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Tipping Point To Mass Scale Adoption Of Electric Vehicles

Published Tuesday, April 24, 2012 by Ryan Allway
Mass adoption of Electric vehicles might only be a few years away. The key to adoption of electric vehicles is the acquisition cost, infrastructure and range of the vehicles. Current range of most Electric Vehicles (EV’s) in the market is equivalent to having a 2 gallon fuel tank. Although most of us do not use 2 gallon of gasoline in our everyday commute, we would all have a range anxiety if our cars had only 2 gallon fuel tanks. We would immediately demand gas stations are built near our workplace, shopping centers, airports and homes, before we purchased an automobile.

Similar is the case of range anxiety with electric vehicles. Lot of consumers, are not aware that we are only one generation of battery chemistry away from a six (6) gallon fuel tank equivalent. The next generation battery will also solve the infrastructure issues related to electric power grid. Imagine a 6 gallon tank equivalent EV, which would be equivalent to 250 mile range on a single charge, sufficient for EV users to come home charge their vehicles during off-peak hours. This would require much smaller home chargers that do not need upgrade of home infrastructure, and does not impact electric grid during peak hours. Similarly, businesses will be able to adopt EV’s for distribution applications, charging their trucks, vans or other vehicles at their business facility during the night.

Mass adoption of this next generation of electric vehicles will result in investment capital moving away from innovation phase of EV’s (and batteries) to integration phase of EV’s. Flow of capital investment will increase towards construction of new manufacturing plants, hard tooling of components and assembly automation resulting in cost reduction of EV’s below gasoline vehicles.

This scenario of rapid transition (within 10 years) to EV’s has been proven before in the industry. Let us take for example the golf cart industry that started in 1954 where all golf carts introduced were electric powered. In 1970’s golf cart industry transitioned from electric golf carts to gasoline powered golf carts due to lack of control and charger technologies. It was in early 1990’s where solid state controllers and automatic chargers were introduced, leading to rapid reversal of the industry from gasoline powered golf carts to electric golf carts. Today, it is very rare to find a gasoline golf cart globally, resulting in over 90% of the golf cart market controlled by electric models. Today, not only electric golf carts control majority of the market, but also electric golf carts are 25% lower in price than its gasoline competitors.

Similar stories can be found in forklift, ground support airport equipment and industrial equipment industries. One thing common in all these industries was that the transition to electric technologies was very rapid (within 10 years), once the relevant technological issues were resolved. Another thing common in these transitions was that the price of electric vehicle was always lower than the fossil fuel powered vehicles once some scale was established.


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