I’m all for working on technology that pushes the envelope and will ultimately move us forward as a society but where I have a problem is when it becomes forced rather than allowed to happen at its natural progression.
Therein lies my problem with President Obama and his band of Tree Huggers with the electric car technology.
In theory, this is great as it would reduce our dependence on oil and we could tell the folks in the Middle East to pound sand. But we are a long ways from that and yet President Obama and his band of Tree Huggers, instead of allowing research and testing to continue along a normal path, have decided since Obama entered the White House to push this technology upon the American people wayyyy before it’s ready.
The answer for Obama and his Tree Hugging Occupiers always is to just throw more of our Tax Payer dollars at it and that will cure all ills.
However, when you force something, there can be consequences that can ultimate set back a program rather than nurture its progress. And for the American consumer, public failures of a product thrown on the market before its time can set in place a negative perception that can kill a product; leave a long lasting negative perception in the minds of consumers and poison the water of public support for a potentially emerging technology.
Robert Bryce, author of the book Power Hungry: The Myths of “Green” Energy and the Real Fuels of the Future pens a solid column on this whole Obama mess in a recent National Review on-line posting:
“Electric-car sales are on fire. Okay, well, only a few electric cars have actually gone up in smoke. But with the National Highway Traffic Safety Administration opening a formal safety investigation into fears about fires started by the much-hyped Chevrolet Volt, it’s become clear yet again that electric vehicles are The Next Big Thing — and they always will be.
Safety questions are the last thing that the electric-vehicle market needs. Indeed, the U.S. already has a huge excess of electric-vehicle (EV) battery-production capacity. This month, A123 Systems, one of the country’s highest-profile battery makers for the EV market, cut 35 percent of its workers at two Michigan plants. A123 was one of several dozen companies that got subsidies from the Obama administration, which has handed out $2.4 billion in grants to the EV sector, as well as nearly $2.6 billion in loans. (More on that in a minute.) Further, despite Obama’s hopes, made clear during his State of the Union speech earlier this year — that the U.S. would be “the first country to have 1 million electric vehicles on the road” — sales of cars like the Volt, a plug-in hybrid-electric vehicle, and the all-electric Nissan Leaf, have been tepid at best.
In October, combined sales of the Volt and Leaf amounted to just 1,957 units. That means that the two vehicles captured just two-tenths of 1 percent of total U.S. light-duty vehicle sales, which totaled 1.021 million units. GM has spent hundreds of millions of dollars on the Volt, but in October, when the auto giant sold 186,895 light-duty vehicles, the Volt accounted for just 1,108 of them. Put another way, GM sold 168 times more conventional vehicles last month than it did Volts. Meanwhile, Nissan sold 849 copies of the Leaf, while its overall sales totaled 82,346.
The ongoing NHTSA investigation — which has sparked lots of coverage in the mainstream media — will almost certainly drive down EV sales over the coming months. And that’s bad news for GM, which had hoped to sell 16,000 Volts in 2011. But through October, it had sold just over 5,000 Volts, which carry a suggested retail price of $41,000.
The lackluster sales of electric vehicles should not surprise anyone. For 110 years, American consumers have been hearing that electric cars are on the verge of viability. Consider this May 19, 1901, news report from the Los Angeles Times concerning a new battery invented by Thomas Edison: “If the claims which Mr. Edison makes for his new battery be not overstated, there is not much doubt that it will make a fortune for somebody. The electric automobile will quickly and easily take precedence over all other kinds of motor carriages.”
I could easily provide another two dozen examples of news clips from papers like the New York Times and Washington Post, all of which promise that the age of electric cars lies just past the next stoplight.
By lavishing billions of dollars in stimulus money and loan guarantees on the electric-vehicle business, the Obama administration hoped to jump start the century-old automotive technology. That hasn’t happened. Instead, we’re seeing a slow-motion replay of the Solyndra debacle. Consider what’s happening at Ener1, the parent company of Indianapolis-based battery maker EnerDel, which was awarded a $118.5 million grant (tax payer money) from the Department of Energy.
Despite the subsidy, Ener1 appears to be circling the drain. In August, after it announced it would restate its financial results, the company was hit with a wave of investor lawsuits. The company’s 2010 losses of $69 million were restated to an actual loss of $165 million. Last month, the company was delisted by the NASDAQ, and several top executives have left. In January, when Joe Biden visited EnerDel’s battery plant in Indiana, Ener1’s stock was selling for $4. About the time that Biden was visiting the plant, EnerDel was claiming that its new plants would have “the capacity to produce battery packs for approximately 600,000 hybrid-electric vehicles, or 60,000 battery-electric cars.”
On Tuesday afternoon, Ener1’s stock was selling for $0.09.
Similar problems are afoot at A123, which got a $249 million DOE grant (tax payer money). The company’s stock price is down by about 75 percent since January. It slashed its Michigan work force after a big reduction in orders from one of its main customers, Fisker Automotive, the company that’s now producing a $97,000 high-performance plug-in luxury car — in Finland.
The amazing thing about the meltdowns at Ener1 and A123 — and the almost-certain failure of other battery makers — is that none of this is surprising. In July 2010, Menahem Anderman, the founder and chief executive of California-based Total Battery Consulting, told the Washington Post that, by 2014, global capacity for EV batteries would be three times greater than demand.
Sure, GM may be able to resolve the problems with the Volt. But the big hurdle, as Anderman pointed out last year, remains lackluster demand. Why would a car buyer choose a Volt, which gets 40 miles per gallon on the highway and costs $41,000, when he could get a Chevy Cruze, which is nearly identical in size, gets better mileage, and costs less than half as much?
Back in 2009, Johan de Nysschen, the president of Audi of America, cannily predicted the Volt’s future: “No one is going to pay a $15,000 premium for a car that competes with a Corolla. . . . There are not enough idiots who will buy it.”
And so it goes . . .
