Amidst Disappointing Sales, Auto Industry Has A Change Of Heart About EVs

Bertel Schmitt
by Bertel Schmitt

4 Months 20124 Months 2011BMW ActiveE879–Smart electric drive279Chevrolet Volt5,3771,703Mitsubishi i215–Nissan Leaf2,1031,025Toyota Prius plug-in hybrid2,552–Total plug-in11,1282,807EV share0.2%0.1%Table courtesy Automotive News

“A disconnect is emerging between the White House and the auto industry over the short-term future of electric vehicles and plug-in hybrids,” says Automotive News [sub]. The White House wants to go forward. The auto industry is backpedaling.

The Obama administration still wants to see 1 million plug-in vehicles on U.S. roads by 2015, even if that costs more tax payer money in the form of added subsidies.

Already generous handouts could not energize tepid EV sales. Automakers are now “emphasizing more traditional fuel-saving technologies in the short term,” AN says.

“Everybody rushed toward EV vehicles and hybrid vehicles,” said Mark James, director of Lotus Engineering to AN. “Now, they’re going back, and saying, ‘Actually, we need to look at engines.'”

Michael Martin, owner of Dudley Martin Chevrolet in Manassas, Va., found a use for the Volts in his showroom:

“We’re still seeing a strong demand for small cars They’re looking at the Volt, but they’re going to a gas-powered vehicle.”


Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Bob Bob on May 29, 2012

    Why doesn't GM just put a regular hybrid system in the volt to compete with the Prius?

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    • Robert Schwartz Robert Schwartz on May 29, 2012

      Toyota's hybrid system is covered by patents. They would license it to GM, but that costs money. Toyota cross licenses Ford, which has its own patents. GM has its own so-called two mode hybrid system that was adapted from work they did for buses. The system works well, and for trucks and SUVs it is the way to go because it preserves their towing capacity. Unfortunately, the system is expensive to produce, and the only vehicles that GM has produced it for are the full size trucks and SUVs. The GMC Yukon Hybrid is listed at $52K, while the non-hybrid Yukon is $40K. Farago used ridicule GM for the system (he ridiculed GM for everything). But I thought, and I still think, that they should make the hybrid system standard on all non-diesel trucks and SUVs. This might mean suffering reduced profit margins because they would have to price against Ford Eco-boost, but it would help them build the volume to lower their cost to produce the system. They will really need it when CAFE kicks in in a couple of years.

  • Missinginvlissingen Missinginvlissingen on May 29, 2012

    Maybe I'm naive, but I don't see "Disappointing Sales" on the chart. Sales quadrupled in just a year. "EV Sales Quadrupled Since Last Year" would also be an accurate headline, no? Perhaps compared to the "1 million cars by 2015" target, sales are currently disappointing. But if the numbers continue to increase at this rate -- admittedly, a big IF -- you'll crack 1,000,000 cumulative EV sales before 2014 is over. Looks to me like electric cars are EXPLODING.

    • Protomech Protomech on May 29, 2012

      They're doing fairly well, but their sales performance is failing to live up to some of the hype. That doesn't mean they're doing poorly. My understanding is that Volt sales have taken off recently because of the California HOV lane exemption. There was a healthy amount of pent-up demand for EVs, some of that has been bled off after the release of the Leaf and Volt. Sales now are increasing as people get exposure to EVs and become more comfortable with them, and as they become available for sale nation-wide.

  • APaGttH APaGttH on May 29, 2012

    ...“We’re still seeing a strong demand for small cars They’re looking at the Volt, but they’re going to a gas-powered vehicle...” This is the part where I say, ehem, I TOLD YOU SO. Customer walks into showroom to look at a Volt, drives off in a Cruze Eco - that's a win for General Motors. The Cruze Eco is sold for profit, the Volt is sold for a loss. I'd rather GM sell 1,000 Cruze Ecos that a million Volts right now. [INSERT PROVE GM IS MAKING A PROFIT STRAWMAN ARGUMENT HERE]

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    • APaGttH APaGttH on May 29, 2012

      @KixStart ...The people who go into a showroom to look at a Volt are hard core EV intenders and many of them have a Prius to keep or trade. It seems more than unlikely that this group is going to drive out in a Cruze. If they look at the Volt and feel it’s not ready for prime time, they’ll go get another Prius... Did you even bother to read the whole TTAC story before you replied. It seems the Volt is doing a good job as a halo car, just as the early Prius was a great halo car for Toyota. Customer walks in to Toyota to look at a Prius circa 2003, drives off in a Corolla. WIN for Toyota. Prius was sold at a deep loss at the time, Corolla equal profit. The Prius is quite profitable for Toyota - not sure about the plug-in model, but given the top version is $40K - suspect they are at least break even. Lithium-ion batteries are serious bank.

  • Southerner Southerner on May 30, 2012

    Dear Shaker, No. Each dollar wasted by DoD is far more beneficial to the nation than one "invested" in green....anything.

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