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Retirement Planner: Rate of return is big for electric cars

In the face of their obvious advantages, I’m surprised at the headwind affecting what should be the booming popularity of electric cars. A friend emailed the other day to point out that Fiat had presented him with what was effectively a free Fiat 500 — the cute little Italian “replicar.”

What makes it free is that it is all electric and can be leased for $200 per month. This is less than what my friend’s wife used to spend per month on gas and service on her clunker. The electricity, if not exactly free, is so cheap during the night that it is not a cost factor. So, she substitutes a lease payment for what she used to spend on gas and service. On that basis, anyone can argue that the car itself is free.
Mitsubishi i-MiEVs are on display during a press conference on June 27, 2013 outside San Jose City Hall where officials announced the low-cost lease of 50 all-electric Mitsubishi i-MiEVs to four local government fleets – San Jose, Los Gatos, Campbell and Mill Valley. San Jose will receive 38 out of the 50 cars. (Dai Sugano/Bay Area News Group) (Dai Sugano)
Plus, she can drive all by herself in the commuter lane — priceless.

Meanwhile, as a Tesla owner for the past six months, I received a petition to sign urging lawmakers to prevent automobile dealers from forcing Tesla to sell their cars through dealers rather than their current practice of selling directly to the public. The dealers’ position is based on archaic antitrust legislation that originally barred manufacturers from creating a vertical monopoly in the automobile industry. The dealers’ stance is equivalent to stores like Best Buy insisting that all Apple (AAPL) stores close
because selling computers and iPhones directly to the public constitutes a monopoly. Dealers have succeeded in oil-friendly states like Texas, but in most other states they have lost their case.


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