Electric cars and plug-in hybrids took a beating on reliability, testing, and sales over the winter: $40,000 Tesla batteries bricking, a Fisker dying at the hands of Consumer Reports testers, a bit player going under, production suspended for five weeks on the Chevrolet Volt. Taken together, critics say, it proves electric vehicles (EVs) and plug-in hybrids (PHEVs) have finally been exposed as overpriced frauds.
The less sexy explanation is randomness: Stuff happens at an unordered pace, like plane crashes that come in close succession with long gaps after that. Meanwhile, new electrics (Nissan Leaf update) and plug-in hybrids (Porsche) are being announced. Here’s why the randomness answer may be the better explanation for what ails green cars.
Chevrolet Volt production suspended: They’re running out of early adopters
GM is suspending production of the Chevrolet Volt for five weeks to bring supply and demand into balance. Critics say it proves the Volt is a dumb idea. At the very least, the Volt is selling below projections: 7,671 sold in 2011 vs. 10,000 projected; 1,626 in the first two months for an annual rate of 10,000 vs. the 45,000 originally projected. “The price premium on the Volt just doesn’t make economic sense for the average consumer when there are so many fuel-efficient gasoline cars available, typically for thousands of dollars less,” Lacey Placey, the chief economist of Edmunds.com, told CBS News.
The Volt sells for $41,500 minus an available $7,500 federal tax credit, or $34,000. At today’s gas prices, you’d need 12-15 years to pay back the difference between the Volt and a roughly equivalent Chevrolet Cruze gas-engine car. A couple of battery-unit fires (since resolved) didn’t help the Volt’s reputation. A snippy Fox News story on the Volt and misstated costs of electricity for refueling (national average isn’t $1.16 per killowatt hour; it’s a tenth of that) hurt, too. What’s hurting the Chevrolet Volt most is that even in a country of 330 million people, it’s thousands not millions willing to spend an extra $15,000 up front to advance the cause of alternative energy. Many of them already bought. But if the price of gasoline hits $6 a gallon, or the Volt-Cruze differential falls to $5,000, sales will perk right up.
The verdict: Not enough early adopters for Chevrolet. It’s less cool being the second on your block driving a Volt.
Bright Automotive shuttered: Feds wouldn’t fork over $400 million
Bright Automotive had planned to produce plug-in hybrid utility vans for the commercial market starting in 2014. Like the Volt, the vans (on paper) would go 40 miles on electric power, then switch to a combustion engine. Bright sought $400 million in federal Advanced Technology Vehicle Manufacturing loans in 2008 and says it got four “near final” conditional commitment letters but no money. In February Bright said it would cease operations. The Department of Energy says it has to balance support for new technologies with the protection of taxpayer dollars (a novel concept) and offered consolation: “We understand this is a difficult day for Bright.”
The DOE this month rejected Carbon Motors’ loan request to build a high-efficiency, purpose-built police cruiser that would use BMW diesel engines. Those denied loans have expressed “outrage” and then blamed politics. It’s also possible DOE saw something that made these loans seem less desirable than loans it dished out to Ford, Nissan, Fisker and Tesla.
The verdict: Says more about staking your company to the federal piggy bank than about the future of alternative energy vehicles.
Tesla battery bricks: the $40,000 oops
A handful of owners of the all-electric Tesla Roadster have come back to their cars to find the batteries dead. Not dead as in needs a recharge, but dead as in “$40,000 worth of dead, and it’s not covered by warranty.” Many fingers have been pointed. Tesla says the manual warns you not to leave a partially discharged Tesla for long periods; owners say there’s no automatic safety disconnect to end parasitic losses when the batteries get to a critically low level. (Most laptops do that to protect your data.)
There’s now a new word in the lexicon: bricking, meaning a device lacking power that is no better than a brick. About 2,000 Roadsters were built; Tesla says fewer than 10 (by Tesla’s count) were affected. Several battery engineers told The New York Times that relatively modest design changes would have prevented the problem. A Nissan spokeswoman said the all-electric Nissan Leaf will “never means never” discharge completely.
The verdict: Tesla seems to be the only car company with bricking issues. If simple design changes could have saved these batteries, Tesla cut one corner too many to rein in costs.
Fisker Karma dies at the hands of Consumer Reports: Ridden too hard or built too sloppily?
Probably the worst news for the EV/PHEV market is the death of a Fisker Karma during testing by Consumer Reports, which bought the car for $108,000 (equal to 3,700 one-year subscriptions, less whatever they get back selling the Karma used). The magazine’s testers ran the brand new, 5,400-pound Karma up to 65 mph for speedometer calibration, got an error message, coasted to a stop, and after that the best they could do was let it sit, restart and move the vehicle, then see it lock again. It had to be flatbedded to the local Fisker dealer where the battery and inverter cable were both were replaced (a multi-thousand-dollar repair).
CR wrote, “In fairness, the challenges Fisker has surmounted in going from a start-up to a bona fide automaker over a short period are monumental. Some birthing pains are not unexpected, especially as it is presumed the company faced significant timeline challenges to reach milestones necessary to obtain funding. Further, the Karma is a leading-edge car. Check the reliability track record for other companies pushing tech boundaries (ahem, Mercedes-Benz) and you will often find hiccups.”
Fisker CEO Tom LaSorda in an open letter said the car performed exactly as it was supposed to when it encountered a fault. But nonetheless there was a fault. LaSorda used a variation on the previous-generation Jaguar defense: Sure, we had an electrical problem or two, but wasn’t the dealer grand in fixing it this time, and the next time as well? And there’s likely to be a next time. In its most recent blog post, CR said, “Just this weekend, for example, the speedometer and energy meter display disappeared when driving, on top of having several other rogue warning indicators appear last week. It is expected we’ll be revisiting the dealership soon. We’ve had cars in the past that have been troublesome, but never anything like this.”
The verdict: Lots of things can go wrong for a startup tech company building cars, and most of them have. The running gear isn’t all that different, conceptually, from a Chevrolet Volt, so the culprit may be how Fisker is dealing with the complexity. The biggest loser is the publishing business, which can’t seem to write a headline more original than “bad Karma.”