Press Release

Californians Against Hidden Taxes Decry Subsidies for Elite Electric Vehicles

12/09/96

Taxpayers Fuel Early Christmas for Elite Electric Cars


LOS ANGELES--(BUSINESS WIRE) -- For an elite few in the six-figure
income bracket, Christmas came early today as GM's shiny boutique
electric car, the EV-1, stormed into Hollywood fueled by taxpayer
subsidies from all over California and the rest of the nation.

"Those who can afford the luxury of driving an experimental electric
car with an estimated 90-mile range -- and a sticker price higher than
that of a BMW Z3 roadster -- found the road smoothed by as much as
$7,500 in rebates and tax credits courtesy of working folks who would
be hard-pressed to afford even the $13,000, 370-mile range Saturns
sharing the showroom floor with their more glamorous counterparts,"
said Anita Mangels, executive director of Californians Against Hidden
Taxes (CAHT).

"Even the EV-1's targeted customer -- describe by GM as `a 35-54
year-old male with as many as three other cars and a household income
of about $130,000' -- couldn't be counted on to sink Beverly Hills
bucks into a novelty buggy so temperamental that you have to call in a
specialist just to change a tire," according to Mangels.

Burnham Securities auto analyst David Healy told the Detroit News: The
EV-1 "is a rich man's toy. It's an expensive vehicle with the
equivalent of a two-gallon gas tank."

TV stars and entertainment industry executives were reportedly among
those to lay claim to the status of being the first on their blocks to
run errands in the $34,000 EV-1. Although most Americans would
consider themselves lucky to earn that amount in a year, it's arguably
less than the EV-1 crowd would make for just one episode of a TV
series. And Saturn of Ontario reserved an EV-1 for a customer who
spends much of his time at a country club and considers the car a toy
as much as transportation.

Although the multi-million dollar EV-1 marketing blitz touts the
vehicle's perceived air quality benefits, even the California Air
Resources Board admits that these cars will achieve only about one
percent of the emissions reductions required under the state's own
clean air plan.

Consumer Reports, in its September 1996 issue, reported that "electric
cars do surprisingly little to cut overall carbon-dioxide emissions
... but the same improvement could be readily achieved, at lower cost,
just by improving the efficiency of gas-burning cars."

According to CAHT's Anita Mangels, "Taxpayer advocates, business
groups and others throughout California are asking why taxpayers
should heavily subsidize a $34,000 novelty vehicle for the Hollywood
and country club elite, especially when it won't significantly reduce
smog.

"Shouldn't you be asking too?"

The EV-1 will be available for lease only, and will be offered
exclusively in Los Angeles and San Diego, California and Phoenix and
Tucson, Arizona through a total of 26 Saturn dealers. GM cites warm
climate, flat terrain and the vehicle's high price tag as reasons for
the geographic restrictions.

Californians Against Hidden Taxes is a statewide coalition whose
members include the Howard Jarvis Taxpayers Association, California
Manufacturers Association, Western States Petroleum Association,
National Tax Limitation Committee and the California Business
Alliance.