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Honda sets too high a price on its 2013 Civic Natural Gas
Howard Richman, 11/30/2012

For 2013, Honda raised the prices for almost all of its Civic models by $160. The one exception was the Civic Natural Gas which it reduced in price by $160. Its manufacturer's suggested retail price will start at $27,255.

Although this was a step in the right direction, it did not go far enough. Honda only reduced the approximately $6,000 price differential between its gasoline and natural gas models by a measly $320 even though a CNG (Compressed Natural Gas) vehicle costs about the same amount to manufacture as a gasoline vehicle. The vehicles are very similar except that the CNG vehicle requires an expensive fuel tank while the gasoline vehicle requires an expensive catalytic converter.

But, at the present price differential, even if a commuter could save $1,000 per year by buying less expensive CNG instead of gasoline, it would still take more than 5 years to recoup the huge difference in purchase price.

Last year, Honda made the Civic Natural Gas available at dealerships countrywide. If, this year, it had reduced its natural gas model's price significantly, there would have been a huge increase in the size of a the CNG car market which Honda currently monopolizes. More CNG filling stations would spring up and the American economy would benefit from the substitution of domestically-produced natural gas for imported oil.

Fortunately for America, other companies are moving much more aggressively than Honda to take advantage of CNG's potential growth. For example, in July GE announced that in a about two years they will market a reasonably priced home filling station for natural gas vehicles. Specifically:

GE will team with gas processing company Chart Industries Inc. and the University of Missouri to develop an inexpensive home refueling station that would connect to home gas lines, compress the gas and deliver it to vehicle fuel tanks. The project will receive $2.3 million through an Energy Department program called the Advanced Research Projects Agency for Energy.

The goal is to create a home fueling station that could sell for $500 and fuel a car in less than an hour. Home fueling stations now cost $5,000 and take five to eight hours to compress natural gas and fill a vehicle's storage tank. The high price of home refueling currently reduces or eliminates any savings a customer might realize from lower fuel costs.

Hopefully, when GE's home fueling station becomes available, either a more aggressive automobile company will enter the CNG car market or Honda will discover that it can price its CNG model low enough to take advantage of the market's potential growth. Until then, the growth in CNG usage will come almost entirely from trucks and buses.

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Comment by Ron Wagner, 11/31/2012:

The only choice for a low income buyer is a used CNG vehicle, or a conversion of a low priced vehicle. There are converters who have reasonable prices.

Please see the conversion page on my free blog.  It is near the front of my natural gas stories:

 



       Natural gas is the future of energy. It is replacing dirty old coal plants, and dangerous expensive nuclear plants. It will fuel cars, vans, buses, locomotives, aircraft, ships, tractors, air conditioners, engines of all kinds. It costs far less.  It will help keep us out of more useless wars, where we shed our blood and money. It is used to make many products.  It lowers CO2 emissions. Over 3,100 natural gas story links on my free blog. An annotated bibliography of live links, updated daily. The worldwide picture of natural gas.
ronwagnersrants.blogspot.com

 

Response to this comment by Howard Richman, 11/31/2012:
I just bought a used CNG pick-up truck.  I love it!




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  • [An] extensive argument for balanced trade, and a program to achieve balanced trade is presented in Trading Away Our Future, by Raymond Richman, Howard Richman and Jesse Richman. “A minimum standard for ensuring that trade does benefit all is that trade should be relatively in balance.” [Balanced Trade entry]

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  • [Trading Away Our Future] Examines the costs and benefits of U.S. trade and tax policies. Discusses why trade deficits matter; root of the trade deficit; the “ostrich” and “eagles” attitudes; how to balance trade; taxation of capital gains; the real estate tax; the corporate income tax; solving the low savings problem; how to protect one’s assets; and a program for a strong America....

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