• Sep 28th 2009 at 9:18AM
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We are all familiar with the technical issues facing the developers of electric cars, namely energy density and durability. However, the biggest problem likely to affect the mainstream adoption of EVs is cost. In many respects EVs, are mechanically simpler than ICE cars and should be cheaper to build. However, batteries are not cheap, especially lithium ion, and it's not clear when the price will come down.

Shai Agassi is betting the farm on widespread use of electric transportation by building networks of charging stations and battery swap stations. Speaking in Germany, Agassi is claiming that electric cars will be cheaper for consumers to buy than internal combustion equivalents. Up to a point, Agassi is accurate. Sort of. The only way that EVs will be cheaper in the short run is by not including the cost of the battery and leasing them separately for €250-350 per month. In a sense, this is like selling an ICE car without a fuel tank (an expensive one) and leasing that separately. The other element that drives down the "apparent cost" is government incentives for EVs. Of course, this too is a fallacy, since we are paying for that in taxes.

Agassi also points out that the battery lease cost will be comparable to the cost of fueling an ICE vehicle. That is only true in Europe where higher fuel taxes keep pump prices elevated. Here in the U.S., regular gas is only $2.50 per gallon and the numbers simply don't add up.

[Source: Reuters]

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    • 1 Second Ago
      • 5 Years Ago
      Oil from a nuclear armed, highly volatile country or carbon fiber batteries from the most capitalist, low-waged country in the world - which will be cheaper in 2- 5 yrs?
      • 6 Years Ago
      If you lease the battery then you better sell the shell as I like to call it really cheap. The problem is that a lot of people now can pick up a small fuel efficent car for about 10k, so telling these people that you need to pay an extra 10k + 300 a month to lease the battery is a no sale.

      You need to provide a complete lease of the car at a good price, or sell the shell really really cheap, i think under 10k for small models then work out a decent lease package.

      I spend about 2000 euro per year on my car (not including depreciation), so if I can get a car that costs me about 3k per year on lease, then I am willing to buy it.
      • 6 Years Ago
      Any new disruptive technology is going to be more expensive at first. For every case, the solution is to start with the *early adopters*, make them happy customers and then move to a larger group so you don't run out of customers. It worked for the iPhone & for Twitter & in fact for the personal computer when they were first introduced.

      Even if Better Place's business doesn't work out, Shai Agassi has made many politicians and public administrators into *early adopters*, just waiting for the first few cars to appear. That's exactly what EVs need.
        • 6 Years Ago

        I'm sorry you think I was trolling, but I was responding to Nick's post. I thought he made a very good point about early adopters often paying higher cost, and I pointed out that the exact same thing is happening on the Hydrogen side of the fence.

        I didn't want to start a debate, so I will ignore the rest of your questions.

        I did comment about battery swapping, which I feel is crucial for BEVs. They're going to have be replaced at some point, so why not just design them to be easily replaced at the outset?

        • 6 Years Ago
        To be fair, a lot of us BEV guys post in hydrogen articles. I try to keep my comments on topic in general, but the trend I usually see is some negative comments on hydrogen, then it degrades into a full blown argument of plug-ins vs hydrogen. It is fun sometimes to debate, but in general there is just too many unknowns for both options that it doesn't really end up conclusive given we can't tell the future (which is why I'm always saying for both types to go to market as quickly as possible rather then staying in development). I don't think it is trolling, since in general the people making the comments aren't doing it for the purpose of getting a reaction (which is what a troll does), but rather that they actually want to say what they are saying.

        Back on topic. I still have doubts that Better Place can make the economics work out, but if they can, then it might be an attractive option for a lot of buyers.
        • 6 Years Ago
        @Letstakeawalk: If you're *not* trying to start a hydrogen debate, why exactly are you posting about H2 fuel cell vehicles in a thread that has absolutely nothing to do with it?

        I have a different theory. You're a troll.

        But hey, I'll bite. What are your thoughts on hydrogen that costs equivalent to $6 a gallon for gasoline? And that's wholesale. And on top of that, it's using the cheapest possible method of hydrogen production that is at least as bad for the environment as gasoline is. If you're going to reform natural gas into hydrogen, you're way better off just burning it in the engine, not only from an environmental standpoint, but from a logistical one too. It's far easier and cheaper getting propane into the tanks of cars than it is to get hydrogen there. If you actually want to produce hydrogen in a way that it would *not* harm the environment (which *is* its promise, after all), then the cost is about 10-20 times the natural gas reformation route. Practically noone produces commercial hydrogen that way.

        Really, who cares if the cost of fuel cells are coming down, when the price of the fuel will be several times more expensive than gasoline? You want to post in a thread about the cost of batteries when hydrogen is insurmountably expensive? Get real.
        • 6 Years Ago
        Hydrogen powered cars are making the transition you describe. Honda, GM, BMW, Mercedes, and Toyota all have fleets of hydrogen-powered cars that are being leased to early adopters who are able to provide feedback to the makers as well as gain press attention:




        I know a lot of BEV fans dislike fuel cells; I'm trying to start a debate regarding pros or cons. Nick from Montreal is absolutely correct in stating that new tech will be very expensive, and that early adopters are vital in shaping the public's perception of new technologies.

        IMHO, battery swapping is vital for BEVs. A swappable battery could be easily upgraded, and it would force the makers to use a standard size/shape format. Heck, even a fuel cell could be designed to swap into and use the same connections as a battery, which would create even more flexibility in the EV market!
        • 6 Years Ago
        Whoops. That should read:

        "...I'm *not* trying to start a debate..."

