Defects in LED Lighting


In the wake of the restructuring of the U.S. Automobile enterprise, the U.S. Vehicle market is now dominated by using seven essential consolidated automobile businesses: General Motors, Ford, Chrysler/Fiat, Toyota, Lexus, Hyundai, and Honda. In unique, as the U.S. Brands recover, every is re-imaging itself as power green with the aid of using down all car fashions’ gas consumption and consolidating their number of dealerships. In the quest to reduce working fees these sellers are making an investment in centers that in shape their brand’s gasoline performance efforts.

To get an idea of the type of gasoline efficiency efforts U.S. Car manufacturers are making, bear in mind Ford’s new EcoBoost engine. According to garden flood lights Ford, the EcoBoost engine combines advanced direct injection technology and turbo-charging with a fuel engine. The give up result is an engine that may supply up to twenty % better gasoline financial system, 15 % lower CO2 emissions, and stepped forward riding overall performance while compared to larger displacement engines.

Car sellers are interested by each energy green indoor lighting and power efficient outside lot lighting. They are increasingly very relaxed with LED lighting fixtures generation because they have got witnessed it mainstream into vehicle headlight and taillight packages. LED’s are now mainstreaming into supplier showrooms and outside lots.

The Section 179D EPAct Tax Opportunities

Pursuant to Energy Policy Act (EPAct) Section 179D, automobile dealerships making qualifying strength-reducing investments in their new or current places can gain immediately tax deductions of as much as $1.80 in keeping with rectangular foot.

If the constructing venture doesn’t qualify for the maximum EPAct $1.80 consistent with square foot on the spot tax deduction, there are tax deductions of as much as $zero.60 per rectangular foot for every of the 3 fundamental constructing subsystems: lighting fixtures, HVAC (heating, ventilating, and aircon), and the constructing envelope. The building envelope is every item on the constructing’s exterior perimeter that touches the outside world inclusive of roof, walls, insulation, doorways, home windows and foundation.

Unique 2011 Opportunity: Enhanced Bonus Tax Depreciation

Outdoor lot lighting is broadly speaking eligible for MACRS depreciation, but constructing owners who deploy LED lights systems after September eight, 2010 thru December 31, 2011 can take 100% depreciation tax bonus right now. Even if constructing proprietors leave out this 2011 window, they are able to revel in a 50% tax depreciation bonus on gadget positioned in service from January 1, 2011 via December 31, 2012.

Outdoor Lot Lighting

Outdoor lot lighting fixtures is lighting that illuminates handiest the landscaping or constructing outside (however now not parking areas or walkways) in addition to plant-grow lighting fixtures, however which does now not relate to the operation or upkeep of the building. Outdoor lot lighting systems are commonly pole-set up or freestanding and serve to illuminate sidewalks, parking or exercise areas.

For the first time in U.S. Tax History, based on the bonus depreciation blessings described above, a hundred% of the price of an outdoor lights assignment can be expensed for tax functions.

Dealer Facility Restructuring at Ford, General Motors and Chrysler

With the overall number of U.S. Dealerships falling from greater than 30,000 to approximately 18,000, when income volumes recover each dealership will with the aid of definition must be a miles larger facility able to assisting higher sales and provider volumes. There is an common decline in U.S. Automobile sales during the last decade and a drop within the number of vehicle dealerships on the grounds that 1970.

When power efficient tax incentives were first enacted in 2005, overseas car sellers have been financially strong and targeted on dominating the market for small, efficient cars, which intended that it changed into mostly the overseas brands that have been making electricity efficient lighting fixtures upgrades to their dealership locations and taking advantage of the EPAct tax savings. For instance, Emich Volkswagen of Denver has set up LED lighting at some point of its new and used automobile dealership. The LED retrofit assignment decreased Emich VW’s lighting power use by almost 80% and the dealership will earn a go back on its investment in approximately 18 months based totally on electricity financial savings from its LED lights and conservation rebates presented by Xcel Energy and the City and County of Denver.

Because of their restructuring and the marketplace demand for more green cars due to the fact that 2008, American car manufacturers have observed their overseas counterparts’ lead.

Federal Lighting Bans

Dealerships that have no longer upgraded lighting fixtures inside the past 5 or greater years regularly have inefficient T-12 or steel halide lighting fixtures whose manufacturing or importation is now banned through the federal authorities. Therefore, subsequently those dealers will be pressured to improve to extra green lighting like T-5 and T-8 fluorescents, or the brand new rather green LED lights.

LED’s are up to 4 instances extra strength efficient than conventional incandescent bulbs, which means that that their potential to pressure down electricity running charges is twofold: electricity savings and their related tax savings.


Ford has shuttered its lengthy-standing Mercury logo. Accordingly, it has opted to consolidate sure Ford and Lincoln dealerships across the united states. Some solely mixed Lincoln-Mercury dealers experienced less gross sales extent than Ford best or mixed Ford-Lincoln dealerships. While there are many factors that encouraged Ford’s selection to cut back on the Mercury logo, what’s important is the effect a discounted quantity of manufacturers can have on Ford’s dealership method going forward.

Fewer brands in its portfolio, blended with its improving monetary scenario, will allow the automaker to awareness not handiest on product exceptional, but also on cost reductions across the board. Ford’s predicted annual running profit of about $eight billion would be its high-quality displaying due to the fact that a $10.2 billion earnings in 2000, whilst U.S. Enterprise auto sales have been 33 percent better. Earning better income at a decrease income quantity has been one of the keys to the business enterprise’s approach on the grounds that Chief Executive Alan Mulally arrived in October 2006. Indications are that that a number of the desired building improvements will range from $300,000 to $1,500,000 in step with dealership. Some sellers are balking at those figures, which may also result in extra closures unless sellers are receptive to the power and tax financial savings that come with greater efficient lights system. Upgrading to lengthy existence power LED lights is a manner to reduce ongoing working and maintenance prices.

General Motors

The biggest dealership facility discount has been at General Motors, which has slimmed itself right down to 4 brands, particularly Cadillac, Chevy, Buick and GM after jettisoning Oldsmobile, Pontiac, Saab, Saturn and Hummer. GM has launched the biggest and maximum giant re-imaging plan of the home car dealers. They sent inspectors to research all in their dealerships’ facilities attributes, inclusive of look, area and typical nice. Many dealerships that were lucky sufficient to not be terminated are now obligated to make main facility improvements.


Chrysler has merged with Fiat, giving Fiat a main U.S. Distribution network for its more gas-green product line. Recently pronounced dealer records indicated that the average Chrysler dealer’s pre-tax profits fell to $150,000 all through the economic downturn. This way that a $15,000 discount in facility electricity running fees equates to a 10% boom in pre-tax profits.

Dealers can integrate electricity green LED lighting fixtures with strength efficient HVAC in each the conditioned (air conditioned) and non-conditioned portions of the centers for $1.20 per square foot EPAct tax deductions.


The newly configured U.S. Vehicle enterprise is turning into an increasing number of centered on gasoline performance, each for vehicles and the dealership facilities. By upgrading indoor and outdoor lot lighting to LED’s, dealerships have the possibility to significantly reduce their energy expenses at the same time as figuring out substantial tax financial savings.

Charles R. Goulding , an lawyer and certified public accountant, is President of EnergyTaxSavers.Com.

Charles G. Goulding is an analyst with EnergyTaxSavers.Com.

Energy Tax Savers, Inc. Is an interdisciplinary tax and engineering firm that specializes within the strength efficient components of homes.