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Plug-in hybrids: 100 miles per gallon or 59?
August 6, 2007
You did. You and the periodic table of the elements, with a little help from physics. Don't feel bad. Any individual responsibility seems to be spread pretty thin, but I figured it was about time to speak on the issue.
In the past few years, a theory has developed hinging on the notion that oil producers, in cahoots with auto manufacturers, conspired with each other in the mid-'90s to throttle the electric car in its crib. As a result, we've all been consigned to environmental doom.
The doom part actually seems to be on track, but the rest of the theory doesn't hold up that well upon closer inspection. Don't get me wrong: I think electric transportation (along with clean diesel) will become more prevalent over the next 20 years. And automakers have worked to keep emissions standards low. But here are some reasons why we're not witnessing a modern-day version of the Knights Templar:
1. U.S. automakers. Think about it. This is General Motors and Ford Motor we're talking about. U.S. automakers are the last bastion of industrial feudalism on the planet. The most innovative things they've come up with in three decades are the cupholder and the Lee Iacocca goggle glasses. (It was a huge fashion statement back in the '70s, kids.) These people are going to engineer a global conspiracy that eludes regulators around the world, financiers and competitors? GM execs are more concerned about who gets named to the Rolling Hills Country Club membership committee.
2. Japanese automakers. Toyota Motor and Honda Motor came out with electric cars in the '90s. Japan's economy at the time remained stuck in the doldrums and the government, fearful of competition from other Asian tigers, was scrambling to find a hot export. Instead of working with the government--something they've done in the past--Toyota and Honda were said to conspire with their natural enemies (GM and Ford) to help oil companies, which because Japan imports all of its oil, aren't well liked in that country. The conspiracy had the automakers, led by GM, touting reasons why there was no market for electric vehicles, including the vehicles' limited mileage range per charge. GM pulled its electric car, the EV1, off the market. Didn't you guys listen to what Sean Connery was talking about in Rising Sun?
3. Hybrids. Toyota overtook GM as the largest car maker on the strength of the Prius, the part-electrical car that came out in 1997, the same year GM came out with the EV1. (GM leased 650 EV1s while Toyota sold 323 Priuses.)
To believe the conspiracy, you'd have to think of the Prius as a cover-up to keep the real reason under wraps. It wasn't because the Prius worked better. Follow the money, as crazy people like to say.
4. Sales weren't great and neither were the cars. There was a lot of customer curiosity, but few walked out of the showroom with a sales contract, according to Mary Nickerson, national marketing manager for Toyota.
"The Rav4 EV had a 100-mile range. That range was not sufficient for most people in the marketplace," she said at a conference earlier this year. "If it is the only vehicle in your garage, it is not enough for a typical American household."
Elon Musk, chairman of electric-vehicle company Tesla Motors, put it to me another way in July 2006: "Until today, all electric cars have sucked."
5. The fans were visible, but small in number. "The people who had the car (the General Motors EV1) loved it, but battery life was a bigger issue for the larger market," said Alan Gotcher, CEO of Altair Nanotechnologies, which makes lithium-ion batteries for electric cars. "I don't believe in the conspiracy theory. The battery still only had a five-year life. It didn't last the life of the car, so how do you handle that issue?"
Again, Gotcher, like Nickerson and Musk, works at a company that wants to make money from electric transportation.
6. Batteries are tough to make. Why did computer notebooks begin to explode more than normal last year? Battery makers pushed too hard to improve their products and the volumes of production. There is no Moore's Law for batteries that allows them to get cheaper, faster and better at a steady rate over time. The gains are generally slow and incremental.
"People have tried all of the elements of the periodic table for a long time," said Alain Harrus, a partner at Crosslink Capital, which invests in semiconductors and batteries. "The cycles, charge times, etc., are well known."
Right now, car makers are examining both lithium cobalt and lithium phosphate batteries. Cobalt ones store more energy, but are more likely to have a runaway thermal reaction. The phosphate batteries, however, weigh 30 percent more, he added. Trade-offs. Ugh.
7. Batteries are expensive too. Making an electric Honda Accord would probably add about $30,000, estimated Ian Wright, CEO of electric sports-car company Wrightspeed, last year. Gasoline-fueled Accords on sale today cost less than that. That's a tough marketing pitch.
Battery expenses are one of the reasons plug-in hybrids haven't swept the world. The upgrade costs about $15,000. Even if gas cost $4 a gallon, you'd need to drive 150,000 miles--within the city--to recover the cost.
Companies are currently trying to figure out ways around this. Tesla and Wrightspeed are aiming at the high-end market, where performance rules over price. India's Reva makes cheap cars for emerging market customers whose governments have begun to pass strict emissions requirements. Phoenix Motorcars and others target fleet buyers whose vehicles don't need to go more than 100 miles before a recharge. How they tinker these pitches will be interesting to watch.
8. A car company is about the worst thing you can do to yourself. Ben Rosen helped found Compaq Computer and had a hand in a number of other tech enterprises, including Ask Jeeves. He was also behind Rosen Motors, a short-lived car company idea. Making cars involves constructing huge plants, assembling massive supply chains and undergoing millions of dollars' worth of crash testing. Then you have to visit a whole bunch of dealers and drink some really bad coffee in those glass showroom cubicles before they will agree to pick up your cars. Good luck. I'd rather sell air fresheners.
So to sum up, consumers are cheap and don't want to be inconvenienced by a car that will die on the freeway before they get to Ikeda's produce and burger stand when they're driving from the Bay Area to Lake Tahoe. And the people who win worldwide fortune and fame by bringing you an ideal mode of transportation have had more trouble than they thought.
I might be wrong, but I doubt you're going to read about me getting strangled with a piano wire.
Michael Kanellos is editor at large at CNET News.com, where he covers hardware, research and development, start-ups and the tech industry overseas. He has worked as an attorney, travel writer and sidewalk hawker for a time share resort, among other occupations.
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