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Blog: Government Support for Electric Cars

Nov 18, 2010 | By Laura Quigley, NETWORK Intern

If the United States is serious about maintaining its dominant position on the world stage, the government needs to increase its investments in renewable energy. As talk of climate change and running out of oil becomes more of a reality, countries around the world are turning toward renewable energy and it’s time the U.S. followed suit.

One of the best ways to do so would be through direct government subsidies to companies that make electric cars.  It’s no question that Americans love their cars, but our love of the open road is coming into conflict with concerns about sustainability. We need an alternative that allows us to keep driving without jeopardizing our future. Electric cars are the answer; they provide a solution that utilizes renewable energy and is pollution free. 

The increase in the number of hybrid cars purchased, from under 10,000 ten years ago to over 200,000 in 2009, indicates that Americans want to drive more fuel-efficient and ecologically friendly cars. With zero tailpipe emissions, no car is more ecologically friendly than the electric car. However, when the cost of a hybrid or electric can be hundreds or thousands of dollars more than a standard, people are forced to sacrifice their environmental ideals to their financial realities. Government subsidies could change that. 

If the government provides subsidies to companies that produce electric cars it would allow them to sell cars that are more affordable. The production costs would be the same – the difference is that the government will pay for some of these costs. With a lower price tag, the demand for these renewable energy vehicles will undoubtedly increase. Because companies have received government subsidies, they will be able to meet reasonable profit expectations.  Subsidies will make electric cars more accessible to consumers, which in turn will stimulate competition among car manufacturers. Already, the demand for hybrid cars has led most of the major car companies, American and foreign, to create at least one model to stay competitive in the market. The production of less expensive electric cars can further stimulate the competition.    

Although their existence is barely acknowledged in the U.S., electric cars have already created a substantial impact in Europe.  The presence of these cars can be explained in part by their compact nature that makes them ideal for navigating