Wednesday, March 5, 2014

Why Electric Vehicles will Succeed




This really nails it.  The serious promise of the EV is a silent vehicle that arrives quickly on demand, takes you comfortably to your destination and then goes cruising in order to pick up additional traffic while you do what you choose.  All this without serious attention to feeding or cleaning up after or even repair.


The EV can do this and no other protocol is even close.


It will also turn the energy industry over several times but that us no matter.  It is convenience and nothing else.  After all just why did early adopters buy model T’s?


The One Reason Tesla Motors, Inc. and Electric Vehicles Will Dethrone Gas-Powered Vehicles

by Beth McKenna, The Motley Fool Feb 15th 2014 6:30PM

Updated Feb 16th 2014 5:52PM


If you're following the race among alternative-fuel vehicles to dethrone today's king of the road, the internal combustion engine vehicle, you know there are pluses and minuses associated with each type of vehicle. This includes the hybrid electric vehicle; the purely electric vehicle, much in the news these days thanks to Tesla Motors ; and the hydrogen fuel cell vehicle. They all have their strengths and weaknesses when it comes to various factors, such as cost, convenience, environmental- and human-health impact, and so on. Of course, those strengths and weaknesses are largely quite subjective -- they vary based upon whom you ask, as well as who paid for whatever study is being quoted.

My take is that many of the specifics don't matter that much, and that which type of vehicle should win and which one will win could, perhaps, be two different things.

I believe there is one reason it is highly likely that EVs -- with Tesla leading the way -- will take the passenger-vehicle mantle from ICE vehicles: convenience. (Down the road, perhaps, EVs might be dethroned, and it would be terrific for us all if it were by solar-powered vehicles, but that's a long way a-comin.')

The U.S. is a "convenience society"

I realize boiling this big issue down to one key factor seems overly simplistic. However, what the consumer wants, the consumer usually gets -- and what the U.S. consumer, in general, most craves is convenience, in my opinion.

The U.S. is a convenience society. We have drive-through everythings; Netflixkicked Blockbuster to the curb largely because of the convenience factor; GreenMountain Coffee Roasters' Keurig has been phenomenally successful mainly because it's ultra-convenient; and McDonald's and the entire fast-food concept enjoy amazing success largely because of the ease factor.

Let's not forget the poster child of convenience: online shopping. Amazon.com's massive empire was built on convenience. And what's the latest competitive space in that realm? Same-day delivery. Amazon, Wal-Mart, and Google, among others, see huge dollar signs in their corporate eyes in delivering even more convenience into consumers' lives. Otherwise, would Amazon CEO Jeff Bezos be looking into using drones for short-distance same-day delivery? There are surely huge costs involved in getting that enterprise up and running. Google, likewise, apparently plans to spare no expense in capturing the convenience dollars up for grabs. It's been widely speculated, including by The New York Times, that one reason Google's been building up its massive robotics army -- it bought eight robotics companies last year -- is to use them in its retail delivery service.

Electric vehicles are largely "convenience vehicles" for many

EVs allow for the bulk of "fueling" to be done at the driver's home, while he or she is sleeping away. And, when away from home, the driver will largely be able to plug in and charge up while parked at work, a restaurant, a shopping center, and so on. No need to go out of one's way -- even if it's only a few blocks -- to a gas station. Many people like this idea, and I'd venture to say that most of those same people likely don't want to have to make pit stops at hydrogen fueling stations, either.

Additionally, EVs require less regular maintenance and likely fewer repairs than ICE vehicles -- and who wouldn't like that idea? This is a biggie with respect to both cost and convenience. 

Now, EVs might not be considered convenient for some folks because of their range. However, I think the "range anxiety" issue is largely blown out of proportion when it comes to Tesla's vehicles.

The Model S with the 85 kW-h battery has a 265-mile range. Let's somewhat arbitrarily even lop off 15% during poor driving conditions. That's 225 miles.

Americans who drive passenger vehicles drive an average of 12,000 to 13,500 miles per year. That equates to 230 to 260 miles per week. We're talking one or two charges per week, which, for those with a garage, or select other parking facilities, can be done overnight.

Sure, extended drives will mean stopping at a Tesla Supercharger station. I'd guess most people -- especially those with kids -- stop after a few hours on the road to eat and/or use restrooms, anyway. A 20-minute break allows a Model S to get enough juice at a Supercharger station for an additional 130 miles, while a 30-minute break will provide power for about 200 miles. Granted, these sites aren't conveniently located for everyone yet. So it should go without saying that EVs aren't currently a good fit for some. And for some consumers, such as those whose jobs involve regular long-distance driving, even a 265-mile-range vehicle might not ever be convenient.

As to Supercharger stations, Tesla is aggressively expanding its charging network. By 2015, 98% of the U.S. population (and parts of Canada) will live within the Model S rated-range of a station, per the company.

Down the road, EVs should become even more convenient, as battery and charging technology will almost surely improve, so ranges will increase and charging time will decrease.

Foolish final thoughts

Investors might consider asking themselves this question when considering investing in companies that make consumer goods: Will, or do, a good number of consumers largely view this product as adding convenience to their lives? Tesla's EVs pass that test, in my opinion. 


2 comments:

Anonymous said...

I would definitely recommend sticking to the trend of attaching a contoured solar panel to a horizontal surface on the car, either roof or hood, just for that panicky time when you DO find yourself out of range of such a station. Also, the Chevy Volt concept, where a small generator is also onboard to extend your range may be a welcome emergency measure.

atx alke said...

As this article points out electric vehicles of all types (golf car, cars, quads, vans, trucks, etc ...) are extremely affordable. In fact, we can recharge it at home by connecting them to a common outlet and recharging costs are very low (2-3 dollars per charge). They also allow to save even on maintenance and insurance costs. Finally, thanks to the technological development of the batteries, they can ensure greater autonomy. So they are destined to have a huge success in the coming years.