ABG: How did you get started with American Electric Vehicles?
ST: We have a pretty strong marketing background in launching new brands in the United States and throughout the world. A guy acquired the rights to the vehicle from a relatively under-performing Italian company that had great designs but weak business sense. He asked us for help in launching this brand. We looked at it and thought it was fantastic and next thing we had half the company. It started as most things, out of necessity, I've got this great design, can you help me bring it to life? We're all one big happy family now, we've got experts in assembly, manufacturing, marketing, purchasing, design and quality control. We've got a really good group of ex-car guys turned new vehicle guys.
ABG: So the Kurrent originated from an Italian company?
ST: It's an Italian design that's been around for about four years. We've got about 600 units on the road around the world. We've got a lot of good testing on it and the design is just fantastic. We think the styling is best in class. We only have one major competitor and that's the GEM, so it's not too hard to beat them in terms of styling.
Continue reading the interview and see more photos after the jump
ABG: Design isn't generally a priority for vehicles of this type.
ST: Coming from Torino, Italy, design is a priority for them. This car was created by a company that I'm not even sure is in business anymore, they were called StartLab. The genesis comes from really sharp car people on the fringe and that's where these kind of ideas originate.
ABG: I understand you have a background in marketing, and you hooked up with the Italians to push this project forward?
ST: Yes, it quickly became not an Italian team, but an all American team in Ferndale, MI. We're all from here and we wanted to be able to leverage our connections with expertise in assembly, manufacturing, design and purchasing with the suppliers.
ABG: Is your background in the auto industry, or elsewhere?
ST: My background is 27 years in the auto industry. I started in the sales and marketing side with American Motors, Renault, and then Chrysler and DaimlerChrysler. I worked at six of the top advertising agencies and I've got a strong background in brand development and dealer sales. I worked on creating the Jeep brand in the late seventies and eighties. This is very similar to what happened with Jeep, take a single use, very narrow vehicle and through brand development and cultural receptivity, it morphed into the sport utility category. From there it held the enviable position of owning or creating the category which it competed in.
We believe that with the electric car, particularly the NEV (neighborhood electric vehicle) category, the planets are lining up. We've seen it before and we're moving in that same direction with American Electric Vehicle Company and our first product, the Kurrent to set the stage to own the fun and more emotional aspects of the NEV category, and we're using Jeep as a template.
ABG: You have the Kurrent now, what's the status of getting that vehicle to market?
ST: We have about twenty-five sold already and eight more in production. We'll have about twenty-five produced by mid-January and sixty by February 15, and 190 by the end of March. We source our components from all over the world and we're driving toward seventy percent US sourced components with half of that from Michigan.
ABG: What are the retail plans for the Kurrent? Are the cars that you have in progress now and in the next few months pre-sold? And what are the retail plans going forward?
ST: Yes, those are sold. Coming from the large auto industry, our first instinct was to get a major dealer network going, get distributors, etc. As we got into it, we realized we were going sell out our 2007 volume of about 2,100-2,500 units, and 2008-2010 were going sell about 10,000 units and we're going to top out at 15,000 units which is a small company. So there's no real need to have these great legacy organizations and structures that we grew up with. So it was a real learning process for us to skinny the operation of the company down to the point where it made sense from a volume and distribution standpoint.
Therefore we'll have a handpicked dealer network in specific markets where NEVs are strong. It's going to grow organically and be populated by people who understand NEVs, and the consumer and market that's emerging for smaller more fuel efficient, expressive vehicles. If you bought one of these at typical car dealership, might not be able to drive it home because it's an NEV and the government restricts it's top speed to 25 mph on roads with speed limit of up to 35 mph.
We have a home delivery program as part of the price. Since it's essentially an electrical appliance, you call a 1-800 number and we have a mobile service contract around the United States and technicians will come out and fix whatever problems are on the car. From a dealer standpoint, there is no need for carrying parts inventory or service capability. Essentially it's understanding the market, being in the right place and a sales organization driving sales. It's relatively low overhead and high margin for dealers.
ABG: What's the price of the Kurrent?
ST: The Kurrent as it stands right now comes much better equipped than a GEM. It has wipers, doors, headlights, seatbelts and a trunk all standard and sells for $9,800 and a delivery charge of $800.
ABG: Let's get into the technical details of the Kurrent a little more. What are the safety requirements of an NEV? and the capabilities of the Kurrent?
ST: NEVs are subject to Federal Motor Vehicle Safety Standard 500 (FMVSS500). The requirements state that it has to be under 2,800 lbs, have four wheels and has to have seat belts. It doesn't require crash testing, and it's limited to 25 mph. There is some state legislation and lobbying to raise that to 35 mph on 35 mph roads. the Kurrent has doors with steel frames inside, an aluminum egg that encloses the driver and passenger with the suspension attached to that. It has full safety glass, seat belts, headlights, turn signals, horn, and backup lights. It's got all the passive safety equipment that you need. We did do a crash test in Japan which is required for NEVs over there. We did a 25 mph front end crash test which we passed with flying colors.
ABG: What type of battery are you using?
ST: The batteries four 12V deep cycle, lead gel batteries tied together for 48V. It also has another 12V auxiliary battery that runs the heater, radio, wipers and other accessories.
ABG: Can you tell me more about the motor, brakes and suspension?
ST: It has MacPherson strut front suspension, with disc brakes in the front and drum brakes in the rear. The rear suspension is trailing arm which gives good performance and great ride. It has rack and pinion steering and the vehicle drives like a sports car, not like a golf cart.
ABG: How much does it weigh?
ST: It weighs about 1100 lbs and the gross vehicle weight is about 1800 lbs.
ABG: What's the range?
ST: The range is about 35-45 miles, depending on how much you use the heater, the headlights and other accessories. You can charge it from complete exhaustion to completely full in about eight hours, but you can plug it in anytime to any 110V outlet. The charging system is all self contained unlike our competitors which require a 220V charging unit.
ABG: Where do you go beyond the Kurrent?
ST: Next year we're working on several other versions of our vehicle including a four wheel drive version, a four seat, two door version, and utility version with five foot pickup bed. Battery and motor technology are coming along so quickly that it makes this side of the business unbelievably challenging and fun. We're also looking at hub motors, which would give us more flexibility.
ABG: Would these future vehicles still be in the NEV class, or would they move up into a more conventional class?
ST: No, what we want to focus on, like Jeep, we want to own the NEV category. We want to create the excitement and cultural connection within the NEV category that we did with Jeep in the SUV category.
ABG: How big do you think that market can really get?
ST: I think it's growing quite a bit. There's about 80,000 NEVs on the road today and the market travels at about 20-25,000 a year, we think that's going to grow at about 20-27 percent a year as the requirement for more fuel efficient fleets increases. With gated communities, industrial complexes, college campuses, the market is going to grow to maybe half a million vehicles by 2010. Nobody would have that about the SUV category, but if you make the right products and serve it up in the right way, it can be done. We've done it many times. The acceptance of these cars is growing and the consumer desire for expressive designs that can make a cultural connection is growing and therefore companies like ours that can make a very nice living on 10-15,000 units a year is a business model of the future.
Thanks to Scott Thornton for taking the time to talk to AutoblogGreen. We'll be visiting the factory and driving the Kurrent in the next few weeks after the craziness of the Detroit Auto Show is over.