Don't Let Electric Vehicles Leave You Stranded

It never worked to put the cart before the horse in the old days. In modern times, the electric vehicle will similarly have a hard time taking off before a real electric infrastructure is built.

The Charged 2011 EV Symposium in Silicon Valley recently received some unplanned negative press when a few participants were left stranded by their all-electric Nissan Leafs. One participant stayed late to charge the vehicle and still required a ride home from a gas-guzzling vehicle. Talk about embarrassing!

To help fix the problem, Nissan is testing a truck that charges stranded Leaf vehicles in Japan. That's an innovative solution, but it just doesn't solve the problems standing in the way of more widespread adoption.

The problem is twofold for electric vehicles. They don't have enough range to be more than short-commute vehicles, and when you're in a pinch it's hard to find a charging station. So how do we invest in the electric-vehicle movement without being left out in the cold?

Range anxiety run amok
GM
(NYSE: GM  ) and Fisker are going with plug-in hybrids, which eliminates reliance on the outlet. This approach essentially makes the transition to an electric vehicle easy and painless for drivers. But other manufacturers are taking a different tack.

Tesla Motors (Nasdaq: TSLA  ) is all-electric but is the one competitor with enough charge to make more than a commute to work. When the Nissan Leaf runs out of electrons at 73 miles, the Tesla Roadster still has 172 miles left, give or take. Ford (NYSE: F  ) is going electric with the new Focus, and Toyota is putting Tesla's power behind its Rav4, which is under development. Following are four of the most popular electric vehicles and their electric driving range.

Vehicle

Electric Range

Gas Backup

Tesla Roadster 245 miles No
Nissan Leaf 73 miles No
Chevy Volt 35 miles Yes
Ford Focus Electric ~100 miles No

*Ford Focus does not have an official EPA range yet.

Until those ranges increase to closer to 300 miles, it's a long shot that electric vehicles will enjoy wide adoption. Betting on electric vehicles has already been a disaster for A123 Systems (Nasdaq: AONE  ) and Ener1 (Nasdaq: HEV  ) investors. Delays and lackluster sales have meant that demand isn't soaking up huge amounts of the supply that both companies have built.

The electric-vehicle market is risky for investors right now, and Tesla Motors is the only company I would consider investing in. But there is an adjacent market that's taking off to support the electric vehicles where risks aren't nearly as high.

To the rescue
The first hurdle the electric-vehicle industry needs to clear is to get an infrastructure of chargers in place for public use. And progress on this front is happening faster than you might think. AeroVironment (Nasdaq: AVAV  ) , General Electric (NYSE: GE  ) , and Siemens are working on just such an infrastructure, and they’re expanding it quickly.

Oregon recently selected AeroVironment to build the first phase of its "Green Highway" along Interstate 5. The company will provide "Level 3" (480 V) fast-charging stations that work in a similar way to filling at a gas pump for drivers. Since late 2010, the company has built more than 2,000 lower-voltage "Level 2" stations across the country.

If you want to see just how quickly the infrastructure is being put in place, ChargePoint and PlugShare have easy-to-use apps that show where chargers are available. Since all a station needs is an electrical connection, one can be built in little time and almost anywhere.

AeroVironment, which also makes military drones, is my pick in this rapidly growing sector. Last quarter, revenue increased 39% overall, and the efficient-energy systems division grew by 119%. The business should continue to get stronger as the charging infrastructure gets built out.

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Fool contributor Travis Hoium owns shares of AeroVironment. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings, or follow his CAPS picks at TMFFlushDraw.

The Motley Fool owns shares of Ford. Motley Fool newsletter services have recommended buying shares of AeroVironment, General Motors, and Ford. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (9) | Recommend This Article (9)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 10, 2011, at 10:26 PM, MHolt9 wrote:

    The Chevy Volt has a battery only range of only 35-50 miles, but it already has the 300 mile range to which the author of this article (Travis) refers (over 300 miles, in fact) since the gasoline powered generator can provide the electric motor with juice for an additional 300 miles or so. For my daily 40-mile round trip commute, I don't use a drop of oil. But, I have taken the car on a few long trips to nearby states for both business and pleasure, so after 3,490 miles, I have used 38.5 gallons of gas.

    Charging stations are still few and far between, but I was able to charge my Volt for free at a commuter train parking lot when I decided to park my car just on the outskirts of NYC to avoid the traffic and half-crazed taxi drivers! It will take a while for the charging station infrastructure to be developed, and for technology to advance to the point where batteries can be safely recharged in about the same time it takes to refill a gas tank (rather than the 3 hours now required), so those who want to get us on the road to a better future (pardon the pun) will likely prefer the Chevy Volt or the Fisker Karma at this stage of development.

