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| EV DOA? |
The UK's much anticipated Plug-in Car Grant, a scheme offering £5,000 off electric cars and the scheme designed by the Transport Department to spearhead the UK's attempt to regain its position as 'the electric car capital of Europe' and lead its carbon reduction programme to reduce emissions by 40%, is off to a slow start.
Just 534 motorists have been convinced so far that £5,000 off an electric car costing £30,000 and roughly one third more expensive than its conventionally fuelled equivalent, is a good deal. Early days as deliveries are just beginning, but the warning signs are there.
This should come as no surprise as all the research indicated that consumers are not prepared to pay such a premium. In 2009, just 55 electric cars were sold, with almost half of them being the G-Wiz, as motorists waited for the new generation of electric cars to come to market.
What they did not expect was that the new EVs would be so expensive.
The grant has enough funding to cover the sale of 8,600 cars this year, but this target looks increasingly unlikely following the figures from January to the end of March.
The UK may well have made a mistake in excluding quadricycles from the grant on safety fears (see my blogpiece below this). The EV market was being driven by low cost, low speed micro-cars which the government effectively killed off by announcing that they would be excluded from the grant.
What happens when customers reject a new technology, product, or way of doing things because it does not address their needs as effectively as a company's current approach? Xerox photocopiers, IBM's minicomputers, in each instance manufacturers listened to their customers, gave them the product performance they were asking for, and in the end, were hurt by the very technologies their customers led them to ignore. Are motorists now asking for conventional cars that happen to be electric - but are not prepared to pay the price of such products - when what they really value is cheap mobility that happens to be clean?
It is frustrating to see this as for years I have argued against excluding quadricycles from subsidies and of the danger of EV vanity projects distracting attention from a successful roadmap to low carbon mobility. You cannot blame the manufacturers, who view the world through a very well defined lens, just one that is blind to genuine innovation given the issues.
I still believe the solution is to make safe, lightweight and low speed vehicles for urban commuting and Monday to Friday second car usage, not to take a big heavy car and add an electric drivetrain to it. The economics are not there yet and there is a danger that EVs might stall as a result.
I am convinced now that we need a two segment solution: an amended quadricycle (or 'Urban M1') segment (see blogpiece and comment below) focused on optimising affordability for second car city commuting; and an M1 segment focused on optimising performance capabilities through fast charging and possibly battery swapping
