Updated: Dec 18, 2022
For more information on making a great car buying decision, please see: Cutting through complexity: A confidence-building car buying approach
Our car-buying approach is helpful for the environment.
From a strictly economic standpoint, car pollution like carbon monoxide emissions is a negative externality. This means the economic activity of driving a car creates a cost to an unrelated third party. In this case, this third party is society at large. Pollution can also be considered in the economic context of the “Tragedy of the Commons.”
According to The Economist,
“Today only 22% of the world’s greenhouse-gas emissions are covered by pricing schemes, and those schemes are not joining up”
In the case of the model presented in this article, costs fall under “Maintenance and lower cost of ownership.” Since pollution is not a direct cost, it is not overtly considered here. The good news though, pollution is considered in the “Remaining Miles” / CPRM calculation and the “Safe Transportation” car buying utility statement. This occurs because, generally, smaller cars and smaller engines provide safe transportation, have lower remaining mile costs, and are less likely to pollute. Thus, the CPRM approach is aligned with providing lower pollution alternatives. The CPRM approach will recommend cost-effective EVs as well.
Notwithstanding The Economist’s comment, it would not surprise me if the future pollution-related cost of ownership becomes more of a direct cost pricing scheme through carbon taxes, low carbon emission tax incentives, and related cap and trade schemes. It is my hope society is able to appropriately account for environmental costs. We are running out of time.
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