Better place 311.
(photo credit: Better place)
Last June, I wrote in The Jerusalem Post about the darkening future for electric
vehicles. Fisker in the US and Better Place in Israel declared bankruptcy.
“Current owners are left with near worthless vehicles, closed charging stations,
repossessed batteries, bank loans still in force and buyers scarred by the
Now Tesla Motors, the largest independent electric-car
manufacturer, suffers from technical, image and financial problems, setting back
the movement for energy independence from foreign oil many more years. “The
electric car (plug-in electric vehicle, or PEV) is not just another green-tech
project; it is a weapon in the fight for global security with the potential to
free industrialized nations from fossil- fuel dependence.”
percent of petroleum consumption in the US feeds cars, trucks and buses; 95% of
petroleum imported into Israel is for consumer consumption. Israel’s dependence
on foreign energy imports is particularly alarming.
jump every time there is an attack on the Sinai pipeline. Israel’s new-found gas
fields might ease that problem. Oil imports leave the country vulnerable as the
number of cars on the roads increase.
A new report for the Transportation
Ministry shows a 20% decline in use of buses and railroads between 1995 and
2008, while there are 15% more cars; 79% are passenger cars, yet there is a
deafening silence from Israel’s government to PEVs reducing Israel’s foreign oil
A commix of environmentalists and national-security
right-wingers welcome the potential of PEVs to free nations from oil imports.
Government officials in league with a cabal of private powers prefer spending
money searching for and extracting shale-rock oil. This policy requires great
financial expense and sacrifices to environmental safety, giving short shrift to
new types of energy sources powering vehicles.
Recent events are major
blows to PEV development. First, Better Place assets recently sold for pennies
after the government refused to back a bailout. New owners reportedly paid
$450,000 for assets valued at $2 billion about two years ago. Investors such as
General Electric, HSBC Holdings and the European Investment Bank lost upwards of
$800 million. Confidence in the industry for future investment is shaky.
Innovation and commitment to oil-free transportation are stymied.
and most disheartening, are new problems facing Tesla Motors. Their batteries
caught fire three times in six weeks, sparking an investigation by the National
Highway and Traffic Safety Administration. John Broder castigated the battery
holdout in a New York Times article. Superstar George Clooney criticized the
roadster he previously owned, further setting the company back; playing defense
tarnishing the company’s most valuable asset, its reputation.
the NHTSA awarded a Tesla car a five-star rating, placing it in the top 1
percent of all cars tested. Tesla received Motor Trend’s 2013 “Car of the Year”
award. Consumer Reports said Tesla’s car “performed better or just as well
overall” as any car it’s ever tested. Tim Sullivan praised the company in
Harvard Business Review, saying, “Tesla is run by visionary engineers.”
According to Arthur Wheaton of the Western New York Labor and Environmental
program, “Tesla is an image car; people want to be seen driving them because
they have a positive environmental image.”
Adding to troubles is
confusion over Tesla earnings reports. The stock price dived from $195 per share
and now hovering in the $120 range. Jonathan Weil of Bloomberg Business said,
“Sometimes Tesla acts like it doesn’t know what it’s doing when it comes to
Their figures might be off as much as 40% with
disparities between reporting $16m. in net income for the third quarter and a
$38m. loss in the same period, in the same report, using different accounting
measures. It is backed by a $450m. loan from the US government. Some believe
federal investigations may initiate for protection of investors and the
Perception in marketing is nine-tenths of the consumer
decision-making process. Bad press hurts not only Tesla, but also the entire PEV
market development and global security. These problems especially hurt because
Tesla is the leader in the industry.
Hybrids and new electric cars from
major brands are shortstop measures not yet benefiting from heavy investments in
marketing to sway public perceptions and decisions about car buying. They also
have to lower the prices, make serious structural changes in the industry and
overcome oil-lobby interests. Hopefully, 2014 will be a better year for
electric-car reputations. Dr. Seuss left good advice for PEV makers: “Why fit in
when you were born to stand out?” Dr. Harold Goldmeier is the managing partner
of Goldmeier Investments LLC and an instructor of business and social policy at
the American Jewish University, Aardvark Israel Gap Year Program, Tel Aviv.