    In my opinion it will not take nearly as long for these two cars to catch on as Travis expects. Driving the Volt, for example, is so enjoyable, I'm sure it will become popular as soon as people get around to taking one for a test drive.

  • Report this Comment On June 10, 2011, at 11:33 PM, jimmy4040 wrote:

    Hybrids are terrific, but all electrics are currently a dead end. Even the level 3 chargers cited in the column take 30 minutes to "refuel". This is a gimmick, nothing more. There are only about 1200-1500 all electric vehicles in the whole US, total.

  • Report this Comment On June 11, 2011, at 6:49 AM, KurtEng wrote:

    Electric cars are a good idea, but I don't think they will ever get over 50% adoption. People who have relatively short commutes and access to an outlet that can be used to charge the car overnight could save a lot of money with electric. It will be a long time before it's a good idea to drive cross country an electric car, though.

  • Report this Comment On June 11, 2011, at 7:30 AM, glocker62p wrote:

    And where do you think the electricity to charge the cars is coming from? Trees? Corn? Like Manna from Heaven? No. It'll come for coal and nuclear plants and many more plants will have to be built if this "dream" actually comes to fruition. If the majority of cars in the US are ever electricity powered, solar, wind and geothermal will never provide the necessary capacity. This whole idea is many things, and one is "full employment" for utility companies. They're already drooling.

    Those of you who doubt this will just have to wait and see huh?

    And one other thing. Check into the pollution the battery plants create. Where they're made and what fuel is used to get them to the cars into which they're installed.

  • Report this Comment On June 11, 2011, at 11:50 AM, Bytefield wrote:

    "Delays and lackluster sales have meant that demand isn't soaking up huge amounts of the supply that both companies have built."

    False. Hilariously false. A huge supply of electric vehicles, where on Earth did you get that idea? EVs are being manufactured at a trickle and sold at a premium. But don't take my word for it:

    "We have limited supply of Volts - as of earlier this week, our records indicated that there were fewer than 200 available on dealer lots (some sites will show more as dealers often post vehicles with delivery dates in the future). Many of those on the ground are in the process of sales as well, so again - supply is very thin (especially when you consider we have nearly 600 dealers in launch markets)." --GM spokesperson Rob Peterson, June 3, 2011

    http://green.autoblog.com/2011/06/03/chevy-volt-sales-whats-...

    "The numbers show that Nissan is selling more Leafs in the U.S. with each passing month. According to Nissan, U.S. sales of the Leaf hit 1,142 in May, up from 573 in April and 298 in March. Based on orders and hand-raisers, Nissan officially expects to close out 2011 with U.S. sales of its electric hatch exceeding 10,000 units and, at least as we see it, there's no reason to believe that the Japanese automaker will fall short of hitting that target."

    http://green.autoblog.com/2011/06/06/report-nissan-leaf-sale...

    Nissan customers reserved the entire 2010 Leaf production of 20,000 last year. Deliveries are only beginning to make a dent in that total. If you are not on waiting list, you are not getting a Leaf this year, unless you buy it on eBay. That's why the few sold on eBay went for well above MSRP, even though used vehicles don't qualify for the $7500 tax credit.

    Now if Nissan has them sitting in the showroom for $25K new after rebate, why are people paying $39K on eBay, hmm?

    Travis Hollum seems to specialize in anti-EV screeds with little substantiation. May I suggest a more Foolish level of fact-checking in the future?

  • Report this Comment On June 11, 2011, at 4:52 PM, neamakri wrote:

    If you are waiting for an electric car that goes as fast and as far as a gasoline car, the sun will burn out sooner.

    Judge electrics by what they are. The electric car is extremely useful as a second household vehicle. I used my electric motorcycle to commute 19 miles to work. It was also very useful for short errands; no wasting gas to warm up an engine! It was very satisfying. I sold it and am in the process to buy a newer model electric motorcycle.

    Electric vehicles are generally far less expensive to operate. My motorcycle cost about one cent per mile, or equivalent to 350mpg. Electric power coming through your household outlet is approximatley 50x cleaner than burning gas in your car, so less pollution.

    Lastly the people who leased the GM EV-1 loved them. GM, however, cancelled the leases and crushed them, even though people begged to purchase them. (Who killed the electric car?)

  • Report this Comment On June 11, 2011, at 6:08 PM, jimmy4040 wrote:

    byte:

    Leaf sales for the year are 2167 in the US by the end of May. They had a bigger May than I anticipated so my figures were off.

