Electric vehicle "miles" company Better Place will likely go public within two years to take advantage of what many expect will be broader electric-vehicle adoption throughout the world, Bloomberg News reported, citing an interview with company founder Shai Agassi last week.

Better Place will likely have one more private round of financing before filing for an initial public offering, Agassi told the wire service said. The company has raised about $750 million since its founding.

Better Place's concept – based on the cell phone industry model – is to lease charged batteries and charging time to motorists so they can drive an electric vehicle without also having to purchase a battery pack that could cost as much as the car. Cumulative sales of plug-in electric vehicles will reach 5.2 million vehicles in 2017, up from 114,000 vehicles last year, according to green-technology research company Pike Research.

Better Place last week started delivery of the first 100 Renault Fluence Z.E. electric cars to Israeli customers as part of the company's efforts to build out an electric-vehicle charging and battery-exchanging network throughout the country, and is planning on rolling out a similar network in Denmark


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 20 Comments
      PeterScott
      • 3 Years Ago
      I always thought PBP was surviving more on Agassi's salesmanship (as in snake oil) than having a sustainable business model. Leasing batteries just doesn't make sense to me. Leasing makes things more expensive. Locking a business into massive capital investment in rapidly depreciating asset hoping to make your customers pay all your depreciation and profits doesn't make a lot of sense.
        DaveMart
        • 3 Years Ago
        @PeterScott
        There's nothing wrong with battery leasing, which reduces the outlay on electric cars. Renault do it in Europe, but it costs a small amount relative to the BP rip off.
        lne937s
        • 3 Years Ago
        @PeterScott
        Leasing reduces up front cost and reduces buyer uncertainty about long-term reliability and resale value. Those may be barriers to purchase for some buyers. If you can buy an EV for approximately what it costs for a comparable diesel vehicle and your battery and electricity cost are less than what your monthly fuel costs typically are, then it makes a pretty compelling case for buying an EV.
          PeterScott
          • 3 Years Ago
          @lne937s
          LNE: That only reinforces my point. Renault is clearly subsidizing the battery lease to sell cars. That isn't a sustainable business model for an outside company like "Better Place". When the subsidies disappear, "Better Place" will collapse like a house of cards, but Agassi will have his IPO millions by then.
          DaveMart
          • 3 Years Ago
          @lne937s
          Peter: That is simply not the way things work here in Europe. It is common practise to lease vehicles, then after 3 years you can give them back or have an option to pay the balance. Having a separate lease for the battery is really no more hassle, and means that the residuals on the car can be neatly separated from the fast depreciating battery, that the car can be bought after subsidy for the same price as diesel, and that from day one the battery lease plus electricity show a profit against diesel. The residuals on the Renault Kangoo ZE are 45.7% ex battery, higher than the just over a third on the diesel, and you have no worries about battery wear. If you then decide to buy a battery pack instead they will be cheaper/longer life/more powerful than at present. If you don't believe the low maintenance costs of electric you can buy maintenance contracts from Renault at 80% of diesel contracts. Like anything else, whether leasing makes sense depends on the specifics. With a background in cost and works I can assure you that in the UK the way to go at the moment is to lease the battery.
          lne937s
          • 3 Years Ago
          @lne937s
          Peter, Your lease conjecture is unfounded. After incentives, the Fluence ZE is 17,850 GBP, while the LEAF is 25,990. The battery lease is 69-99/month for the Fluence. It would take over 7-10 years to make up the difference. While the batteries have residual value for stationary storage and are likely to be cheaper in the future for replacement, the lease makes that process easier and removes consumer uncertainty. The overall cost comes out to be similar either way... just with significantly less of an initial price barrier and less uncertainty involved with the Renault model. If you don't want to lease the battery, buy the Nissan. If you regularly read any business magazine, you will know Carlos Ghosn likes his profits-- this will not lose money once they reach scale in the next year or so. http://www.renault-ze.com/en-gb/gamme-voitures-electriques-renault-z.e./fluence-z.e./presentation-1935.html http://www.nissan.co.uk/#vehicles/electric-vehicles/electric-leaf/leaf
          PeterScott
          • 3 Years Ago
          @lne937s
          Leasing is a mugs game. You lock in a lower payments but you have lower equity and actually you have much greater difficulty selling, because you really don't really own. Also since a battery depreciates very fast. Even faster than a car, your residual will be terrible, so your lease price will be almost the same as your purchase price. This is so screwed up that you battery + energy chargers can be higher than in you just bought a gas powered car. If you park your petrol powered car for a month, you have zero petrol costs, park you leased battery car, and you costs remain high. A manufacturer like Renault might pull this off if they are willing to completely forgo profit on the battery leasing business. But PBP, if there is a business model in there somewhere, has to be based on paying for all their infrastructure, paying for battery depreciation, and paying themselves a tidy profit. This will make the price of leasing ridiculously expensive.
          marcopolo
          • 3 Years Ago
          @lne937s
