Automakers can’t sell All-Electric Cars and Hybrids because Car Buyers don’t Want Them

Posted by PITHOCRATES - September 30th, 2012

Week in Review

The American car buyer has looked at all-electric and hybrid cars.  And after about two years of looking at them they are telling us what they think about them.  They don’t like them.  They don’t want to buy them.  And the automakers are starting to get the message (see Buyers, automakers raise doubts about electric cars by Chris Woodyard posted 9/28/2012 on USA Today).

Having largely exhausted a pool of electric-car devotees as buyers, automakers are facing headwinds in trying to make plug-in cars a mass-market product.

Nissan joined General Motors last week in offering deeper lease discounts on its premier electric car. The latest deal on the all-electric Leaf brings the lease payment closer to the level of a comparable non-electric car, not counting the gas savings, an analysis for USA TODAY by Edmunds.com finds…

Yet, some automakers are stepping back when it comes to battery-only electrics:

Toyota, for instance, announced this week that it will bring as few as 100 of its electric version of the Scion iQ to the U.S., not the thousands expected earlier. Toyota Vice Chairman Takeshi Uchiyamada warned that current all-electric cars just don’t meet the range requirements of most drivers.

The electric car is perfect for someone who doesn’t drive anywhere.  Where the range of the all-electric car isn’t an issue.  If you have a short commute to work or all your needs are satisfied within a 10 minute drive from your house than the all-electric car is for you.  Well, that.  Or walking.  But if you have a 30 minute drive home from work in a winter blizzard you’re going to want a gasoline engine under the hood.  To keep you warm.  To keep your windows defrosted and ice free.  To keep your headlights shining bright.  And best of all, to get you home so you don’t have to walk home through that blizzard.

EV start-ups aren’t having any easier time. Tesla warned in a filing this week that production of its new $57,000-and-up all-electric Model S sedan has fallen far behind schedule.

The higher price also has put off buyers, and the non-partisan Congressional Budget Office recently issued a report concluding that the government’s up-to-$7,500 tax subsidy for buying an electric car will cost taxpayers $7.5 billion over seven years but does not make up for the extra cost of the cars. It found that electric cars average $16,000 to $19,000 more than a comparable gas-engine or hybrid vehicles.

But cheap leases, along with the savings on fuel costs, have closed that gap some, at least for the Volt and Leaf.

GM has sold 13,497 Volts in the first eight months of this year, according to Autodata, more than three times as many as in the same period last year. The total has been helped by the fact that on the $39,995 Volt, Chevy is offering a $299 monthly lease after a $1,529 down payment.

The Edmunds.com analysis finds that before adding in fuel savings, this amounts to 34 cents a mile for the life of the lease, compared with 22 cents a mile for a comparable, non-electric Chevrolet Cruze, which has a sticker price of less than half a Volt’s.

This is the big problem with all-electric and hybrid cars.  They cost too much.  And people only buy them because the government slaps fat subsidies of taxpayer money on them.  Or by the sales of gasoline-powered cars.  For when they sell a car below cost they have to recover that cost elsewhere.  And the only place they can is in the price of the cars people want and are buying.  Those cars with a gasoline engine under the hood.

So if you want one of these electric cars you have to make big sacrifices in your life.  From not driving anyplace more than a 10 minute trip from your home.  To not buying other things because you’re paying so much more for a car than you have to.

It is clear that the all-electric and hybrid cars are just not viable business models now.  That could change.  But for now any more taxpayer money invested in electric and hybrid cars is money wasted.  Because car buyers simply don’t want to buy them.  Now all we need is for our government to learn what our automakers have learned.

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GM and Ford pursuing Carbon Fiber to Improve Fuel Efficiency and Increase Profits

Posted by PITHOCRATES - April 15th, 2012

Week in Review

Ford and GM following the lead of Airbus and Boeing.  Using composite materials to make their vehicles lighter.  And more fuel efficient.  For as Airbus and Boeing have proven, improved fuel efficiency during times of high fuel costs leads to more unit sales (see Ford, Dow to explore carbon fiber use in vehicles by Deepa Seetharaman posted 4/12/2012 on Reuters).

