• Aug 2, 2010
It's hard to believe that it was just four years ago that Chris Paine's documentary "Who Killed The Electric Car?" was released. With new EVs from several manufacturers hitting showrooms over the next three years, despite gasoline prices staying stubbornly below $3.00 per gallon, the title of his new documentary could be, "Who's Buying Electric Cars?" Recent history has taught auto companies that when gas prices rise above $4.00 per gallon, sales of hybrids, like the Toyota Prius, surge, as do sales of small cars like Honda Fits and Ford Focuses. When gas prices come back down to current levels, sales of these cars cool. With oil prices impossible to predict, it makes planning new models very difficult.

Nevertheless, Nissan is introducing the Leaf EV this fall, which promises to get 100 miles on a full charge of its battery. Later this year or early next year Ford will roll out the Transit Connect EV, followed by an electric version of the Focus. BMW's Mini brand has been testing an EV with the intention of broader sales in 2013. Smart is also testing an EV. Mitsubishi is planning to launch one in the U.S. soon. Volkswagen announced it will have an EV, probably a version of the Golf, by 2013. Audi and Mercedes both figure to introduce EVs by 2013 as well. Chrysler and Fiat are making noise about a possible EV version of the Fiat 500 mini-car.

LeafTo be clear, these cars are fully electric. They are not hybrids, like the Toyota Prius, which cycles between a gas engine and electric motor, nor are they plug-in hybrids or "extended range EVs," like the forthcoming Chevrolet Volt, which promises to travel on battery power for around 40 miles before a gasoline engine kicks in. A fully electric vehicle is powered only by battery power, meaning when you run out of juice, you go nowhere until you can swap out the battery for a new one, or recharge the one you have. No jump-starting. No can of gas from AAA.

There are three big reasons automakers are pursuing EV technology, and they don't have much to do with profit. The first is to help satisfy toughening fuel economy standards. The second is to have the technology ready as it spreads in a major market such as China. The third, and perhaps biggest motivator, is to give their brands a halo of environmental appeal.

Just how many people will buy these cars is unknown. J.D. Power and Associates forecasts that automakers will sell 24,000 EVs worldwide in 2010, which seems like a lot, but is a pretty paltry number when you look at a North American vehicle market that even in these hard times tops 11 million units. By 2015, Power predicts, sales of EVs are expected to total 500,000 units globally. Consider as well that there are about 70 million new vehicles sold globally.

The biggest obstacle facing EVs is cost. The cost of the battery in the Leaf is estimated to be $9,000. The battery pack in the Tesla luxury EV roadster costs about $20,000. Other EV batteries are said to cost somewhere in between. The Leaf will sell for about $25,000 after a controversial $7,500 government credit is applied. Even the more mainstream Volt, with its gasoline engine aboard for range-anxiety-defeating backup power, will cost about $33,500 after government credits. Conservative, but hardly nutty, journalist and pundit George Will has already pronounced the Volt a failure because it can't be sold without the hefty discount courtesy of the American taxpayer. For the same price, by comparison, a consumer could buy a nicely equipped Ford Taurus, a loaded Subaru Legacy, or an off-lease BMW 3 Series.

Figuring out the benefits or payoff of spending big money on an EV gets you doing math problems with the skeptics pretty fast. Here is one such analysis: The per-mile-cost of fuel for a traditional gas powered car like a Toyota Corolla is about 10 cents by today's average gas price of $2.75 per gallon. The cost per mile for an EV ranges between two and four cents per mile. At 15,000 miles per year, the gas car costs about $1,500 to operate, while an EV would cost about $500, saving the EV owner $1,000 per year. Most car buyers won't spend more than four to six years of fuel savings on a car, so the maximum an EV can cost over a comparable gas-powered car is a little under $4,000-$6,000. The Nissan Leaf, which, apart from its electric powertrain, could be compared with a Hyundai Elantra Touring, which costs about $19,000. Given the Leaf's $25,000 price-tag after government credits, it's in the ballpark. In California, state tax credits for the Leaf bring the price down to $19,500, plus California drivers get to use the high-occupancy-lanes (HOV) in an EV, saving time and money.

For early buyers of EVs, however, it's best to forget the math. These are going to be the early adopters, the people who just want to drive an electric. They want to kick the gasoline habit for environmental or political reasons. They are frustrated with environmental disasters like the BP oil spill in the Gulf of Mexico and are fed up with battling wars in far-off battlefields over what they consider to be access to oil. They are going to buy an EV to make a statement about their convictions.

But no one is sure how big that market is. What automakers do know is they can't count on free-market demand to the degree that they can invest billions of dollars in plants and technology without the government playing a role in stoking consumer demand for EVs through regulation and tax credits. The Europeans drive demand for high-fuel economy vehicles through high gas taxes, and that is something the U.S. Congress is unwilling to do out of fear that an energy-hungry electorate will fire them on Election Day.

For the rest of us, there are big questions that accompany this proposed shift in technology. To help provide some answers, I asked Finland-based Think, which is getting ready to sell a two-door EV in the U.S. next year, to lend me a car for two weeks. The company, once owned by Ford, has recently brought about 500 of its electric cars to the U.S. to sell into fleets. I wanted to see what it's like living on Electric Avenue. What are the sacrifices? What adjustments will I have to make? Will I feel range anxiety, and fear running out of juice before I can park somewhere to recharge the battery? What follows will be five days of daily driving and commentary about living electric with the Think City.

Click the links below to read about our experience Living On Electric Avenue

Living on Electric Avenue
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