. There are no mufflers - therefore every single muffler factory and installation shop is gone. The platinum and palladium used in their exhaust systems will no longer be required throwing thousands of miners in South Africa and Russia out of work as the jewelry uses of the metals are insignificant. There are no gas stations - therefore tens of thousands of businesses disappear along with all the delivery truck drivers and the people that make the tankers. There are no gas pumps therefore all the gas pump manufacturers and maintenance people are no longer required. There are no gas tanks - in the ground or in the cars so all the people that make those are out of work. There are no gearboxes since electric motors control each wheel so all the gearbox manufacturers and service centres are out of business. There are no oil refineries since they mostly produce gasoline. I could go on but I am sure you see the point that our dependence on oil goes far beyond the simple replacement of the fuel. Electric cars will be a massive unemployment machine putting millions and millions of Americans and Canadians out of work.

The very simplicity and low maintenance which we all desire has some very high social costs associated with it and as a society this transition needs to be thought out very carefully.

I do not know how many people worldwide are dependent upon the automobile for their employment - I am sure Len Gould will find that out for us - but it is a certainty that their numbers will be vastly lower once a dependable and cheap electric car is mass produced.

Can you envisage in your own community how many businesses would be destroyed by the electric car. There would be very few new ones that is for sure. The only ones that will survive will be brakes, suspension and steering and paint and body shops. Every oil change shop in the country will be history. Every gas station bulldozed flat and replaced with unmanned charging stations. Every air, oil and fuel filter manufacturer out of business. Engine gasket manufacturers gone. Engine casting plants gone. Engine assembly plants gone. Gearbox repair shops gone. Spark plug manufacturers gone. Electronic ignition manufacturers gone, Fuel injection systems manufacturers gone. It is said that for every 1 person employed in the auto industry there are 7 other workers that are employed as a result. That means the knock on effect of closure of all of the plants noted above will result in economic catastrophe. Therefore any such move to all electric vehicles must be done extremely carefully and slowly. Unfortunately I see no government with any strategic plan for the large scale deployment of electric vehicles.

So while we don't much like sending our oil money to the Middle East, Western economies will be in a total shambles without the employment created by the current automobile and oil industry. it is a fact that few even consider in the headlong rush to electric vehicles. It is time they did.

Malcolm

Of course, as Don Hirshberg would tell you if you asked him politely, population growth plus a few other things are going to add to the misery.

(BLS - workers in manufacturing for all transportation equipment 1,624,900 )

So guessing that the group vulnerable to job loss due to auto electrification is only a) and c) and only perhaps 60% of those jobs might be lost due to complete electricification, that number comes to perhaps 1,600,000 jobs. Given about a 5 to 1 ratio of secondary service jobs lost per primary job lost, that makes about 9,600,000 jobs possibly vulnerable, or perhaps 7% ?? of the US workforce.

Of course 100% electrification is probably decades away.

You are correct, there is no doubt the elimination of internal combustion engines would kill huge sectors of the economy in North America as well as in foreign countries. These industry sectors are so big and important that you will recall both the Canadian and American federal and provincial/state governments spent many billions of dollars to keep GM and Chrysler afloat in the Great Recession just two years ago, because if they didn't we would have seen much of the economic catastrophe you allude to.

Consider this however Malcolm. Even if we don't see a rapid deployment of electric vehicles, the future of these huge industry sectors is bleak to say the least. Peak oil means we are in for ever increasing numbers of oil price spikes, and overall increased oil prices on average in the years ahead. This will put a huge damper on sales of gasoline and diesel automobiles that will stifle any growth in these industry sectors. Indeed they will slowly shrink such that these sectors of the economy will die a slow death by a thousand small cuts over many years.

So whether we see rapid deployment of EVs or not, there has to be creation of other industries for the millions of people working in these industry sectors that will surely face unemployment down the road.

And, Malcolm, it’s not just the automobile industries that will be affected by oil prices. Think of the airlines, and large retailers like Walmart etc. They all depend on cheap oil for their successful business models. When oil prices go up they suffer big time, so peak oil means many of these companies will go under over time too.

Yes my friends, structural unemployment in today’s economy may be unacceptably bad, but it will pale by comparison if we don’t create new industries with millions of new types of jobs over time.

Save your pennies guys, we’re going to need them.

I do have a concern as Malcom so correctly has, that if technology changes come so quickly can industry and workers deal with the disruptions in their lives as they are forced to re-educate or relocate themselves ever so more frequently.

I will try to cite some facts as best I know them.

The Toyota RAV-4 EV was built with 95-amp hour NIMH batteries (called "EV-95") built by Panasonic. These have proven to be very durable and have lasted in excess of 200,000 miles. Perhaps these are the vehicles that the So Cal Edison people were speaking of. Because of a patent infringement issue, Panasonic shut down the line that built these batteries. NiMH batteries of this type are limited to about 12-amp-hours. The patent will expire soon, but obviously the momentum on this technology was lost. (They were built in 1998-2001 or thereabouts.) One could argue conspiracy theories, etc., but that's not the point of this note.

The point is that these were "good enough" to give reasonable range to a small SUV vehicle by electric power alone. But what did they cost? I have no idea. Probably a large amount of money. But given 10 years and large production, what would they cost? Probably something pretty reasonable. The battery brains are sold that Lithium Ion is the way to go, and I hope they are right, but I have my concerns.

I think there is still a permanent place for IC engines, at least small ones, on vehicles for extending range. The billions spent on refining the IC engine can still be well-used.

