BETTER PLACE CEO Evan Thornley 370.
(photo credit: Courtesy Better Place)
Bankruptcies of electric carmakers – Better Place in Israel and Fisker in the
United States – are setting back the movement many years. Current owners are
left with worthless vehicles, closed charging stations, repossessed batteries,
bank loans still in force, and buyers are scarred by the experience.
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. Cartel oil producers
and refiners tinker with prices at will and have sparked international
recessions, threatening core national interests of economic planning, national
security and environmental health. Oil is the mother’s milk of
terrorist sponsoring countries and is more a controlled substance than a
Cars, trucks and buses emit 27 percent of
greenhouse-gas emissions. They are responsible for 70% of petroleum consumption
(400 million gallons per day) in the US. The focus is on increasing
miles-per-gallon to reduce oil consumption, but gallons- per-mile is the
problem. Treating PEVs as part of a national defense strategy will change the
transportation dynamic in a decade.
According to a University of Indiana
report, electric-car ownership will increase with high energy prices, lower
battery costs, convenient recharging infrastructure and progress with PEVs
compared to competing technologies.Here is what needs to be done:
sticker prices are coming down, but too slowly on too few model choices. The
target is a five-passenger vehicle in the $25,000 price range. Tesla’s new sedan
is $69,000 – an alternative choice to their staple car, which starts at
$100,000. Going in the wrong direction, Israel taxed Better Place cars for 27%
of the car and battery, adding almost $10,000 to the purchase
Washington and Virginia want an annual $100 tax on electric cars
to replace lost fuel taxes.
• Perspective changes of selling points to
PEV buyers stress lower energy costs of $1,400 annually, maintenance and
Buyers often suffer range anxiety. Currently, daily driving
ranges are 110 kilometers to 150 km. per charge. Quick battery exchange stations
built around Israel and Denmark meant drivers never exited their vehicles.
Batteries were robotically replaced in less time than it takes to fill a
traditional car with gasoline. Tesla wants super-charging stations stretching
from New York to Los Angeles.
• A culture of shared experience would
challenge the lack of awareness about PEVs through in-your-face ad campaigns
such as those used to sell fossil-fuel cars. Inventories and model choices must
be expanded. Tesla sold 21,000 new sedans, while more than 500,000 new
gas-powered passenger cars were sold in the same period. More PEVs on the roads
for other drivers to see stimulates buyers into believing they are part of
something larger, enticing others to buy, akin to VW Beetle owners who honk one
another in a cult of camaraderie.
• The US government lent Tesla $460
million – a lot of money, but a pittance compared to China’s $15 billion
investment in PEVs. According to Shai Agassi, Better Place’s founder, the
company “generated approximately half a billion of taxes for the State of Israel
but did not receive a single penny in government assistance in its deployment of
a ‘strategic infrastructure to replace oil.’ Nothing!” Tesla repaid the federal
loan from public stock offerings, but it will have to build charging stations
from cash flow and private investment. It will delay necessary infrastructure
development needed to spur sales for years to come.
• Only government can
afford to build PEV infrastructure quickly, if significantly reducing dependence
on fossil fuel is the priority. It is no less legitimate than airports, dams and
electric power grids.
Lawmakers can encourage private investment in
R&D, similar to what is done for pharmaceutical companies, and provide tax
incentives for first-time PEV owners, as it does for first-time home
• Require 25% of the 19,000 cars bought each year by the US
government to be PEVs. Producing more PEVs will lower production costs and
therefore selling prices. Offer significant tax incentives to fleet purchasers,
such as Enterprise, with more than 500,000 vehicles. According to Agassi, taxis
in urban centers such as Chicago with 7,000 vehicles drive 20%-40% of the miles
driven in the city on any given day by all vehicles.
Industries Ltd. was poised to lease several dozen Better Place cars beginning
this May because, as IAI’s Ya’acov Goldstein told Globes, the agreement will
reduce air pollution and “will bring the company financial savings.” Better
Place has joint ventures with Nissan, Renault, a Chinese company and a Japanese
taxi company, but on the cusp of greater sales, shortsighted officials want to
liquidate Better Place.
• Auto-industry analysts are prolific
trendsetters but splenetic about electric-car development. One labels government
subsidies a waste, warning: “It had better use some of the money to buy a large
parking lot to store all those unsold cars.” Not a word about the $400b. a year
for imported oil that accounts for nearly half the US trade deficit.
The PEV represents a long overdue shift to reason, sanity and national security,
after the internal combustible-engine delirium of the past century. “Unless
someone like you cares a whole awful lot, nothing is going to get better. It’s
not,” says Dr. Seuss.Dr. Harold Goldmeier is the managing partner of
Goldmeier Investments LLC and an instructor of business and social policy at the
American Jewish University in Tel Aviv.