Electric Cars – How far will they go?

by Paul Eisenstein

A New Kind of Car

Just days before the White House giveaway, in early August, Nissan Motor Co. CEO Carlos Ghosn grabbed the spotlight in Yokohama, Japan. But the dedication of the carmaker’s new corporate headquarters was just the backdrop for the unveiling of the much-discussed but as yet-unseen Nissan Leaf. Due to market in roughly a year, the Li-Ion-powered 5-door is part of a grand plan by the Brazilian-born Nissan Chairman Carlos Ghosn to take the lead in the electric car market. Initially, Leaf will be marketed to fleet buyers who can control and monitor the car’s use and performance, but by 2012, Nissan believes it will be able to market Leaf to consumers.

Of course, there is a drawback—a maximum 100-mile range. To downplay that restriction, Nissan plans to equip the BEV with an advanced infotainment system that will not only help you navigate to your destination, but constantly monitor Leaf’s state of charge and show the driver the way to the nearest charging station.

“This car represents a real breakthrough,” said Ghosn, who also serves as CEO of Nissan’s French alliance partner, Renault. “We have been working tirelessly to make this day a reality—the unveiling of a real-world car that has zero, not simply reduced, emissions.”

New Technology, New Restrictions

Nissan isn’t the only automaker hoping to find a market for pure battery vehicles. Ford Motor Co. will launch a BEV version of its new Transit Connect van in a little more than a year, and follow it with a Focus battery car, in 2011. Toyota also promises a BEV by then, though the maker seems to be reacting more to competitive pressure than out of a sense that there’s a real market waiting for the technology. There are serious limitations to Li-Ion technology, cautions Jim Lentz, the Japanese automaker’s top-ranked American executive, underscoring his belief that there is no “silver bullet, single solution to the need for alternative power.” Toyota may pass on Lithium for now.

General Motors officials echo that point, noting that they’re working on everything from hydrogen-powered fuel cell vehicles to mild hybrids, like the Saturn Vue. But the automaker has been making plenty of hay over the 230 mile-per-gallon rating its new Chevrolet Volt is expected to receive under a proposed fuel economy measurement system designed specifically for electrified vehicles.

electric

Leading the Way—The Volt

GM is also promoting the fact that Volt won’t be limited to local jaunts, like pure battery vehicles. Chevy’s so-

called “extended-range electric vehicle” or EREV, will carry just enough batteries to run 40 miles on electric power, though GM Vice Chairman Bob Lutz, asserts that will be more than neccessary “for 70 percent of American commuters.” On a longer drive, Volt’s small internal combustion engine will fire up. A serial hybrid, the engine serves only as a generator, providing power to the motor driving Volt’s wheel, or to recharge the battery.

Though its official introduction doesn’t come until the fourth quarter of 2010, GM just began low-volume production of Volt, which will be put through extensive testing over the next 14 months.

The automaker, newly emerged from bankruptcy, can’t afford any big unforeseen setbacks in the program. The 230-mpg rating given to Volt is generating plenty of controversy—as is the fact that Leaf will be rated at 367 mpg. How, ask the skeptics, can that happen when the Nissan BEV only has a 100-mile range?

Better, But Cheaper, Too?

Even the assertion that battery cars will be cheap to run is a matter of debate. It’s true they’ll likely be more affordable than a gasoline-powered vehicle if you’re only looking at energy costs. Using off-peak electricity, GM estimates it will cost just $0.40 to fully charge Volt. With Leaf, a dollar would cover its 100-mile range. Even plugging in at peak hours would do no more than double

to triple those numbers, which of course would still be significantly less expensive than running on gasoline.

Of course, that’s only part of the equation. GM’s EREV is expected to command a price tag of somewhere between $35,000 and $40,000 when it launches in late 2010, nearly twice as much as a comparably-priced sedan. “That’s high,” admits Henderson, but he stresses that “new technology is always more expensive.” The goal is to boost volumes, enhance the economies of scale, and then get to Volt “gen-two,” in industry lingo, as quickly as possible.

Toyota saw a nearly 50 percent drop in the cost of its second-generation Hybrid Synergy drive, used in models such as the popular Prius. But that didn’t happen

with the recently-released, third generation hybrid, acknowledges Lentz. “We got there with the motor, the controllers and most of the rest of the hardware,” he notes, “but not with the battery.”

To make a business case for battery technology, manufacturers are looking at a variety of non-traditional approaches. “We may opt for selling consumers the car but leasing them the battery at a price roughly equal to what they’d expect to spend each month on gasoline,” suggests Tom Lane, Nissan’s director of global product planning. Nissan is just one of several makers considering alternatives to the eventual disposal of automotive Li-Ion batteries. Though they might no longer be good for use under the hood, they’d likely have enough life left, says Lane, to work as back-up storage at power plants, particularly with green energy generators, like wind, solar and wave, that can suffer tremendous shifts in power output moment to moment.

How Far Will it Go?

Cost is just one of the issues with batteries, however. Range is arguably even more of a challenge. Tesla founder and Chairman Elon Musk insists the technology is making significant gains, and he hopes the 200 mile range of his company’s little 2-seat Roadster, it hopes, will double by the middle of the coming decade.

Some of the most promising claims are being made

by the Chinese automaker, BYD. Short for Bring Your Dreams, the company actually started out as a Li-Ion battery maker and continues to serve as one of the largest suppliers to the cellphone industry. Technologists note there are more than a dozen distinct families under the broad Lithium-Ion umbrella, and BYD claims its Lithium Ferrous Phosphate chemistry will deliver 250 miles on a charge of as little as three hours. Better yet— at least if the technology delivers as promised—BYD’s battery comes in at $500 per kilowatt hour, roughly

half what other automakers are targeting for other lithium-ion formulations.