          @Dave Mart Peter Scott is quite right! Although technically in capital equipment lease lending, after the lease term you could hand the vehicle back, the financier makes sure that it would be very disadvantageous for you to do so! In fact, it's a widely accepted practise that the vehicle owner, either pays out the residual, or trades the vehicle and leases a new vehicle paying the balance of the residual in the trade transaction. Bank and finance companies do not want the problems of disposing of used cars and recovering any shortfalls from the lessee. @ Peter, I can't work out how Renault can support it's battery leasing model. But, it seems a great deal for the customer ! How Renault can afford the program is R Renault's business! but, Dave Mart is quite right for the Renault EV buyer, it's a very good deal, especially for commercials!
        DaveMart
        • 3 Years Ago
        @PeterScott
        @Ine: I think that Renault have got the right sales idea for European sales, to the extent that I don't think Nissan will be able to hit sales targets for the Leaf. We are used to small cars for the city here, and the Zoe will IMO wipe the floor with the Leaf. Not that it is too cramped inside anyway, for the short journeys that it will do. Perhaps Nissan will go to battery leasing in Europe.
      marcopolo
      • 3 Years Ago
      @Danny King, From ABG; " Cumulative sales of plug-in electric vehicles will reach 5.2 million vehicles in 2017, up from 114,000 vehicles last year, according to green-technology research company Pike Research." From Pike Research; " cumulative sales of plug-in electric vehicles (PEVs), the category that includes both PHEVs and BEVs, will reach 5.2 million units by 2017, up from just under 114,000 vehicles in 2011.'' Danny, can you appreciate the difference? None of these vehicles is able to be adapted to suit the 'Better Place' battery swapping concept, and without that, (and a monopoly) all better place offers is some mediocre charging post, that have so far failed to meet local authorities requirements. Danny, I'm afraid you seem to be another, 'taken in,.. by the Better Place spin!'
        DaveMart
        • 3 Years Ago
        @marcopolo
        'None of these vehicles is able to be adapted to suit the 'Better Place' battery swapping concept' ? I don't follow you. Most will not be able to use the BP system, fair enough, but all the Fluence models and the Zoe will be able to use them. So there won't be millions, but are likely to be hundreds of thousands of BP compatible vehicles on the road by 2017. Hopefully Israel will remain the only market stitched up so as to force people to pay just as much to power an electric vehicle by BP, but those mad enough to want to in Europe will have cars available to do so.
          marcopolo
          • 3 Years Ago
          @DaveMart
          @ Dave Mart My point was that the 5.2 figure included PHEV's as well as BEV's. The article was really quoted in the context of the US market, and since none of the vehicles currently on the US market is designed with Better Place it was in that context, I observed no vehicles are able to be adapted. But, I take your point. it would have been more accurate to say, 'all these vehicles, except two Renault products, are not Better Place compatible.' (To digress: Tomorrow, I'm being taken to see the wreak of the liner, Costa Concordia, and will attend a lecture on the difficulties involved in the safe removal of the Fuel and Fuel Tanks.)
          DaveMart
          • 3 Years Ago
          @DaveMart
          The Concordia lectures should be interesting. I didn't much like the Gadarene rush by the company to place all the blame on the Captain, although he was clearly at fault. There is plenty of blame to go around though, and it is a peculiar company which allows or authorises diversions without apparent checks, or appoints captains with the apparent major character flaws that this one had. At a still higher level, having drills some days AFTER boarding the ship is an absurd form of roulette, and the top heavy and unstable build of these ships shows excessive regard for costs and too little for safety. At a more challenging technical level, as one expert remarked the present system for launching lifeboats is ineffective when the ship is listing heavily and needs redesign.
          marcopolo
          • 3 Years Ago
          @DaveMart
          @Dave Mart I agree, it's very inappropriate to pass any judgement until a full and open Maritime Court of Enquiry has been held to determine all the circumstances. Trial by tabloid journalism is always a distasteful display of catering to the worst traits of human nature. Fortunately, the Costa Concordia was carrying a limited supply of fuel due to the low speed and short distance, and most of the 13 full tanks contain No 5 or blends of No 2 and 5. This will help with removal and fractionally mitigate the disastrous effects of ships carrying No.6 fuel.
      noevfud
      • 3 Years Ago
      Is that a battery swapping cord? LOL.
        Spec
        • 3 Years Ago
        @noevfud
        BP vehicles will be charged by cord the vast majority of the time. The battery swapping is only for inter-city trips that require long range. It is a clever system. The problem with BP is getting locked into a contract with a single vendor for your vehicles lifetime.
      markrogo
      • 3 Years Ago
      This is going to be among the worst billion-dollar venture capitalist investments of all time.
      smithd4200
      • 3 Years Ago
      From ABG: "Better Place will likely have one more private round of financing before filing for an initial public offering, Agassi told the wire service said. The company has raised about $750 million since its founding." From the Bloomberg article: “We’re probably not going to go for another private round between now and the initial public offering,” Agassi, 43, who founded the business, said yesterday at Better Place’s test track and showroom north of Tel Aviv. “We have enough capital to go all the way until then.” Am I reading something wrong?
        Spec
        • 3 Years Ago
        @smithd4200
        It never ceases to amaze me how people can become wealthy by creating money losing enterprises. I guess the trick is to create a big money-making enterprise and after that, people will throw money at you for your next company even if it is a dog.
      Spec
      • 3 Years Ago
      Well . . . with IPOs like Groupon and Zynga out there, why not another Ponzi scheme IPO?
    • Load More Comments