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US companies subsidise staff buying hybrids

9 June 2006

Media Release

US companies subsidise staff buying hybrids: Government cash grants will deliver bigger benefits in New Zealand

Bank of America Corp is the latest US company to give US$3000 rebates to staff buying hybrids.

Together with tax credits in some states, the rebates could save staff US$6000 when they buy the climate friendly cars.

The New Zealand Business Council for Sustainable Development says the latest move is further evidence the time has come for the Government to bring in the proposed $3000 cash grants to buyers of fuel efficient, low emission cars in New Zealand.

Business Council Chief Executive Peter Neilson says it is pleasing to see some companies see major benefits in encouraging hybrid buying, but a nationwide policy here covering all fuel efficient, low emission cars would have a far greater and quicker impact.

The Government is now considering the Business Council's policy to give cash grants of up to $3000 to buyers of new and imported fuel efficient, low emission vehicles as part of its climate change policy review. Six out of 10 New Zealanders support the policy in nationwide UMR polling.

Mr Neilson says his organisation's research indicates 86,000 climate friendly cars would enter the national fleet in the first year cash grants are introduced. Cash grants would make buying hybrids viable for companies, and would spur sales of other lower-priced fuel efficient, low emission models, both petrol and diesel powered.

The cars attracting cash grants will meet the latest Euro IV emission standards, in a move aimed to upgrade one of the world's oldest fleets, improve air quality and health and help the country battle down greenhouse gas emissions. This, in turn, will lower the country's Kyoto carbon deficit.

Transport is responsible for 14 million tonnes (14Mt) of CO2 equivalent emissions a year, the second highest source behind agriculture (37Mt) and the country is forecast to overshoot its first Kyoto emissions target by 64Mt in the years 2008-2012.

"It's better to direct money into very effective quick ways to reduce emissions here, rather than send the cash offshore under the Kyoto agreement," Mr Neilson says.

"In a way Kyoto carbon credits are a bonus. The big benefits will come from renewing the vehicle fleet, improving air quality and cutting back on the 400 people here who are now dying prematurely each year because of illnesses related to fuel particles from vehicle exhausts. Treating people with illnesses caused by fuel particles is costing another $400 million a year. The grants policy would cost the Government $103 million a year. We advocate ending it after five years. Fuel efficient, low emission vehicles would then be the norm," Mr Neilson says.

Bank of America Corp announced overnight it is offering its rebates scheme to 21,000 employees working in or near Los Angeles, Boston and Charlotte, North Carolina. It may extend the scheme to its 202,500 employees nationwide next year.

The technology company Google also offers employees US$5,000 rebates to buy, or US$2,500 to lease, hybrids. St. Paul offers a 10 percent discount on insurance for hybrids. Some other California companies also offer incentives.

ENDS

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