“No bloody way,” asserts Tesla’s Musk. But BYD’s technology is enticing enough that mega-investor Warren Buffet has invested $230 million in the Chinese firm— garnering 10 percent of its stock.

Where Will the Batteries Come From?

According to Nissan battery chief, Toshiyuki Motohashi, his company and its partner, NEC, have found a way to produce flat, or laminate batteries, rather than conventional, cylindrical cells—such as those used in the Tesla Roadster.

That saves space and weight, meaning in practical terms, more energy stored and longer range.

Nissan, meanwhile, has set up a variety of joint ventures around the world, including a consortium in Israel in which a network of battery swap stations will

be established. Though the Israeli EV can be recharged like a conventional battery car, it will also be able to have its batteries switched out almost as quickly as a gasoline- powered vehicle could refuel.

The push to electrify the automobile has created some strange bedfellows. Virtually every major automaker has established a relationship with one of the leading battery manufacturers. GM, for example, will use some of the federal battery grant money to set up a factory in suburban Detroit where it will assemble battery packs for the Volt. But the basic manufacturing will still be done in South Korea, by its partner, SG Chem.

And that underscores the concerns of the Obama Administration, which fears that Asia—notably Japan, China and Korea—could effectively gain control of the most fundamental components of the battery industry without a concerted U.S. effort to set up a competitive manufacturing base in the States. Right now, there is only one domestic, high-volume producer of Li-Ion batteries, a factory in Indianapolis that’s a subsidiary of Ener1, Inc. That battery maker it turns out, is now the largest stakeholder in the Norwegian-based BEV manufacturer, Th!nk, which emerged from bankruptcy protection at the end of August, and should restart production of its 2-seat Th!nk City battery car by year’s end.

segwayNot Just for Cars

One of those companies that sees expanded opportunities is Segway, the producer of the quirky, two-wheeled Personal Transporter. In April, the company unveiled a prototype 2-seater, dubbed PUMA, for Personal Urban Mobility and Accessibility, that it developed in a joint venture with GM. PUMA has only two wheels, but rather than a conventional, tandem design, PUMA’s passengers ride side-by-side, as they do in a conventional automobile, thanks to the same stabilization system used in Segway’s one-person PT. A more advanced version of the skeletal prototype, shown at the New York Auto Show, could be revealed by early next year.

Segway has already drummed up support, including some financial assistance, from a number of cities around the world, including London, which sees an opportunity for the downsized alternative to a conventional automobile.

There’s been similar interest by traffic-snarled cities, like London, in smaller BEVs being developed by BMW’s Mini division and by the Mercedes-Benz sibling, Smart.

One of the curious paradoxes of our day, notes Professor

Bill Mitchell of MIT’s Smart Cities program, is that the more urbanized the world gets, the more its citizens want their own personal transportation.

So vehicles like Volt, PUMA or the Smart ED (for Electric Drive) have tremendous potential. But Dr. Mitchell cautions that just because a vehicle is green won’t be enough to win over an audience. “You can’t get people to accept a vehicle solely on the basis of saving the planet,” he stresses. “It also has to be fun and fashionable.” And functional. And reasonably affordable.

Will it Work?

That underscores the risk the industry is facing with its increasing emphasis on Li-Ion technology. It works in cellphones and laptop computers, but whether it will deliver reliably in the challenging environments faced by the typical automobile is yet to be proven. But with government regulators in most major markets enacting tougher emissions and fuel economy standards, automotive

planners simply can’t wait to find out for sure. In turn, governments can’t afford to let the industry fail, which is why the Obama Administration’s cash infusion is both critical and unavoidable.

The U.S., of course, isn’t the only country making a push into battery power. Governments from Beijing to Berlin are coming up with subsidies for manufacturers and the new generation of suppliers that will be needed to move the world of the electric automobile forward. Some traditional parts manufacturers are hoping to get into the game. Those who don’t could face an increasing struggle to survive should the internal combustion engine become as dated as the buggy whip. But how soon that will happen is uncertain.

There are plenty of skeptics who say it never will. They insist battery technology is simply too inefficient and expensive. And in some segments of the market, they may be right. GM’s new product development director, Tom Stephens, notes that it takes 100 litres of batteries to store the energy of a litre of gasoline. That may be fine for small vehicles, like Volt or Leaf or the Tesla Roadster, but it likely won’t work, without massive breakthroughs, when you’re talking pickups and SUVs. For his part, Nissan CEO, Ghosn, believes that even if the industry is successful, only about five to 10 percent of the vehicles produced by the end of the next decade will be battery powered—either pure BEVs or plug-in type vehicles that run primarily on electric power.

Of course, financial incentives can move markets. The recently-concluded Cash-for- Clunkers program convinced more than 600,000 Americans to trade their old and inefficient vehicles in for higher-mileage small cars and hybrids. The government of Ontario is looking at financial incentives that could help make as many as 10 percent of the vehicles sold in that province battery-powered. And the German government hopes to put as many as 1 million battery vehicles on the road by 2020.

The cost of this transformation is, for the moment, incalculable. It will require not just a

shift in design, engineering and manufacturing at the assembly line level, but a transformation among automotive suppliers. Governments will clearly have to become involved, supporting manufacturers, encouraging new research and even laying out plans to modernize the electrical grid systems that will be needed to provide power to potentially millions of battery vehicles. But if the fears outlined by proponents, ranging from climate change to declining supplies

of petroleum, are true, the price tag will be a bargain in the long run.

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