Industry analysts say the $5 billion of taxpayer funds President Barack Obama put into a green car initiative was a risk that is not yielding predicted results.

During his 2008 campaign, Obama predicted green cars would create thousands of jobs in the United States as demand soared, but that has yet to happen, The Washington Post reported. Since then, about $5 billion has been put into the electric car industry, offering incentives to manufacturers, their suppliers and car buyers.

However, in recent months, the demand for green cars has dropped, forcing companies that manufacture them to scale back.

A123 Systems, a battery maker that received $380 million in government aid to create 3,000 jobs in Michigan, recently announced declining orders had forced the company to lay off many employees. Battery maker EnerDel, which received a $118 million federal grant, declared bankruptcy this year.

“Many in this industry have jumped the gun on how aggressive the growth of electric vehicles will be,” said Kevin C. See, an analyst at Lux Research.

Even with as much as $7,500 in stimulus tax credits for buyers, electric cars are far more expensive than their gas driven counter parts. Navistar, which received a $2.4 billion grant from the government to make electric trucks has reportedly only sold 100 trucks.

Sam Eitel’s Maryland car dealership had to sell its lot of the electric trucks back to Navistar after not selling a single one.

“People are scratching their heads saying, ‘How will we pay this???” Eitel said of the trucks that cost buyers $150,000.

Supporters of Obama’s green-car initiative say the investments will be worthwhile in the long run.

“Certainly, with electric-vehicle sales, we’re not on track to meet the president’s goal,” said Brendan Bell, clean-vehicle expert at the Union of Concerned Scientists. “But ... these investments are good ones toward that goal.”

Energy secretary Chris Huhne wants all cars and vans powered entirely by renewable energy
By Giles Sheldrick

All petrol and diesel vehicles will be removed from the roads as part of a controversial “green revolution” being drawn up by the Government, it was revealed last night.

Energy secretary Chris Huhne wants all cars and vans powered entirely by renewable energy.

But the move will cost Britain’s motorists tens of millions of pounds.

‘Green’ cars are prohibitively expensive, with some such as the Toyota Prius, which emit little carbon dioxide, costing 20,000 pounds.

Mr Huhne’s bold vision is set out in his carbon plan which details how Britain could slash greenhouse gas emissions by 80 per cent in 40 years. One of the cornerstones of his radical policy is to replace the 30 million cars and vans on Britain’s roads with battery-powered vehicles that can be recharged from low-carbon sources of electricity like wind farms by 2050.

The carbon plan is a road map for a new industrial revolution

Energy secretary Chris Huhne wants all cars and vans powered entirely by renewable energy. The plan could also see 32,000 wind turbines built in the rush to meet strict green targets and power a mass electrification of the transport system and domestic heating.

Mr Huhne said: “The carbon plan is a road map for a new industrial revolution in which low-carbon electricity powers the economy and protects us from reliance on imports from volatile parts of the world.”

Motoring analyst Alexander Wells warned: “It’s not just about putting battery-powered cars on the road - you need the infrastructure to fuel, service and repair them which doesn’t fully exist yet.”

Meanwhile, last night it emerged Britain has spent 600million trying to promote green technologies in Third World countries since 2006.