Electric cars are widely expected to be a hit with consumers. This is especially true in places such as California, where residents show a special interest in new environmental technologies.
But it is easy to wonder if hype is getting ahead of reality. Factories will take years to ratchet up the production of these low-profit autos. And the impracticality of EVs will likely delay purchases once the early adopters snap up their babies.
In short, modest growth at a modest pace will probably define this market. Any thing else is guesswork at this point. Here are several divergent predictions just from today that show how difficult it is anticipating this market place:
*China will have 50 million electric cars in operation in 2020. This total will rise to 200 million by 2030, according to Frbiz, a business-to-business Web site. Clearly this number is pie in the sky. Chinese officials have an government production target of 500,000 alternative fuel vehicles next year. So a 50 million target implies a ten fold manufacturing increase in a real hurry.
*Pike Research expects 3.1 million electric vehicles to be sold worldwide by 2015 – an obviously more realistic assessment. But this too suggests a sharp manufacturing increase. If worldwide production is roughly 50,000 vehicles this year, factories will need to increase 10 fold to reach the 620,000 annual level to meet this forecast.
*Pike also expects that from 2010 to 2015, 4.7 million charging stations will be installed across the globe. This requires roughly 1 million new stations a year.
*That pace implies Americans will have access to 1 million vehicle charging spots by 2015 – primarily at home. (The rest of the world will rely more heavily on public charging spots since home charging is less convenient.) To accomplish this gargantuan task, the world needs to move beyond pilot phase rapidly. But this doesn’t appear likely.
*For instance, Icon Parking Systems said today it will install EV charging stations at some of its 200 parking garages in Manhattan. All well and good. But the level II stations will operate in a test mode (managed by Car Charging Group and running on equipment from Coulomb Technologies) for an unspecified period providing monthly, weekly and daily charging. So just how long will the test will last before commercial deployment begins? And more than that, how that will electric charger swapping work in Manhattan?
*This same uncertainty accompanies Enterprise Rent-A-Car’s promise last week to offer about 500 Nissan Leafs at rental dealerships in Los Angeles, Seattle, Portland and San Diego. The announcement follows a similar agreement by Hertz to do the same – with expectations EVs could be available as early as January. But what will a customer do when the car runs out of juice after 100 miles (or less)? And do you bring back a car with an uncharged battery? There remains a lot to work out.
*Finally, Chelsea Sexton, the former GM employee best known for her defense of the EV-1 electric car in “Who Killed the Electric Car,” highlights the dilemma facing car manufacturers. She predicts 40,000 to 50,000 electric cars will be on the market for sale next year. Consumer demand will be 200,000, creating a shortage, Sexton said in an interview of the Forbes Web site. However, what she is referring to is demand from early adopters. What happens when this initial surge passes?
Clearly experts expect electric cars to create strong consumer interest. PG&E officials, for example, are planning for quick-than-expected pick up in northern California, where they seriously worry electrical transformers will not be able to handle the extra juice. A single electric car can draw as much power as a home on a hot summer day.
But given the sour economy, faster-than-expected might be less than some anticipate. This was certainly the gist of the observation from Chinese carmaker BYD, which released quarterly earnings on Sunday. Revenue from the company’s lithium-ion battery and other electronic businesses (cell phone components) rose 55 percent. But overall, the company warned of an auto market that slowed during the second quarter and which would only show modest growth in coming months.
The company, which is 10 percent owned by a unit of Warren Buffett’s Berkshire Hathaway, plans to begin selling its e6 electric car in the United States this year. One hopes BYD does not anticipate this EV is a ticket to new prosperity.
Posted by Mark Boslet 