Malcolm's comment on worker displacement is interesting, but a little extreme. I'm not sure employing lots of folks is the best justification for an extreme consumptive society. (The automobile, which is tossed after 10 years, is an example of perhaps unsustainable consumption, more extreme than the great marketing move of disposable razor blades.) But I submit that people will still be fickle w.r.t styling, so perhaps the automakers can rebuild or remodel long-running vehicles, perhaps making better use of the durable 'cores' of the engine/batteries. So we get 'new' cars at a lower cost, and lower waste. Maybe everyone wins.

We have to embrace the technology if it makes sense and has societal benefits regardless of the jobs that are saved or lost. I agree with Mark 's comment as the industry will transform itself just like horse and buggy industry changed into the automobile service industry. Of course, this did not happen overnigh eithert! Having millions of electric cars on the road would mean infrastructures support for maintenance, repair, charging stations, diagnosis mechanics, and parts replacement. What you will encounter will be the auto parts stores, for example, catering to large demand of customers for batteries and accessories, or etc. The communication industry did not miss the call operators that used to connect callers, either. Most were absorbed and employed elsewhere in the same or similar industry.

Steve Ghadiri

A steady move to natural gas fueled vehicles will start the downsizing process for gas stations, oil refineries and gasoline distribution networks but would not affect the vehicle production side of the equation much and consequently the jobs that are allied to it. That change would come later with all electric vehicles.

I do concede the point that is made by Mark and others that we seemed to have successfully made the transition from horse and buggy to internal combustion engines, however the extent to which the entire economy has become entwined with the automobile makes the effects of a transition to all electric cars much more severe that of a hundred or so years ago. For example much of the repairs to horse drawn transport was done at home or on the farm - there was no "Speedy Horseshoes" equivalent to the speedy muffler of today. True, many businesses were affected but remember in the early days all they did was unhitch the horse and put an engine in so it was really only the services for the horse that were discontinued on a large scale.

So it is my view that a rapid and uncontrolled move to all electric vehicles will be very socially disruptive on a world wide scale. To compound the effect the factories that mass produce electric vehicles and their component parts will be brand new, use the latest manufacturing technologies and be fully robotic with very few workers. It will not be a matter of retraining for new skills or new jobs. There will not be any jobs to retrain for.

As I have noted on this site before the "jobless recoveries" western economies have experienced recently has been blamed on the Chinese and Indian work forces. There is an element of truth to that but the real culprit is automation. Factories are using robots in every increasing roles. even in Chine robots are replacing workers because the capital cost has dropped dramatically in the last 10 years along with increased capabilities. With artificial intelligence human production line jobs will disappear - permanently - however much the GDP grows.

So what is at stake is 9.6 million jobs in the USA alone (thank you Len for rising to the challenge - very much appreciated). That number has major social disruption written all over it.

In our rush to get off oil we may shoot ourselves very accurately in the foot

Malcolm

If you are of the opinion that it is not (or should not be) a matter of jobs then take a look at the Swiss watch industry. The quartz crystal technology (invented incidentally BY the Swiss but completely ignored until Seiko saw the potential) almost wiped out the Swiss watch industry overnight and caused serious economic and social repercussions in Switzerland. It took many years for the Swiss to recover from that disaster and we are nowhere near as dependent industrially on watches as we are on cars.

I guess my message is be careful what you wish for. The result may not be what you expect.

Technology of course will not be stopped because of job losses and I do not advocate that. I certainly agree with you on that point. What I do advocate is the careful and measured introduction of electric cars so that society has the opportunity to adjust. My fear is that with the speed of technological change we may not have time or be able to control the social unrest and disruption that will result from massive job elimination in the auto sector.

Malcolm

I think it should be noted how good present and recent cars are. I have a 1997 Winnebago Rialta, a little motor home mounted on a VW truck chassis, a 2003 Venture van (Chevrolet), and a 2002 Tracker (Chevrolet). The engines, transmissions of these vehicles have never requires any service what-so-ever. Except for encounters with deer the Tracker has required exactly one fuse, and an oxygen sensor. Except for being hit by a delaminating semi truck tire the van has required no service other than routine filters and lub. The Rialta has required some house keeping Winnebago and tire service. But except for A/C service nothing pertaining to the VW truck on which it is mounted except for replacing plugs and leads and a serious leak downstream of the fuel pump, both expensive.)

Not only has maintenance cost been lower than I thought possible but mileage has been better than I thought possible.

I stopped keeping gasoline records on the Rialta years ago but up till then it was an accumulative 18 mpg. The van from day one until now has averaged 25.2 mpg, and the Tracker (w/4seldom used 4 wheel drive) has averaged 27.63 mpg.

A child of the Great Depression I have always been miserly about energy and wasting food.

Some quick back of the envelope; Assume a $30K car getting 25 mpg runs for 200,000 miles and needs $5K in service over its lifetime. But that would also be at least $24K in funds going overseas for the fuel.

Compare this with an electric vehicle, needing perhaps $2K in service and $7500 spent domestically on electricity. So less money for servicing vehicle, but less cash going overseas; I think it's a net win.

Your hypothetical car would use 200,000/25 = 8000 gallons. About half of that would be from domestic crude oil. That leaves 4000 gallons from imported oil. If we assume $80/B for imports (equitant to maybe $100/B for West Texas Intermediate) then the reduction in payments to foreigners would be 4000 X 80/42 =7619 vs your “at least 24,000 dollars.” Lest we forget,The biggest “foreign” source is Canada.

But actually it gets much more complicated. American refiners get about 50% yield of gasoline from crude oil. An imported barrel of crude also would also yield LPG, diesel, jet fuels, home heating oil, bunker oil, road oil (asphalt), roofing oil, and chemical plant feed stock for a myriad of products. Plasic bags to Pharmaceuticals. The demand for these would not be decreased by our use of more electric cars.