To Reduce Energy Use, Buy an 8-cylinder 1980 Bonneville!

Posted by Don Fullerton on Nov 4, 2011

Filed Under (Environmental Policy, U.S. Fiscal Policy)

My green choice is to get about 12 miles to the gallon.  Here is why it’s so green.

Some people think it’s obvious that I ought to buy a hybrid or other fuel-efficient vehicle.  But that’s just wrong.  Certainly some drivers should have a hybrid car to reduce emissions and energy use, namely somebody like my brother who has an hour commute each day, driving 20,000 or more miles per year.   But not everybody.   Take for example a person like me who lives near work, rides a bicycle, and doesn’t like spending hours in the car – even for a road trip to the Grand Canyon or Yosemite.  I use the car once a week for the grocery store, or a restaurant, driving less than 5,000 miles per year.

Let’s suppose a hybrid gets 50 miles per gallon, so my 5,000 miles per year would cost about 100 gallons ($300 per year).   The standard non-hybrid gets 25 miles per gallon, which would cost twice as much ($600 per year).  I’d save $300 per year in the hybrid.  But that doesn’t mean I should buy a hybrid.  A new hybrid like a Toyota Prius costs about $6,000 extra to get that great fuel-efficiency (about $26,000 instead of $20,000).    In other words, it would take twenty years for my $300-per-year savings to make up for the extra $6,000.  It’s not worthwhile for me.  If my brother drives four times as much, however, he could break even in just five years.

So far, that means I should not buy a hybrid.  Does that mean I buy the normal new car with 25 mpg for $20,000?  No!  I should buy a beaten old 8-cylinder Bonneville, which looks like a tank and gets only half the mileage!  That Bonneville may be headed for the junk heap, so it’s certainly cheaper, even if I have to pay more for gas.

But even ignoring the price of the Bonneville, I claim that the fuel-use of the Bonneville is less than the fuel use of the normal new car!  Why?  Consider the emissions from fuel used in production.  The fuel used to make the Bonneville back in 1980 is a “sunk cost”, a done deal that does not change whether that car gets junked now or later.  In other words, keeping that Bonneville off the junk heap requires no extra fuel and emissions to produce it.  But buying a new car does involve more fuel and emissions just to produce it.  Think about all the emissions from the steel mill, the tire factory, the glass furnace, and the electric generating plant that provides power for the tools and machinery to make the new car.

In other words, I can reduce total fuel use and emissions much more if I purchase the 1980 Bonneville and drive it 5,000 miles per year, than if I buy a new car with twice the mpg.  Now all I need is a bumper sticker for my 1980 Bonneville to say how green I really am!

 

3 Responses to “To Reduce Energy Use, Buy an 8-cylinder 1980 Bonneville!”

  • Kevin Waspi says:

    Bravo Professor Fullerton!

    You have hit upon the beauty of vintage/beater/recycled vehicles and the folly of programs like “cash for clunkers” all in one nice, tidy article!

  • Qi says:

    but the auto mobile industry has been one of the pillars that drives the economy going, and this is more true in China. I bet no one from Ford or GM would agree with this idea. Besides, isn’t that true that adverse selection happens in the second-hand market. I agree with the idea that by purchasing used cars you actually save energies and fuels used to produce the new ones, however, if all of us sticking to being green in this way, a lot of people are going to be out of the job market, which could be an negative externality to the social welfare, right?

  • J says:

    Qi:

    If I’m not mistaken, your argument is somewhat equivalent to the “broken window” theory.To see why it actually a fallacy, there is a fine little book out there titled “Economics in One Lesson”.