This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

BMW Cuts Off Toyota, GM and Ford in California

Updated from 6:45 a.m. EST with Wahlman's response to reader questions. The response follows the end of the original article.

NEW YORK ( TheStreet) -- The most coveted prize for the California car buyer is the ability to drive solo in the carpool lane. There are two ways to do this:

1. Buy an all-electric or natural gas car. Let's say that you want to spend less than $35,000. Then your most available all-electric choices are Nissan LEAF and the Ford Focus Electric. The problem with these cars is that most people shun them because they are -- rightfully -- afraid of running out of electricity, and they may be stuck on the freeway. With only approximately 75 miles range, sales of these cars are bleak for a reason.

2. Buy a car that's electric for the first 6 to 38 miles, and then a gasoline engine kicks in to ensure that you can drive and refuel the car just like any conventional petrol car. This gets you some of the electric car benefits, but none of the "range anxiety" worry of the all-electric cars.

The cars in this latter category in the market today are General Motors' (GM - Get Report) Chevrolet Volt, the Toyota (TM - Get Report) Prius Plug-In, and two models from Ford (F - Get Report) just hitting the market now, called C-Max Energi and Fusion Energi. Net after-tax rebates, all of these cars sell for around $30,000. As evidenced by the 2012 sales data, this latter group of cars vastly outsell the all-electrics -- and sales are growing rapidly.

So what's the problem? Just buy the Volt, the Prius Plug-In, or any of the Fords, and drive alone in the California carpool lane! No?

Actually, while this will work just fine right now, this convenient party is coming to an end -- fast. You see, only 40,000 of these permits will be provided. The program only started recently, and by early October 2012 approximately 6,000 had been handed out. Now that Ford is entering the market this month, the pace should accelerate and I would be shocked if these permits don't dry up by the second half of 2013.

So what happens when these coveted 40,000 permits are exhausted? Will you then be forced to buy a potentially more expensive ($50,000 to $100,000) Tesla (TSLA - Get Report) Model S? Or will you live with range anxiety in a car that may only go 75 miles on a charge, with no back-up safety valve?
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
F $13.62 0.44%
GM $31.75 -0.16%
TM $102.47 0.76%
TSLA $241.80 0.43%
AAPL $93.64 -0.11%


Chart of I:DJI
DOW 17,891.16 +117.52 0.66%
S&P 500 2,081.43 +16.13 0.78%
NASDAQ 4,817.5940 +42.2360 0.88%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs