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Discussion Starter #1 (Edited)
Note: I'm in the US, so this may not fully reflect other countries:
Background to idea:
  • a large percentage (what percentage?) of new and used vehicle purchases are, in effect, made by banks until such time as the loans are paid off.
  • Banks seem to be still fine to finance the purchase of fossil fuel vehicles, and do not seem to be particularly emphasizing that they would instead prefer to finance the purchase of battery electric vehicles.
  • As to the financing of the building of fossil fuel vehicle manufacturing capacity, or the financing of fossil fuel production, refining, distribution, sale, .... I'm not familiar with how that is usually organized, but I'm penciling in that some banks and other financial industry institutions may be ok to lend or help establish financial instruments for this.
  • Fossil Fuel Equity Divestment appears to be a rising and respected force, though not all-powerful, but I have not heard anything from divestment thought-leaders (I don't follow that closely, maybe I have just missed it) about divestment from equity in those banks or other entities which continue to finance production and sale of fossil fuel vehicles, or production and sale of the high-carbon fossil fuels.
  • Maybe I just am not aware, but I also am not sure if we have heard anything yet from regulators and policy-makers as to regulating entities which continue to enable financing of fossil fuels and fossil fuel vehicles.
  • In order to facilitate consideration of divestment, accurate data is needed as to banks and any other entities which are involved with financing production and sale of fossil fuel vehicles. For example, the percentage of a bank's auto loan portfolio that is fossil fuel versus PHEV versus BEV would be key information.
The idea:
So, the idea is to start accelerating shining light on, and putting real pressure on, banks and any other financial industry entities which help finance fossil fuels or fossil fuel vehicles, in any way. This light and pressure includes establishing difficult-but-achievable goals (that are designed to change over time and move toward zero-carbon vehicle loan portfolios and manufacturing facility loans by 2025-2035 or so) that all such entities should be expected to achieve, to publish these goals, to expect transparent data on these goals from the entities themselves and from 3rd party data providers, to engage in divestment of those public equities that fail to meet these goals or criteria, and to engage in public policies that can supplement and fill gaps where divestment efforts fall short.

Note:
The idea is around zero-carbon solutions, not just "BEV". So, it can accommodate some reasonable approach to FCV (keeping in mind that electricity, hydrogen and other fuels must not be fossil-fuel derived). In theory it could accommodate a true zero-carbon sustainable drop-in fuel replacement for combustion engines, but I haven't seen much indication of anyone coming forward with this, and time is short, so I have not tried to put the idea in that particular direction.

[Edit/addendum]
[One policy measure that is suggested within this idea is to lay out for banks achievable goals as to improving their auto loan portfolios, and then to fine the banks if they fail to meet those goals (similar to CAFE standards and fines imposed on automakers). ]

[Also noting within this addendum that the idea here is global, not US-centric. I don't know as much about the world outside the US, but the idea overall is to see if we can do more to dry up and stop finance around the world for any production, sale or operation of the vehicles which are designed to burn fossil fuels, along with finance for all aspects of fossil fuel mining, refining and sale,... all while encouraging finance for the most realistic and viable alternatives.]
 

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I agree that while the banks could be more pro-active in encouraging what they support (such as a reduced interest rate for BEV acquisition), the cynic in me says that they are only in business to make money and are not particularly ethically driven.

Added to which, as long as you have an administration that denies climate change and actively supports fossil industries, you are on a hiding to nothing (not sure if that is just a British expression - it means you can't win). I do understand that some progressive states like California are taking matters into their own hands, though.
 

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Discussion Starter #3
I agree that while the banks could be more pro-active in encouraging what they support (such as a reduced interest rate for BEV acquisition), the cynic in me says that they are only in business to make money and are not particularly ethically driven.

Added to which, as long as you have an administration that denies climate change and actively supports fossil industries, you are on a hiding to nothing (not sure if that is just a British expression - it means you can't win). I do understand that some progressive states like California are taking matters into their own hands, though.
Thanks for your points here.

