Jack Hidary´s Cash for Clunkers: $1bn only lasts a week.

Yesterday I spent half a day at Jack Hidary´s office in Midtown Manhattan. While the visit was mainly focused on Global Solar Center, his new company, I happened to be there when Jack got the news that the Cash for Clunkers Bill that he had sponsored in Congress through his not for profit called Smart Transportation had reached its 3 months goals to give out $1bn in incentives to buy more fuel efficient cars in only one week. Jack Hidary himself tells the story in an article in the Huffington Post this morning . The Cash for Clunkers story is a remarkable example of what a motivated and well connected citizen can do to promote change in America in an area where USA is the world´s laggard. It is also a story of an administration, the Obama administration, and a Congress, that is willing to listen to the best ideas of their citizens, especially when proven elsewhere in the world. This is a welcome change after the Bush Administration who took pride in its go at it alone global policies. In Jack´s case we are talking about a simple idea, already used in Germany, of giving a cash incentive to people to trade in their old, highly inefficient cars for new cars with much better MPG standards. According to Jack, there were many people in government who thought that the program would not be very successful, that the cash incentives were small and that as usual the government was going to be a poor communicator of its strategy. But what Jack successfully argued to politicians and turned out to be true is that if you leave it to car dealers, the cash for clunkers story would be told by the most powerful advertising machine in USA. And that´s what happened. Until yesterday you could not turn the TV in the States without watching some ad of some car dealer offering you the cash for clunkers program. That is how the $1bn that the government had allocated between this week and November ran out in a week. It is also worth noting that the old cars are not being sent to LDC as it usually happens with the export of used cars. They are being recycled into more efficient cars. Now the challenge is that tons of people were left out of the program. Will the American government be able to shut down a program that so efficiently allocates funds to reduce oil consumption and helps the car industry? My bet is that somehow more money will be found for it.

Now what is Jack´s next challenge? To convince Americans to save energy in another major way: installing solar panels in their homes. For that purpose he created Global Solar Center. Global Solar Center is as he puts it the “Salesforce.com of the solar energy industry”. After spending time with Saleforce founder Marc Benioff in Hawaii last week I can say that Jack is on to something there. What Salesforce.com did to provide an online alternative to Oracle and SAP software package products Jack may do for the Solar Energy Industry. The Solar Energy industry suffers from a chicken and egg problem. How do you communicate to the American people that there are billions of dollars of government incentives available for them to generate their own electricity when installation benefits vary so widely among home owners? Jack´s answer is the creation of an online tool that is available for everyone on the internet and gives home owners a free and quick answer, something that until now required visits from solar panel installers and studies that could cost in the thousands. This tool, which was recently launched, combines the power of many mapping and photographic databases coming from Google (maps) and Bing (pictures), with precise information of USA´s solar footprint to give solar panel installers and the average citizen a quick answer as to how much it would cost to install solar in her/his home, what programs are available to subsidize the installation and the return on investment. While his results have not yet been as impressive as Cash for Clunkers, probably because solar panel dealers are poorly organized and have not managed to communicate the government incentives available to them as well as the car dealer industry, Jack has managed to generate $6 million worth of orders obtaining a 3% commission on each one in a few weeks. So as opposed to his efforts in Smart Transportation an NGO Global Solar Center is a for profit company and may actually be one of those rare companies that both do good and make money.