These Companies May Have the Answer to Gas Price Woes

According to a recent poll, nearly 57% of Americas say they won't buy an all-electric car, no matter what the price of gas becomes. At first glance, this seems like it could be problematic for car dealers like Ford (NYSE: F  ) , Tesla Motors (Nasdaq: TSLA  ) , and General Motors (NYSE: GM  ) , which have broken ground on engineering electric cars like the electric Focus and Volt. So is it true that the majority of Americans are not interested in electric cars?

The problem with electrics
When you look at the wording of the poll, electric cars are defined as "an electric car that you could only drive for a limited number of miles at one time." And when an electric car is defined like that, who would want to buy an electric car?

Yes, most people's commute is less than Nissan (OTC: NSANY) Leaf's EPA-rated 73 miles on a charge, but if the car can only go that far, and electric charging stations are not exactly as plentiful as gas stations, of course people are going to be less than enthused to purchase electric cars.

Add to that the fact that electric cars are generally more expensive than traditional gas-fueled cars, and it's no wonder that Americans said they wouldn't be interested in buying electric.

So since Americans don't want electric cars, car dealers should abandon their quest to make them, right?

Wrong
The problem with most electric cars is that they can only go a short distance on one charge, and even if you can find an electric charging station, it takes awhile to charge -- Tesla's Model S is capable of recharging in 45 minutes using a fast charging station, but Nissan's Leaf takes anywhere from 30 minutes at a 480-volt quick-change station to about seven hours at a 220/240-volt station -- not exactly quick compared to refilling at a gas station.

But what if an all-electric car was capable of going 220 miles on one charge and could be recharged in a fraction of the time? Could that change people's minds about electric?

Lithium to the rescue
Luckily for consumers, car manufactures have recognized that greater distance, quicker recharging time, and more cost effective vehicles are needed in order to compete with current gas-guzzlers. With that in mind, many manufacturers are either using lithium ion batteries, and/or researching how to make these batteries and cars more cost-effective, while shortening battery recharging time. And the good news is that lithium ion batteries are already capable of going up to 220 miles on one charge.

Plus, on top of researching how to shorten recharging time and producing more cost effective vehicles, car and battery manufacturers are working with traditional gas stations and even hotels in implementing charging stations that allow people to stop and recharge electric batteries.

Rephrasing the question
If the above poll questioned readers and asked, "Would you be interested in buying an electric car if it had the same capabilities of a gas car, and was similarly priced?" what would your answer be? I know that personally, my answer would be a resounding, "Yes!"

True, car manufactures have a way to go before we see electric cars on the same level as gas cars, but with car companies like Ford, Tesla Motors, General Motors, Nissan, and Honda already developing electric cars, and researching how to make them more comparable to gas cars, electric cars may very well have a promising future. J.D. Power and Associates expects pure electrics car sales to be around 11,000 this year, and that number is expected to rise to almost 100,000 by 2015.

Now the question is whether car manufactures can pull it off. I think they can. Manufacturers have already made huge strides in the development of electric cars -- now they just need to perfect them.

What do you think? Can electric cars overcome the obstacles they face to become a real threat to gas-guzzlers? Sound off in the comments below. Or if you want to keep up with the companies mentioned above, click on the links below to add them to your watchlist:

Fool contributor Katie Spence really wants an electric car because gas is just ridiculous! She does not own share of any company mentioned above. The Motley Fool owns shares of Ford Motor. Motley Fool newsletter services have recommended buying shares of Ford Motor and General Motors. 

Try any of our Foolish newsletter services free for 30 days. We Fools may not 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 (4) | Recommend This Article (6)

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 August 04, 2011, at 11:59 AM, Brettze wrote:

    We still enjoy the fragrance of tailpipe exhaust ???

  • Report this Comment On August 04, 2011, at 12:50 PM, money4eds wrote:

    Everything can't run on batteries. We don't have the raw materials and we can't really deal with the waste.

    Liquid fuel is here to stay for a long time.

  • Report this Comment On August 08, 2011, at 9:29 AM, kledeen wrote:

    Fuel savings are only part of the story. Consider the fact that pure electric cars don't have any of the complicated parts (ie engine and transmission) that are the bane of internal combustion cars. That means virtually no maintenance beyond tires, brakes, shocks. No tune ups, no oil changes, no more transmission problems (since there isn't one). Just an electric motor, a battery, and a computer.

    And --- it only takes minutes to replace a motor. That means you can upgrade your car five years from now at minimal cost - not like replace an engine in a gas powered car.

    The implications for car companies that rely on after-market parts for a substantial portion of their profits are enormous.

    Plus, the traditional car companies have the bulk of their technology talent tied to refining and enhancing internal combustion engines. It's where they gain competitive advantage. Not so when everyone uses the same electric motors.

    My prediction - electric cars will dominate the market sooner than many expect.

  • Report this Comment On August 09, 2011, at 10:39 PM, DDHv wrote:

    Even after peak oil, the amount of material/person needed to make electric cars is a small fraction of the amount of petroleum/person. Electric scooters make sense, Prius types that use the electric as an acceleration boost and recover some on braking make sense, stop-start makes sense, electric railroads or trolleys in urban areas make sense. (search on the J-pod). BEVs only make sense with urban delivery vehicles and batteries that can handle a lot of cycling.

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