I do agree that there is not much point in counting on businesses to define and do what some of us are calling the "right" moral thing, but that is kind of why I put forth my idea - because we cannot wait for that, we must (I think) incentivize it.

I agree the present US federal-level Administration will not agree to any such policy idea, though the idea applies outside of policy as well, to investing and (specifically) fossil fuel equity divestment/activism. I did amend the initial post to reflect more of a global approach to the matter. Basically, we (all people on Earth) should I think be taking prudent measures to dry up and eliminate financing for fossil fuel extraction/refining/use and to increase financing for alternatives.
 

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Discussion Starter #4
Adding something further to the ideas for drying up financing for production and sale of fossil fueled vehicles:

I suggest that state and federal policy-makers consider insurance industry regulations which will slightly reduce payouts on totaled vehicles unless the vehicle is replaced with a comparable full battery electric vehicle. Over time make the reductions more substantial.
 

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  • Fossil Fuel Equity Divestment appears to be a rising and respected force, though not all-powerful, but I have not heard anything from divestment thought-leaders (I don't follow that closely, maybe I have just missed it) about divestment from equity in those banks or other entities which continue to finance production and sale of fossil fuel vehicles, or production and sale of the high-carbon fossil fuels.
I manage my own pension investments and try hard to keep fossil fuel content down below 5%. The problem is a simple one though - if you divest then you force the share price down (at least if people divest in large numbers, or large funds divest) which makes the dividend rise as a % of the price. Most oil companies are now paying large dividends, making them a very attractive investment for income.
 

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Discussion Starter #7
or add 5% tax onto any pcp deal for non ev
but in reality all that will do is push people into getting personal loans
I wasn't familiar with pcp, but I get the gist of it from a link or two around the net. I think if the goal is to dry up financing of ffvs and encourage financing of BEVs, then yes, some sort of 5% tax on a pcp might make sense. I don't know about "personal loans". Are these collateralized auto loans that one could then in theory commiserate with and regulate the lenders so they would start discouraging loans for purchase of ffvs? Or are they unrelated to the item being purchased and thus harder to regulate in this way?
 

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Discussion Starter #8
I manage my own pension investments and try hard to keep fossil fuel content down below 5%. The problem is a simple one though - if you divest then you force the share price down (at least if people divest in large numbers, or large funds divest) which makes the dividend rise as a % of the price. Most oil companies are now paying large dividends, making them a very attractive investment for income.
Yes, I do think you have it right, even if one divests of the things one regards as bad, there is some legitimate question of how much good that does, if any. Do the divested companies care? Even if it's very large pools of money that divest, aren't there others willing to take up the mantle and get a good buy? But I think there's a limit to that "musical chairs" aspect of buying into the listed companies that nobody else wants, and in the end, maybe there is at least some value to divestment? Well, I think it's at least a legit question.

More to the point though, in addition to the investment community sending a clear signal to banks that they will no longer invest in fossil-fuel-mania, I think at the same time, regulators/policy-makers should step in and start regulating lenders who make loans for the purchase of ffvs. In the US I see the bank in effect as the owner of the vehicle until the loan is paid off. If a loan is needed, then without the say-so of the bank, the vehicle does not get purchased. So, the banks making that powerful decision need to be met with clear guidance and firm regulation that their financing of purchase of millions of ffvs will be phased out over the coming years. If there is an argument that "divestment" is in some ways toothless, or incomplete, as a means of bringing about change, then the other part of the idea - to bring in firm regulation, is I think a way of reducing or eliminating loopholes and keeping the pressure on.
 

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The idea:
So, the idea is to start accelerating shining light on, and putting real pressure on, banks and any other financial industry entities which help finance fossil fuels or fossil fuel vehicles, in any way.

This light and pressure includes establishing difficult-but-achievable goals (that are designed to change over time and move toward zero-carbon vehicle loan portfolios and manufacturing facility loans by 2025-2035 or so) that all such entities should be expected to achieve, to publish these goals, to expect transparent data on these goals from the entities themselves and from 3rd party data providers, to engage in divestment of those public equities that fail to meet these goals or criteria, and to engage in public policies that can supplement and fill gaps where divestment efforts fall short.
Sorry, you have stated an ambition there, not an 'idea'.

