Among the moves aimed at revving up the niche: Automakers have bought production plants, firms have invested heavily in battery makers, charging stations are going up and PR efforts are in full swing.
November 17, 2010|By Tiffany Hsu, Los Angeles Times
Battery-powered vehicles are about to start rolling into U.S. dealerships, and a sprawling industry is springing up to gain a foothold in what many hope will be a lucrative new niche.
In four years, the North American market for electric vehicles is expected to more than double to $20 billion as alternative-fuel vehicles make up nearly 10% of all new-car sales in the U.S., according to separate studies by research company SBI Energy and J.D. Power & Associates.
“Clearly, we’ve come a long way,” said Jordan Ramer, chief executive of charging infrastructure company EV Connect. “But everyone realizes that for this to be successful, there needs to be collaboration. And we’re all making sure to work in unison and play nice.”
California is looking at leading the movement and expects to have 1 million electric and plug-in hybrid vehicles on the road by 2020. The U.S. Senate could help. It’s considering a bill that would pump $3.6 billion in federal funding to the electric vehicle industry.
To stimulate the market, General Electric Co. said last week that it plans to purchase 25,000 electric vehicles for itself and its fleet customers by 2015, including 12,000 Volts.
Manufacturers are snapping up auto plants: Fisker Automotive Inc. of Irvine shelled out $20 million for a closed GM assembly facility in Delaware, where it plans to build its $47,000 Nina plug-in hybrid. Tesla Motors Inc. of Palo Alto will soon start work in a previously shuttered Fremont, Calif., factory where it will build cars including the Model S sedan.
All this activity is going to create a boomlet for companies supplying the industry. Pike Research estimates that the electric vehicle supply business will become a $1.5-billion industry by 2015. The Copper Development Assn. recently said that electric cars would use triple the amount of the metal compared with conventional cars — nearly 200 pounds per vehicle.
Companies are investing heavily in battery technology. GM and Itochu Corp. poured $4.2 million in battery developer Sakti3 Inc. of Ann Arbor, Mich. Thirty new manufacturing plants focusing on batteries and related components are planned for the next two years, according to the U.S. Energy Department.
With that kind of money in play, an armada of public relations efforts have launched to make electric vehicles seem more palatable — even sexy — to skeptical consumers.
Nissan Motor Co. has launched television ads for the Leaf featuring a cuddly polar bear. Hotels and retailers such as Best Buy Co. plan to test out charging options at stores. FedEx Corp. sent several all-electric trucks into rotation in Los Angeles over the summer. Radical Sportscars Ltd. is showing off its SRZero electric race car by sending it on a trek from Alaska to Argentina.
But not everyone is enamored. Radio personality Rush Limbaugh attacked electric cars as something he “can’t in good conscience recommend,” saying they don’t make economic sense.
Others have lingering doubts as well, saying electric cars are only eco-friendly up to a point.
In California, gas-powered cars produce more than 450 grams of carbon dioxide per mile while electric cars emit less than 150 grams, according to several estimates. But the vehicles still have to draw power from an electricity grid, which often derives energy from emissions-heavy sources such as coal.
Some cities in California are planning to try out chargers powered by renewable energy. And GM is installing solar-powered charging stations from Envision Solar International Inc. in preparation for the release of its Volt vehicle.
Officials are also flummoxed by warnings from some manufacturers, including Tesla, that advertised miles-per-charge could fluctuate based on weather conditions, driving speed and other factors. The Environmental Protection Agency is still struggling to set standards for testing electric vehicles and establishing mileage.
That has left potential customers suffering a serious case of range anxiety as they worry about their cars running out of juice in mid-drive.
So the electric vehicle rollout is being preceded by intense infrastructure planning to ensure that public and residential chargers are readily available.
In the next six months, several thousand public charging stations will be installed in California, said Paul Scott, a founding member of advocacy group Plug In America.
“The good news is that everybody has the same mission of mass adoption eventually,” said Jason Wolf, vice president of charger infrastructure company Better Place. “But it’s a long process. We have to make not just the car, but the entire electric vehicle ecosystem competitive with that of the gasoline car.”