Monday, June 7, 2010

Tax Credit for $100,000 BMW Hybrid: Bizarre and Wrong

BMW ActiveHybrid 7

BMW ActiveHybrid 7

In one more sign of the need to overhaul of U.S. energy policy, the Internal Revenue Service has certified the 2011 BMW ActiveHybrid 7 for a tax credit of up to $900 under Alternative Motor Vehicle rules.

BMW calls its ActiveHybrid 7 �Sthe fastest-accelerating hybrid sedan in the world.⬝ Acceleration to 60 mph in less than five seconds, and a top speed of 150 mph, will rank it among the fastest sports cars in the world. The 455-horsepower vehicle, which carries a 4.4-liter twin-turbo V8 engine and sells for $103,125, is rated at 20 miles per gallon in combined highway and city driving.

The ActiveHybrid 7 uses turbocharging, direct injection and a mild hybrid system with lithium batteries to produce an 18 per cent improvement compared to the non-hybrid 750i/Li. The premium for the hybrid model is approximately $30,000 over the conventional 7-series sedan.

Hybrid or not, the use of taxpayer dollars to support the purchase of the BMW ActiveHybrid 7 is wrong in many obvious ways. The $900 credit is not an effective or necessary incentive for purchasing the ActiveHybrid 7. In addition, the environmental benefits of a V8 455-horsepower BMW are negligible at best. Meanwhile, tax credits for the most fuel-efficient hybrids from Toyota, Honda and Ford are no longer available�and there�"s no sign that the government intends to restore them.

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