By on August 31, 2009

The LA Times interviews AC Propulsion’s Tom Gage, and sheds some light on what an actual, honest-to-god profitable EV firm looks and thinks like. The short version? Think of the exact opposite of Tesla and you’ll be getting close.

Gage claims to have been a car nut from birth, and after getting an engineering degree from Stanford he worked as a race mechanic before getting an MBA and working for Chrysler for eight years. After working on an abortive plug-in program at Chrysler, Gage left and ended up at AC Propulsion after being impressed by one of its Honda Civic EV conversions.

Besides getting into the EV game way before it was cool, AC Propulsion’s attitude towards its segment is what seems to set it apart from its competitors. AC had sold its own EV version of the Scion xB, and engineered the Tesla Roadster’s forerunner but it’s stayed small and dropped older projects for new opportunities like developing BMW’s MINI E.

In contrast to Tesla’s staggering ambition, Gage knows that AC will not someday become the GM or Toyota of EVs for the simple reason that Toyota or GM will become the Toyota or GM of EVs. “When you see the precision and scale of a huge auto factory, you realize just how hard and expensive it is to mass-produce cars,” he says. “Making parts for 10,000 or 100,000 cars is too much for us. Our goal is to be a participant in the early part of the process and then plan a timely exit.”

AC Propulsion’s deep experience and reasonable ambitions create another unique phenomenon in the rhetoric-over-substance world of alt-energy propulsion: profit. AC’s 35 US employees and 40 Chinese workers assemble about 40 drivetrains per month, each of which sell for about $25k. “We’re very profitable, and that distinguishes us from just about everybody in the business,” Gage says.

And the pragmatism that Gage brings to AC is evident in his daily life. Where the Elon Musks of the world would rather be dead in a ditch than be seen in an un-eco-friendly-appearing vehicle, Gage admits that he often has no choice but to fire up an old internal combustion engine. In addition to a MINI E and an “eBox” (xB EV) he also owns a Toyota and a pair of Volkswagens.

But then AC’s business model isn’t dependent on “change the world” hype. “It’s always been about modifying cars to make them things that people want to drive,” Gage says. Plus, turning a profit never hurts.

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6 Comments on “AC Propulsion: The EV OGs Who Aren’t Changing The World...”

  • avatar
    Paul Niedermeyer

    Good post and article about my long-time favorite EV company. It says it all: the current EV phase is a highly transitional one, and the Nissan Leaf clearly shows the next one. Once EVs are mass produced, the AC Propulsions of the world will make their exit. At least they’re prepared for it.

    Tesla probably knew this reality from early on, which is why they announced the Model S and the even cheaper sedan beyond that years ago. They’re taking the big gamble to try to break into the field where the big boys play. It would not be interesting to Elon Musk to do what AC Propulsion does/did. High stakes are his habit, and it will be interesting to see it play out.

  • avatar

    Is that a Jaguar XK220 in the background?

  • avatar

    It’s a Lamborghini Diablo (in a pretty rare color).

  • avatar

    No reference to Alan Cocconi? He and AC Propulsion (AC for Alternating Current as well as for Alan Cocconi) have been in the background on most of the “production” EVs from the GM EV1 through to the Tesla. Lots of info on their web site, especially at

  • avatar

    I just wish the got the economies of scale working enough that I could pick up one of their AC-150 units for something around $15k – right now it’s about $25k. Also, Tom Gage is a nice guy.

  • avatar

    Great post; I agree with everything…

    …except that Elon does drive a Porsche, turbo, I believe. And my guess is the Elon Musks of the world don’t care *quite* so much about driving eco-looking cars that they would otherwise prefer to be “dead in a ditch”.

    I mean, I’m no fan of Elon, or of the Elon Musks Of The World (whoever they are), but it’s almost painful to watch that strange assemblage of words struggle to form an insult.

    Otherwise, go AC.

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