As my fellow blogger Sam pointed out recently, Darryl Siry, Vice President of Marketing for Tesla Motors, recently wrote on their site's blog that "The Media Need to Toughen Up on the Subject of EVs". This is true on many levels, and it could be argued that the media needs to toughen up when it comes to reporting in general. But, this is not the subject of this particular editorial. But, in the spirit of doing exactly what he asked the media to do, let's consider some of the hard questions facing hopeful electric vehicle manufacturers in the coming years.
Darryl mentioned, as did Tesla Motors CEO Martin Eberhard in Sam's interview, that Tesla perceives themselves as different than other new electric vehicle manufacturers. Indeed, they see themselves as more like GM, Ford, Toyota and Nissan. Are they? I am not sure, as they have yet to produce a single vehicle for public consumption, as compared to the almost too numerous to mention vehicles those other companies have sold. This begs the question, is Tesla getting ahead of themselves? Are they really competing directly with GM and Toyota?
Continue reading my thoughts after the break.
I hope not, as I would love to see them succeed. And, as a matter of fact, I do believe that they will, regardless of whether they are getting too far ahead of themselves at this point in time.
However, this next question also bears consideration. Is Telsa different than Phoenix Motorcars or ZAP? This too is unanswerable at this moment. ZAP may appear ahead of the game, as they already offer electric vehicles for sale. However, the vehicles that they offer currently do not compete in any meaningful way with what Tesla is cooking up. They have announced plans for vehicles that will compete with what Tesla plans to produce in the future. Next is Phoenix Motorcars. Their SUT has some pretty impressive specifications, due in part to their high-tech batteries. Martin Eberhard questioned their business strategy, as did Darryl. It has recently been reported that Phoenix is, or at least is planning on, selling their emissions credits to other manufacturers. Tesla is quick to point out that they too will have these credits, and had not included their sale into their business plans or strategy. Should they? I have no idea, to be honest. Here is the question on my mind, however. If Tesla makes money on each vehicle they sell, will they be willing to sell their credits to other companies, as Phoenix plans to do? Will they sell them for less money than Phoenix, thereby hurting Phoenix's bottom line? Again, I have no idea. Until vehicles are sold, it's just conjecture.
Lastly on that topic, is Phoenix Motorcars' business plan to make any sort of profit based solely on the sale of their credits? They have said that they plan to sell them, but have not exactly indicated that this will be their only source of profit. I imagine that anybody who has invested in Phoenix would not have done so with a horribly inadequate business plan, but, as I have no inside information to the contrary, I cannot say. It is certain, however, that AltairNano, the battery supplier, has a stake in the company, and PG&E has ordered a few trucks from them. Here's hoping that Phoenix, Tesla as well as ZAP have "all their ducks in a row", so to speak, and all turn out electric vehicles for our personal, green use.
So, with GM planning to produce an electric car, presumably the Volt, by 2010, Tesla planning on offering their "Whitestar" sedan by then, Phoenix Motorcars set to be producing SUT's and SUV's in full swing by that time, and ZAP planning to offer their multiple platforms, who will be the major players in the electric vehicle race? I, personally, can see Tesla hitting their goals. From what I have seen and heard, they truly appear to have a plan that holds water. ZAP has a head start, with a growing dealer network in place, and Lotus appears to have a hand in their designs. Discussions appear to be taking place with battery manufacturers, but they have shown no real prototypes. Phoenix has vehicles on the road now, and several people have driven them and reported on their experiences. This bodes well, as they at the very least can prove that their vehicles work as advertised. The question remains, will they be able to make money on them? Boy, I hope so. Fleet orders and limited production are one thing, when will they be ready to offer their products to end consumers? GM is a pretty safe bet, in this lowly bloggers mind. Say what you will about their taking and destroying the EV1 - they did make them in the first place. And they must have been good enough for some people, or else nobody would be upset with losing them. They have a great deal of capacity, more experience than any of the start-ups and have made public commitments. In some form, I expect to see their electric (or hybrid with the engine powering a generator, charging the batteries) vehicle on the road. The same monetary question still applies, however: Will they make any money on them?
What did I just say? Simply put, in my mind at least, here is the electric vehicle "pecking order" as it stands today. GM > Tesla > Phoenix > Zap. Some restrictions apply, and all that other good "fine print". Will another manufacturer step up to the plate? Toyota, Honda, Nissan... Ford? How about Mitsubishi? None have announced any specific plans to create electric cars for the public. ZENN hasn't shown us anything of substance yet, NEVs notwithstanding, so they have been left off this topic entirely. Anybody else?
Darryl Siry has said that he reads "just about every article that comes out each day on electric cars, alternative fuels, clean tech, and the automotive industry." I am not so secretly hoping that he reads this one, and would be so kind as to comment on these thoughts.
[Sources: Tesla, ZAP, Phoneix Motorcars and others]