    No matter how you feel about climate change, hybrids are a much better idea. It's good that they are manufacturing the Leaf now, in order to improve the engineering 5-10 years down, but the all electrics will make no impression on sales in that time frame. You're talking about a nation that has 240 million non-commercial vehicles.

  • Report this Comment On June 12, 2011, at 1:30 AM, baldheadeddork wrote:

    When forecasting hybrid and pure electric sales, don't forget to factor in the increases in fuel economy made by regular old internal combustion engines.

    Advances in engine controls and transmissions have already increased mileage substantially. When we last bought new cars in 2005, there were very few cars that got 35mpg highway that weren't hybrids. Now that's typical for a midsize sedan and 40mpg highway is the standard in the compact class.

    It's not done yet. By 2014 almost all new cars will have stop-start systems that turn off the engine when the car is stopped. This will raise city fuel economy by 10-15%. And this week Ford announced a new 1-liter engine using its EcoBoost system that will make the same power as their current 1.6 liter engine but get "significantly" better fuel economy. If it hits the 20% improvement Ford is mentioning, that would put the Focus and Fiesta at almost 50mpg.

    Then there are the new transmissions coming soon. In the last decade, automatic transmissions have moved from having four to five and then six speeds. That improved fuel economy because more gears means the engine can run at lower RPM's for a given road speed while still being driveable. Now there are eight and nine speed gearboxes planned to enter production before 2015.

    Put these together and it's likely that a midsize sedan of just four years from now will match the fuel economy of a Prius. The turbocharged engine and new transmissions will cost more than current parts, but still thousands less than a hybrid powertrain.

    Electrics have a lot going for them, but range will continue to be an issue and building the charging infrastructure to match the ease of use of a regular car will be expensive and take years. And unless there is a massive breakthrough in battery technology, electrics will continue to cost much more than conventional cars.

    I think ultimately we'll end up skipping over hybrids and pure electrics. The next fuel is going to be natural gas. It works in regular internal combustion engines so you won't have to reinvent the car, and there is a distribution network already in place.

  • Report this Comment On July 03, 2011, at 11:27 AM, iknowvehicles wrote:

    The Chevy Volt is less efficient then a comparable ICE version (by this I mean same power plant for it and ICE=Internal Combustion Engine) under ALL circumstances. Burning fuel to make mechanical motion, to turn into electrical power, to store, unstore, then turn into mechanical motion again is the reason. You are hauling around a generator and all of the hardware needed to convert mechanical energy to electrical even during electric only mode. It also requires you to have pieces and parts of both an ICE and EV system driving the costs, complexity, and weight through the roof.

    The eMPG numbers are garbage. Politically motivated to make the consumer think they understand things, while pushing an agenda. If you look at the efficiency numbers to produce the electricity, transport it to the vehicle via the grid, store it and then use it to move the vehicle, especially in cold weather states, the car as a whole requires MORE energy per mile not less. The average green person only understands they want to be greener and all one has to do is produce values. I am not insulting anyone Im explaining the facts.

    Let's review Tesla and their "superior" battery tech. They don't have any, at all. They buy batteries from Panasonic, as do many other OEMs. The sales to other companies are in the hundreds and are battery packs not some superior battery technology. As an OEM they are sunk coming out of the gates. They are backing the loser in the alternative fuel race, have yet to produce cars for the mass market at line rate, heck they have to buy almost all of their components from their competitors. Sincerely the idea that they will produce 20,000 cars, using essentially the same components as everyone else, and turn at profit, when the giants can't is just plain silly. Trust me all of the OEMs (yes Nissian too) lose money on every vehicle. Alot of money.

    The saving grace for this discussion is the stock market is irrational and consumers can be blind to the details. EVs, EREVs have been around forever (after all diesel locomotives are just great big EREVs) and definitely have there niche but as pasenger cars trying to compete against ICEs only the EREVs can come close and they are less green.

    Btw design them for living. Why do it if I think they are inferior? If the government and public all of the sudden wanted to run vehicles on clown tears to balance the world's mana supply... I'd grab my laptop, a blow torch, a set of rusty pliers, and go visit a circus. After all I need to eat and only occasionally feel the need to shout down the well of the internet to sooth my guilty feelings.

    Keeping it on investment advice: Stay away from EVs they aren't performance competitive, won't be "until the sun burns out", and consumers aren't a forgiving bunch. Costs are through the roof for the components, the low numbers sold mean tooling/engineering/development/validation costs are astronomical per unit.

    EREV (like the Volt) can compete performance wise against ICE but at a complexity hit. As long as the public swallows the malarky about them being green and are willing to pay that green premium it works. The problem becomes when the fad fades and they are still more costly will the eMPG numbers keep them buying? No is my guess

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