Ford Motor Co and Dow Chemical Co will work to develop cost-effective ways of using carbon fiber in high-volume cars and trucks as the No.2 U.S. automaker moves to cut vehicle weight to improve overall fuel economy…

Weight reduction is one way for automakers to boost the efficiency of their fleets in anticipation of rising oil prices and stricter fuel economy standards for upcoming model years…

Using carbon fiber in lieu of conventional steel can lower the weight of a vehicle component by up to 50 percent, according to the U.S. Department of Energy. Cutting a car’s weight by 10 percent can improve fuel economy by as much as 8 percent.

Carbon fiber, already used in racing cars and products like hockey sticks, is not new to the auto industry. BMW (BMWG.DE), for example, uses the material in its M3 coupe.

Yet carbon fiber’s high cost has blocked its wide-scale use. Industry experts say one way to lower the overall cost of carbon fiber is to find cheaper ways of preparing those materials…

Last month, the Obama administration announced it would provide $14.2 million in funding to spur development of stronger and lighter materials.

Really?  The government needs to fund this with subsidies?  You mean there is no incentive for automakers to make their cars lighter?  I think there is.  If they can make a car lighter without shrinking it down to something slightly larger than a shoe box they will improve fuel economy.  And increase sales.  For what family would not want to buy a fuel efficient car that lets them pack the family in it and take it on vacation?  Letting them take longer trips because the cost of gasoline doesn’t eat up the family vacation budget?  Or let families spend more on their grocery bill rather than on gasoline?  To enjoy more cookouts during their summer vacation?  One thing for certain is that if you can produce a more fuel efficient car that doesn’t trade anything else to get that efficiency (size, range, etc.), people will run to buy it.  And that is what we call incentive.

GM revenue in 2011 was $150.3 billion alone.  So Ford and GM are not doing this to get their hands on that piddling $14.2 million in federal money.  Which was about 0.01% of GM’s total revenue in 2011.  Which is little more than a rounding error.  They’re doing this to increase their market share in an increasingly competitive market.  In 2011 GM, Ford and Chrysler had global market shares of 8%, 8% and 3%, respectively.  If you divide GM’s revenue by 8 that comes to about $18.8 billion in revenue per percentage point.  Which is one heck of an incentive to increase unit sales to get just one more percentage point in market share.  And during times of high fuel costs one way to do that is to make a car cheaper to own by making it more fuel efficient.  That’s why they’re pouring money into carbon fiber technology.  Not because the government is offering what amounts to loose change under the sofa cushions as far as GM is concerned.  Because fuel efficiency equals higher market share when gasoline is expensive.  And market share equals higher revenue.  And profits.

Yes, it’s greed that’s making Ford and GM pursue carbon fiber to increase fuel efficiency.  Which is the best reason.  Because greed requires no government subsidies.

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Major Automakers Feeling the Pressure to try and Sell Electric Cars

Posted by PITHOCRATES - November 28th, 2010

Electric Trains Don’t Use Batteries

Electric trains are powerful.  Provide fast acceleration.  And are very efficient in converting electrical power into forward motion.  And yet the majority of trains are diesel electric.  Why?

Cost.  Diesel electric trains use a diesel engine to power an electric generator that drives electric traction motors.  And a diesel electric train can carry its own diesel fuel to produce its own electrical power.  So when you build track infrastructure for diesel electric trains, that’s all you have to build.  Track.

Electric trains, on the other hand, require a whole lot more infrastructure.  For every mile of track there has to be a mile of electrical power distribution.  In subways this is usually an electrified third rail.  In above ground trains, this is usually overhead wires.  And this electrical power infrastructure is costly.  So costly that few trains are electrified.