Is your idea to bring Government legislation to bear on banks to do this? Don't they already do this by offering incentives? Govs are splashing out thousands of bucks into new cars, so if the banks are buying these, with incentives, they are buying into a lot of cheap cars and have assets on their books worth relatively much more than they paid?

Is your idea to bring public pressure to bear on banks? Heh. That usually works, doesn't it?! [/sarc]

I can't see any 'actions' coming out of this little meeting. Who, are you saying, does what?
 

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I manage my own pension investments and try hard to keep fossil fuel content down below 5%. The problem is a simple one though - if you divest then you force the share price down (at least if people divest in large numbers, or large funds divest) which makes the dividend rise as a % of the price. Most oil companies are now paying large dividends, making them a very attractive investment for income.
That can only last so long, at some point the bubble will burst, most analyses I've seen say the dividends are unsustainable.
I've invested in what is called "alternative" energy" but will shortly be mainstream there are many funds/ETFs/ITs that are focussed on this area.
 

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Discussion Starter #12 (Edited)
Sorry, you have stated an ambition there, not an 'idea'.

Is your idea to bring Government legislation to bear on banks to do this? Don't they already do this by offering incentives? Govs are splashing out thousands of bucks into new cars, so if the banks are buying these, with incentives, they are buying into a lot of cheap cars and have assets on their books worth relatively much more than they paid?

Is your idea to bring public pressure to bear on banks? Heh. That usually works, doesn't it?! [/sarc]

I can't see any 'actions' coming out of this little meeting. Who, are you saying, does what?
The goal is to dry up financing, once and for all, for fossil fuel exploration, mining, refining, distribution, and (particularly) burning it in fossil fuel burning vehicles. The goal includes focusing on, reducing, and eliminating the creation and distribution and support for fossil fuel burning vehicles around the world. Some of this is already being done

(see, for example):
European Investment Bank to cease funding fossil fuel projects
15 November 2019)

and some of this is not so much about directly drying up financing as simply banning the technology (such as here):

(I sometimes think that bans are simply infinitely high Taxes, sometimes placed by folks that don't want to use the "T" word, and so I guess you could call it a way of drying up financing, but it's not that important here either way).

One way or another, we are hopefully going to see an addressing of carbon matters within the next few decades, as this has emerged as a life and death matter for millions, if not billions, and it seems likely this will include a dramatic reduction in, or full elimination of, fossil fuel use. However, in looking at the amount of time it is taking to curtail fossil fuel vehicle proliferation, and to curtail oil mining, it has seemed to me that there are some policy (regulatory) measures here that have not yet been taken.... essentially loopholes in how some of us advocates have been approaching the matter. So, the overall idea is to focus on addressing these holes, and thus accelerate the move away from fossil fuels.

As to some specifics, I have already mentioned, but to review:

- a government schedule for assessing and increasing fines on banks which fail to maintain a pace of transitioning their vehicle loan portfolios to BEV. This would be analagous to the fines on automakers we have in the US under the Corporate Average Fuel Economy ("CAFE") regulations. There could also be incentives I guess for maintaining particularly good transitional numbers in the loan portfolios, but this seems to me less important than suggesting fines for failing to move adequately quickly.

- fines or other regulatory or industry measures to discourage any further financing of ffv vehicle manufacturing or fossil fuel mining/refining/exploration/distribution.

- fines on insurance companies and/or their customers for replacement of FFVs with FFVs instead of BEVs.

- in parallel with this, I think that advocacy within the investment community should take the form of including the worst banks in their equity divestment considerations.

- as a practical matter, it will be necessary to develop improved transparency as to bank auto lending for FFVs and BEVs, and toward this end, the idea is to develop fields on this within the financial community. This can take place simply from within the financial data industry, it can be encouraged from government (such as in SEC regulations or others that might require certain types of disclosure) and it can be addressed through such organizations of stakeholders such as the Task Force on Climate Related Financial Disclosures.