        'cause I'm not!
      • 6 Years Ago
      Shai Agassi is a conman. His agenda is to make electric cars fall into a business model that favours the corporations over individuals. To make something that should be cheap, pratical and durable into something expensive, obtrusive and with programmed obsolescence (in the battery lifetime).

      This is just an expression of the oligopoly trying to take control of electric transportation through biased technology and needs to be denounced for it.
      • 5 Years Ago
      As usual, the analysis is limited to the point of sale cost to the consumer and not the true full cost.

      The western world's prosperity gap over 'the rest' is due to its ability to exploit resources for 100+ years without regard for the full cost. It's time to start looking at ways to change that, this is just one idea and we shouldn't immediately put the blinders on when confronted with change and reality.

      If you look at the Better Place model and compare it to the current model, the current model is completely absurd. We only accept it because it's what we're used to.
      • 6 Years Ago
      Forgetaboutit. Even in Europe more economical ICE's will be the norm, except for "sponsored" niches.
      • 5 Years Ago
      Car companies need to hit home no tune ups, no oil changes, no transmissions or clutches to replace, engine coolant, blown radiator, rusty rattling mufflers, etc. That long term cheaper cost of ownership will also play a role in influencing the higher up front cost.
        • 5 Years Ago
        You make a very valid point, but the typical consumer is much more concerned about up-front costs vs. total-lifespan costs. Sad but true.

        People buy plastic disposable electronics all the time, knowing that when the motor that spins the DVD breaks, there will be a better, cheaper player available. The same thinking goes into major appliances, TVs, cell phones, heck, even clothing. The auto is a consumer good, one that most people plan on replacing every 5-10 years.
      • 6 Years Ago
      An 8 year 100,000 warranty shows that a company is confident in their product.
      Your realistic range of 32 miles came from your crystal ball.

      They wouldn't tell the public 40 if they indended to under-deliver,especially with a program they're so proud of and so public about and so "our reputation is riding on this and we know it!".

      You can pretend an ICE car never needs an oil change and the numbers still work.

      There's no way an automotive-grade battery will be DEAD and NEED replacement soon after the warranty expires. They said the window of battery useage will slowly open as the years go by, keeping to the 40mile AER range at then end of warranty life, and slowly degrading over thousands more cycles. A 15 year old Volt that has never had a battery replacement will probably get about 20 AER.

      Also, assuming the battery NEEDS to be FULLY REPLACED at 15 years,what will 15 year old battery tech cost to replace? What, maybe $2000 for the same battery, brand new? by then, there will be 60, 80, and 100 mile AER options on the market. The cost of replacing your battery in 15 years with the same one you put in will be negligible, when comparing a Volt to an ICE car. I'm sure you're familiar withthe cost reduction forecasts that many experts have made about li-ionbatteries...or are you not?

      The numbers still work just fine, it seems.
      • 6 Years Ago
      Pay no attention to the facts behind the curtain.
      • 6 Years Ago
      The cost of batteries will come down substantially and probably more quickly than predicted. Electric cars have enormous advantages over ICE vehicles.

      But this battery swapping thing is moronic. This guy just oozes snake oil and smarm. The next battle is about the electric car being OWNED by somebody who gets some form of residual income from it. Proprietary battery modules, only available from the manufacturer, proprietary drive trains, again, design and parts all under control of the manufacturer, you will get mass produced quality electric car designs just about 10 minutes after they figure out how to enslave you with it.

      Meanwhile, you can convert any car that suits you to electric drive with off the shelf components available from multiple sources, commodity prismatic LiFePo4 cells from China that are already getting cheaper and offering better performance than a year ago, and be in control of your car, your fuel, and your replacement parts.

      It's just not that hard. You replace an engine with 2500 moving parts, with an electric motor that has four terminals and three moving parts if you count the bearings.

      You rip out the exhaust system, the cooling system, the fuel system and you DISCARD THEM ENTIRELY.

      You install some batteries, a controller, a DC-DC converter and a few bit parts to make your heating and air conditioning work. These are rapidly approaching the level of putting together stereo components.

      As to swapping out the batteries, it's entirely impossible unless you all want to drive this guys car design, and sign up to this guys retirement program. And you don't need them any way.

      The batteries we've got now can be charged in 20 minutes, and the devices and power needed to do that cost LESS than the "swap stations" he's proposing. Basically just a large bank of batteries with some heavy cable connections to the car. The CHARGERS limit the charge rate, NOT the battery cells. If you charge off another battery bank that can put out the power, you can charge a LiFePo4 battery pack in 20 minutes.

      Jack Rickard
      • 6 Years Ago
      Range extended EVs will do the job without any new infrastructure.

      And its probably too early to standardize batteries for swapping.
      • 6 Years Ago
      I've said it before, and I'll say it again - sometimes to my own clown-faced reflection in a cracked mirror (illuminated by a single, dim, non-CF bulb that has somehow survived as long as the peeling wallpaper, with a sway as perpetual and ghostly as its power source):

      "If the true price of gasoline was displayed at the pump, factoring in war, health, environment, blah blah blah... the calculations would look a little different." Stick that in your Volt and smell the sweet ozone.

      It constantly amazes me that intelligent citizens, who, rightly so, believe in talking snakes and gravity-defying deities, cannot grasp the concept of a level playing field.

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