(For more information on electric trains, see Electric locomotive on Wikipedia).

And Cars Shouldn’t Use Batteries Either

Now, do you know why they build this very costly electrical power distribution infrastructure for these electric trains?  Because they can’t run on batteries.  Battery-power would not let these trains travel the distances they need to travel.  And so it is with cars (see Major automakers zipping electric cars into showrooms soon by Jerry Hirsch and Tiffany Hsu posted 11/27/2010 on The Washington Post).

Because it relies solely on battery power, the [Nissan] Leaf has a range limited to about 100 miles – maybe more if driven conservatively in cool weather and definitely less if the engine is revved up with the air conditioning running on a hot day.

The [Chevy] Volt can go a lot farther, primarily because it is technically a hybrid rather than a pure electric vehicle. It goes about 40 miles on a single charge. When the juice runs out, a four-cylinder gas engine kicks in as a generator and powers the electric drive train, extending the car’s range by about 300 miles.

I don’t know about you, but the commute on my last job was about 50 miles – one way.  And I drove a lot of that in the dark.  In cold weather.  You ever leave your headlights on accidentally? 

When I was in college, my car’s headlight control was a little loose.  When I slammed the car door it turned my dome light on.  Some 6 hours later, I found that my dome light had drained my battery.  And that was just the dome light.  Imagine if it was the headlights.  Or an electric heater plugged into the cigarette lighter.

You can go Further on a Full Tank of Gas than on a Fully Charged Battery.  And that’s while Using the Headlights and the Heater.

Those rosy mileage estimates are all well and good as long as you are driving in the daytime, during warm weather and going downhill both to and from work. 

You have a digital camera?  If so, tell me how much longer your battery lasts when you don’t use the flash?  You see, that’s the dirty little secret about these electric cars.  Unless you put a nuclear reactor under your hood, you’re not going to have the range to go anywhere but to the corner grocery store.

And speaking of digital cameras, how long does it take to recharge your battery?  I mean, can you put it in the charger and then take it right out and start using it?  Is it like going to a gas station?  Where you stop to fill up your gasoline tank and then drive away minutes later?  Or do you carry around extra batteries because it takes too long to recharge a discharged battery?

Pay More and Get Less when Choosing Electric over Gasoline

People know these electric cars will only provide a fraction of the range, reliability, comfort and safety of a gasoline powered car.  And to add insult to injury, you have to pay more to get less.  People aren’t stupid.  So to get people to pay more for less, the government has to subsidize these lemons.  I mean, cars.

The Volt will start at $41,000. The similar-size Chevrolet Cruze LTZ sedan with an automatic transmission, navigation and other bells and whistles is about $26,000.

Nissan’s Leaf hatchback starts at $32,780. A similarly equipped conventional gasoline Versa hatchback from Nissan starts at less than $17,000.

A $7,500 federal tax credit designed to accelerate entry of electric vehicles into the marketplace will reduce the cost of both vehicles.

These cars are almost twice the cost of their gasoline cousins.  And they can only go a fraction of the same distance on a charge.  The ‘backup’ gasoline power plant on the Volt has 650% more range than the battery.  And you know what?  If you run low on gasoline you can top off you tank and go another 300 miles.  With a dead battery.

Bribing People to Risk their Lives in Battery Deathtraps

Unless you’re taking stupid pills, I can’t see why anyone would pay more for less.  I mean, there’s a reason why the majority of trains are diesel electric even when electric trains are more efficient.  Because they can’t run on batteries.  And electrical power distribution systems are just too costly.

If batteries were viable the government wouldn’t have to bribe people to risk their lives.  And they are.  Risking their lives when they drive these cars.  To get what little range they can out of these, they’re going to be tiny little cars.  And light.  To get as much out of that battery as possible. 

But, to save the environment, we have to sacrifice people.  It’s either us or it.  Think about this when your daughter drives off to college or her job. And what she’s going to do if her charge runs out in a bad part of town.

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