Renting Bio Beetles: Hawaii's Clean Car Growth Industry

Last Updated Aug 20, 2010 6:46 PM EDT

Green car rental is a growth business, and mainstream companies such as Hertz and Enterprise have gotten into the lucrative (and environmentally friendly) membership offshoot called car sharing. Those services offer hybrids and other green cars, but only the long-established Bio Beetle company in Maui, Hawaii focuses on biodiesel vehicles.

The green approach has spurred steady growth, and the company's next move (thanks to a state stimulus-based grant program) is more of the same. The company plans to offer battery electric cars as soon as they're commercially available. It's part of broad push for EVs in Hawaii that is likely to include assembling them in the islands.

President Shaun Stenshol presides over a 20-car fleet that includes diesel-powered Beetles, Jettas, Golfs and a Jeep Liberty, plus some Toyota Prius hybrids, in the bustling central city of Kahului. The office, which doubles as a cat shelter and the headquarters of the recycling business Stenshol also runs, was busy on a recent weekday â€" 18 of Bio Beetle's cars were rented. Here, he talks about the company on video:
This is a business that caters to the tourists flocking to Maui, and Bio Beetle offers rates ($49.99 to $75 a day) that are on par with more established services. It also offers free pickups and drop-offs at the airport and popular tourist destinations. The company advertises 30 to 45 mpg from the 100 percent biodiesel it sources locally from Pacific Biodiesel. The "buy local" and "freedom from oil" pitches are a big part of Bio Beetle's appeal.

Stenshol, who relocated to Maui in 1998 and started his company in 2003 with a single diesel Beetle he found on a used car lot, has applied for a State of Hawaii grant to help him buy electric cars and set up charging stations. EVs, he says, will nicely complement his biodiesel cars, though he worries about the 100-mile range being a challenge.

The Hawaii program taps into $4 million in federal stimulus funds, and is available to residents who buy new EVs or chargers after August 1. Individual grants can be up to $4,500 for highway-capable cars and $500 for EV chargers (which average $2,000 installed).

According to Lieutenant Governor James Aiona, Jr., the EV program is part of Hawaii's stated goal of running on 70 percent clean energy by 2030. If so, the state has a fair way to go. Although Maui's 30-megawatt wind farm is a very visible symbol, and wind is a growth industry in Hawaii, the island gets only 10 percent of its electricity from that source now. Most power is run on expensive imported fuel oil. Gasoline is among the most expensive in the country in Hawaii, at over $4 a gallon for premium.

Hawaii is being very supportive of a plan by Korean automaker CT&T, which wants to build a plant on the islands to assemble as many as 10,000 EVs annually. The company recently met with Governor Linda Lingle, but it's unclear where the plant would be located. According to the Honolulu Advertiser, the country could have 10,000 EVs on the roads in five years.

Those high gas prices have created a business opportunity for entrepreneurs like David Noon, whose Maui EVs is a fast-growing conversion shop that's looking to ship cars all over the more populated islands (a $300 shipping fee makes that practical). Noon operates Maui's only broadcast television station, but he thinks EVs might be a more lucrative business in the long term. He's currently converting a Ford Ranger XLT pickup for a customer, and has a backlog of other vehicles awaiting battery installation (including a Mini, Hummer H2 and a 1950s Studebaker).

Stenshol briefly made his Bio Beetles available in Los Angeles circa 2006 and 2007, but it wasn't expanding fast enough, and operating remotely at such a distance proved difficult. Today, his growth plans are focused on the other islands, especially Oahu (which also has a biodiesel refinery) and the Big Island. Hawaii has a very green reputation, and businesses like Bio Beetle ensure that reputation is deserved.

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Photo: Jim Motavalli