Recently I finally saw the movie "The Big Short" and it was quite an experience in my view. Innovation and going against conventional wisdom within the financial and trading world is not that easy sometimes, and I thought that was one of the points well made in the film. Another was to really shine a light on some of the destruction caused by cavalier and irresponsible behavior at some banks. It is with this partly in mind that I have formulated my idea. For those of us interested to try to accelerate deployment of EVs (and I don't know if that includes you or not) let's take a look at whether banks making so many auto loans ought to be more strongly regulated in this area such that they have a disincentive to make those loans on ffvs, and have some reasonable incentive to make those loans on good BEVs. If my ideas for the mechanics of how to do this are not sound, perhaps there is someone, perhaps with more knowledge than I have of banking and auto loans, who can jump in and propose better ideas.
 

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The goal is to dry up financing, once and for all, for fossil fuel exploration, mining, refining, distribution, and (particularly) burning it in fossil fuel burning vehicles. The goal includes focusing on, reducing, and eliminating the creation and distribution and support for fossil fuel burning vehicles around the world. ....

As to some specifics, I have already mentioned, but to review:
....
It's still not an 'idea'. You are yet again stating an 'ambition'.

Just write a few lines, the first few words of each describe 'who' you think needs to do something, the next few words describe 'what' they are going to do, then 'why' and finally the 'measurable objective' as to whether they have succeeded.

Unless you have those thing, it is not an 'idea'.

For example;

Bank bosses should not allow branches to authorise loans for ICE cars, because [....fill this in, I can't see why they would do this....] and the result is all ICE car loans have to be on a quota controlled by the head office.

Something like that.

TBH, I can't imagine a single line you are going to be able to write out like that, with all the blanks filled out.
 

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Discussion Starter #14 (Edited)
It's still not an 'idea'. You are yet again stating an 'ambition'.

Just write a few lines, the first few words of each describe 'who' you think needs to do something, the next few words describe 'what' they are going to do, then 'why' and finally the 'measurable objective' as to whether they have succeeded.

Unless you have those thing, it is not an 'idea'.

For example;

Bank bosses should not allow branches to authorise loans for ICE cars, because [....fill this in, I can't see why they would do this....] and the result is all ICE car loans have to be on a quota controlled by the head office.

Something like that.

TBH, I can't imagine a single line you are going to be able to write out like that, with all the blanks filled out.
Thanks Donald, but the idea here is a policy and investment one, not a private business idea for how banks should go about things internally. I have spelled out enough of an outline as to what I think regulators, investors and information providers should do. You have more than once ignored that I have gone to some lengths to spell these out, and at some cost to my time.

If you think the point should be to look at it as well from a bank internal behavior point of view, and thus better refine proposed regulation and such, that may not be a bad point, but, even if that's your intention, you seem to me be deliberately obscuring it behind some pettiness.

Put it this way, do you have a response to the idea (or ambition, if you are unable to call it an idea) of applying a CAFE-type of regulation to a bank's loan portfolio? Perhaps it's your view that you have already given your response.
 

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Thanks Donald, but the idea here is a policy and investment one, not a private business idea for how banks should go about things internally. I have spelled out enough of an outline as to what I think regulators, investors and information providers should do. You have more than once ignored that I have gone to some lengths to spell these out, and at some cost to my time.
I am not ignoring with you in the slightest, that's silly. I am engaging with you.

I am saying that you have not set any clarity to who does what.

What does 'regulators' mean?

'Investors' .. why would an investors lift the slightest finger to your 'idea'? Say what they are to do and why they should do it?

I am a small time investor for my pension pot which is dispersed in an array of private equities, amongst other things. If I think a company that trades solely in ICE vehicles is going to do well, I will invest in it. Whether I think your 'idea' is founded on good ethical ambitions or not, I am going to ignore your idea because a) it is not illegal to do so, b) I need to try to make my pension pot as big as I can in these uncertain times, c) it is not my business to prevent them from trading.

