Alternative Fuel for Lotus Alternative Term Paper

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Concerns about the availability of fuel also slows adoption. In a simulation representing California, entrepreneurs opened alterative fuel stations in urban areas but not in less-populated rural areas where demand is initially lower. According to Science Daily (2007), urban alternative fuel drivers must then avoid the rural areas, reducing the appeal of alternative fuel vehicles and slowing their sales everywhere. In theory, the fuel efficiency of alternative fuel vehicles should attract more buyers; however, in reality, since drivers of alternative fuel vehicles need much less fuel, energy suppliers build fewer alternative fuel stations. This in turn lowers the appeal of these vehicles, and sales of alternative fuel vehicles may in reality decline. Thus, as indicated above, the positive factors associated with alternative fuel vehicles do not meet the burdens that a car rental facility would face with adding alternative fuel vehicles to their rental fleet.

Incentives for Adding Alternative Fuel Vehicles to the Fleet

There are many incentives offered to consumers and companies for adding and using alternative fuel vehicles. As a means of promoting the increased use of alternative fuels and vehicles in the transportation sector, Congress has supported and enacted certain tax incentives, including federal tax exemptions, credits and deductions. Based on U.S. Treasury Department's estimates, since the late 1970s, these tax incentives have resulted in forgone tax revenues of about $13 billion for alcohol fuels and about $600 million for clean-burning fuels and electric vehicles (United States General Accounting Office, 2001). However, these amounts comprise only a small share of the total transportation tax incentives over the years, much of which has been devoted to conventional fuels.

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From the standpoint of a rental car company, such incentives are more beneficial if they relate to traditional fuel vehicles. A review of the literature indicates that other incentives that have not yet been addressed may be more worth while. Science Daily (2007) notes that the importance of vehicle lifetime, providing incentives to scrap current vehicles may be more effective than direct efforts to get more alternative fuel vehicles on the road. In addition, Science Daily (2007) proposes that providing subsidies for building alternative fuel stations will help, but giving bonuses for building and especially keeping them in remote areas may be critical. Finally, for markets to reach the tipping point, policy incentives may have to be kept in place for many decades, even through periods of declining fuel prices.

Conclusion review of the literature indicates that the feasibility of adding alternative fuel vehicles is not reasonable for Lotus Car Rental. The main reason for this assessment is the fact that these vehicles are used only for a short period of time by the consumer, who just needs a car for a short-time. These consumers do not want to drive all over the place in search of an alternative fuel re-charge station. Furthermore, they are not concerned about the long-term affect of the vehicle or the cost of the vehicle, because they are not purchasing it themselves. Lotus Car Rental will not benefit from adding these vehicles to their fleet because their business depends on the demand of consumers for short-term use cars. Even government incentives do not provide enough reasons for the car rental facility to move away.....

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"Alternative Fuel For Lotus Alternative" (2007, November 19) Retrieved June 4, 2026, from
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