Electric Car Breakthrough Will Be Driven By Thrilling Models.
“All manufacturers have invested heavily and people will be surprised at the quality. Towards the end of this year and through 2019, starting at the Frankfurt Car Show, we are going to see the results”
Electric cars are about to be transformed into must-have, desirable and practical vehicles from their current status as fringe, expensive, fashion items only likely to attract mass market interest after government bribes and regulation.
This transformation will take place over the next couple of years because of huge investments by the world’s biggest auto manufacturers.
That’s the view of Pasquale Romano, chief executive of ChargePoint Inc of Campbell, California, and hardly surprising given that the company claims to be the world’s largest electric vehicle charging network.
This explosion in the popularity of electric cars has been long promised, but demand has been crippled by relatively high prices, worries about price depreciation, doubts about range reliability, and a lack of charging stations.
Demand in the U.S. and Europe still languishes at around 1% of the market. Electric car sales forecasts are very impressive though. Morgan Stanley expects global battery electric vehicle sales of between 10 and 15% by 2025. Volkswagen expects this to hit 25%. But it wasn’t that long ago that the Renault Nissan Alliance, pioneer of electric cars for the masses with their Zoe and Leaf models, was predicting 10% global sales by 2020. That forecast has clearly crashed and burned.
Off to the races
But Romano is confident that when the auto manufacturers reveal their latest electric products, sales will be off to the races.
“All manufacturers have invested pretty heavily and people will be surprised at the quality offered in these cars. Towards the end of this year and through 2019, starting at the Frankfurt Car Show, we are going to see the results,” Romano said in a telephone interview.
The Frankfurt Car Show takes place in mid-September.
Electric cars expected on the market before 2020 include the Porsche Mission E, Tesla Model 3 and Y, Audi e-tron, Jaguar i-Pace, Mercedes EQ, a Volvo, VW ID, Ford CUV, and an improved version of the Leaf.
Romano said electric cars will be able to attract buyers not only because of their all-round abilities but also the need to clean up city environments. The burgeoning diesel health scandal will also help in Europe.
“Electric vehicle sales are accelerating and getting close to mass adoption. There is a level of government mandates but we see in the U.S. that once behind the wheel, drivers quickly find this a better way to drive, they are more reliable and cost less to run,” Romano said.
Why would anyone in the U.S. want an electric car with gasoline so cheap?
“It’s the same reason. It is a better vehicle experience. If you look at Tesla and the Chevrolet Bolt, they are fun to drive and perform well. Once you’ve bought one they cost less to run. It’s a better experience and they are very good for the environment,” he said.
Tesla twice the Bolt price
The little Chevrolet Bolt costs around $38,000, and the cheapest Tesla is upwards of twice that, before government subsidies. The Leaf costs a bit less than the Bolt, but has much less range than the claimed 238 miles.
ChargePoint has more than 36,000 charging points at more than 7,000 sites in North America. It is currently mounting an initial assault on European markets and has just concluded a $43 million financing, bringing the current round to $125 million. BMW, Mercedes-Benz parent Daimler and technology leader Siemens have contributed to funding.
“Car manufacturers are taking this very seriously and I expect them to be very competitive. Tesla obviously is a competitor and will be a long term player; it’s no flash in the pan,” he said.
Romano said its market share in North America is about 70%, and it is expanding in the U.K., Germany and the Netherlands initially.
“Obviously we want to be market leader in Europe but we have to earn that. Other players will have similar aspirations.”
The diesel crisis in Europe provides a big opportunity for electric cars. Because of government subsidies to promote diesel, market share in Europe has been huge. Every other car bought in Europe was diesel until very recently, when worries about the health impact of diesel emissions have put the skids under sales. Ironically the diesel incentives were introduced to save the planet by cutting CO2 emissions. As diesel sales slide, car makers need to find replacements able to meet Europe’s tightening and swingeing fuel economy rules.
Meanwhile governments are removing diesel car and fuel incentives and introducing driving bans in cities including Paris, London, Munich and Stuttgart.
“The diesel problem is a big opportunity but there is no way to clean up the environment without electric power. This is the end of the line for fossil fuels,” Romano said.
When ChargePoint be profitable?
“The U.S. operation is mature and we will be making money next year. Europe is just getting off the ground and hard to predict. But we don’t see the need to raise any more capital,” he said.