So, in this situation, for example, your idea is nothing, nada, zero, it has no impact on me as an 'investor'. For this to be an 'idea' something has to come out of it. What, in your 'idea', can get something out of me as an investor? If the answer is 'nothing' then it is a 'day-dream' not an idea'.

I am afraid you have no idea, just a vision.

What do you want to happen next? You have called this meeting of the entire planet, on the internet, to discuss your idea. This has now been discussed. The meeting is closing. What are your minutes of this meeting; who has 'actions' against them to do something, and why should they bother?
 

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You have more than once ignored that I have gone to some lengths to spell these out, and at some cost to my time.
You know what, I haven't spent any time on this, I have just wasted it.

Of ~22,000 members on this forum, I am one of just a few that bothered to respond and of those I have written the most.

In some way you have translated this into 'ignoring' you. You haven't held that criticism of the other ~21,999 members.

Fine. Bye. Whoever it is that you are trying to persuade, whatever that is, good luck with that. What you have said is nothing that has any bearing on what I could or would do, so it is irrelevant.

I was just wondering if you wanted me to write to my MP to get them to put something forward, or something like that, but this doesn't seem to be what you want me to do, there's nothing you've asked of me, so I'm outta here.
 

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Discussion Starter #17
You know what, I haven't spent any time on this, I have just wasted it.

Of ~22,000 members on this forum, I am one of just a few that bothered to respond and of those I have written the most.

In some way you have translated this into 'ignoring' you. You haven't held that criticism of the other ~21,999 members.

Fine. Bye. Whoever it is that you are trying to persuade, whatever that is, good luck with that. What you have said is nothing that has any bearing on what I could or would do, so it is irrelevant.

I was just wondering if you wanted me to write to my MP to get them to put something forward, or something like that, but this doesn't seem to be what you want me to do, there's nothing you've asked of me, so I'm outta here.
Over the years I have found it useful to get feedback and develop ideas in forums such as this, but I also am pursuing developing this idea in more than one discussion area, and on more than one front, including at work. I have also received some decent feedback points here from others, and if I consider yours, probably I can take away one or two productive points.

On the investment front, the global fossil fuel equity divestment movement is, from what I have read, just about the biggest divestment movement in history. The point on that front was, and is, that their criteria for divestment oddly don't include the banks facilitating the purchase of gas guzzlers, and so to suggest to them that they include those banks for divestment consideration. It's unfortunate you find this too vague and need to try to call it "not an idea" but it seems to me like a bit of an idea. One can point out that many people don't care to have anything to do with divestment, but the fact is that some people do. On that side of things, this thread is relevant to those who do.

Toward this end of divesting of banks that are particularly bad about continuing to facilitate purchase of ffvs, information is needed, and so I have made a specific suggestion of developing some improved transparency on their loan portfolios. It may be a mountain to climb to research and find and disseminate accurate information in this area, but it will take some time to look into this.

As to what I have suggested regulators should do, I've made at least two broad suggestions (application of CAFE style mpg requirements and fines to bank loan portfolios, and requiring that insurance payouts not be complete if they are to finance replacement of totaled vehicles with comparable ffvs). Yes, these statements are short on specifics, but it is meant to be more the start of a conversation than some magic prescription for accelerating things.

Side-notes:

1) a month ago I drove to a one-day get-together in my state of electric vehicle industry stakeholders, government officials, drivers and advocates. It was I think well-run. At one point I participated in an exercise amongst stakeholders and others to develop some ideas for improving our state's EV-related policies and laws. I found this kind of thought-provoking, and when I got home, I decided to flesh out some of my ideas. So, that's how this came about.

2) In a sense, this whole idea is arguably not that important since it seems we don't have that much longer to wait for the the major automakers to get their acts in gear, so whether the banks are pressured in better ways may to a degree be a bit after-the-fact, but maybe it is still worth it to try.

3) Sometimes I think it's necessary on the internet in forums such as this, when the topic may pertain to our work, that we are somewhat guarded in our comments. I'm not sure, but this may contribute to some of what you have perceived as my vagueness.

Anyway, it's unfortunate you found my ideas to be bad or vague or not ideas at all, in your view, but c'est la vie.
 
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