Friday, July 21, 2006

What an Electric Vehicle Costs

In an earlier post I mentioned the controversy over GM's EV1 sparked by a new film, with some people arguing that the all electric vehicle was a viable design scrapped by GM for vague but sinister reasons. In my view, the best evidence against that comes not from GM's experience—the facts about the EV1's performance are disputed and it's hard for an outsider to distinguish between startup costs and production costs in order to figure out what a commercial version of the car would have cost—but from the behavior of other auto firms. If a commercially viable electric car could have been produced, it is hard to see why some auto firm wouldn't have produced it—and none did.

We now have a little more evidence. Tesla Motors, a Bay Area startup, has announced that they will be bringing a fully electric vehicle to market in about a year. The relevant facts:

1. Range: 250 miles per charge.
2. Recharge time: 3 1/2 hours with a 240 volt/70 ampere source, longer with ordinary house current.
3. Configuration: Sports car.
4. Price: $85,000-$100,000.
5. Operating cost: 2.6 cents/mile if electricity is 13 cents/kwh.

If gas costs $3/gallon, the per mile cost for a vehicle averaging 25 mpg is 12 cents, so the electric vehicle saves less than ten cents per mile. If we assume a 100,000 mile lifetime, that's less than ten thousand dollars, which doesn't make up for much of the cost difference between the electric car and a conventional vehicle.

The range is sufficient for many people's needs, although not all. But a sports car does not have to carry many passengers or much luggage, leaving more space for batteries. That suggests that a sedan would either be much heavier and more expensive or have a substantially shorter range.

So the evidence suggests that the electric car is not yet viable as a mass market vehicle, although it may be competitive in the expensive sports car niche.

Readers interested in the EV1 controversy may want to revisit the thread I linked to earlier, with particular attention to the posts by Phil Karn, who joined the discussion after my original post. Phil—known to some of us as a party in an important encryption lawsuit—actually owned an EV1, and so was able to provide some first hand evidence from his own experience. He also has an interesting web page on the subject.

17 Comments:

At 10:08 AM, July 22, 2006, Blogger James Leroy Wilson said...

Still, I hope that rich people buy it. The more the rich encourage this, the more practical and less expensive those cars will be.

 
At 12:09 PM, July 22, 2006, Blogger Marco said...

This comment has been removed by a blog administrator.

 
At 3:39 PM, July 22, 2006, Blogger Rick and Gary said...

Another cost factor is battery replacement -- how long do the OEM's last and how much is is to replace them.

That's also a hidden cost factor in ordinary-guy hybrids. My guess is that the batteries in this sports car last a lot less then the hybrid's 100,000 miles and cost tons more to replace.

 
At 11:22 AM, July 24, 2006, Anonymous Wild Pegasus said...

How toxic are the batteries once they are depleted? Both lead and acid are extremely toxic and must be disposed of in special, expensive ways to keep from poisoning the ground.

If brand new facilities must be built for processing dead batteries for disposal, there are no energy savings.

- Josh

 
At 2:31 PM, July 24, 2006, Blogger markm said...

Lead-acid batteries are recycled back into lead plates and sulfuric acid for new batteries. Although I'm not knowledgeable about the processes involved, the bit of chemistry I do know seems to indicate that turning lead sulfate back into lead and sulfuric acid shouldn't be too difficult. Too much demand and both battery production plants and recycling plants will have to be expanded. Of course, first they have to be collected, stored, and shipped to the recyclers safely. The old dead ones are no more hazardous than the brand new ones being shipped the other way, but it's easier to persuade people to safeguard new product than waste.

Most other kinds of batteries are more or less hazardous, too. A battery has to include at least one highly reactive substance, so a punctured battery of almost any possible chemistry will leak something (a strong acid or base, etc.) that will burn your skin and ruin anything it touches. But the biggest hazard is heavy metals such as lead or cadmium (in NiCads), that will still be around after the acids or whatever have been neutralized and diluted to harmlessness. I think the NiMH and Lithium chemistries have eliminated that hazard - but in electric-car sizes, they're too expensive as of yet.

Then there was the proposal I once saw for a battery where the liquid was molten Sodium. There's no lasting poisonous residue, but have an accident, spill a molten metal that catches fire when exposed to air even at room temperature, burns underwater, and when the "ashes" are mixed with water it produces boiling hot sodium hydroxide...

 
At 2:17 AM, July 28, 2006, Blogger Andrew said...

$85-100k for a car with this sort of acceleration is not bad. The performance profile is probably similar to the Lotus Elise (a $50K car that uses a relatively inexpensive toyota engine), though it's much heavier due to batteries.

Batteries are really the factor limiting where electric cars can go. There is a severe tradeoff between cost, capacity, and weight. The Tesla car is viable. I have no doubt that it will sell out quickly. More conventional electric cars will succeed if consumers are ready to accept small ranges and if battery technology improves (and of course, oil prices stay high).

I personally think it's very impressive for a first-generation car. People often make comparisons between different technologies in their current state which quickly become invalid in the future because different technologies advance at different rates. The hybrid engine technology gets remarkably better every few years, while gas engines haven't changed much in a decade.

The best feature of electric motors is the high torque, which allows for great acceleration. I've always found it unusual that hybrids started on economy cars, where the benefit is relatively small, as opposed to large cars, especially SUVs, which would benefit greatly from hybrid technology. A 40% increase in mileage is much more significant on an SUV than a civic.

Rick wrote:Another cost factor is battery replacement


For hybrids, this isn't a big deal. Battery capacity in the hybrid is a much less important factor than in pure electric cars; in a Prius drivers should notice virtually zero difference even if the batteries are at half capacity. Mileage may be worse, though.

markm wrote:I think the NiMH and Lithium chemistries have eliminated that hazard - but in electric-car sizes, they're too expensive as of yet.

Hybrids are definitely using NiMH these days.

Wild Pegasus wrote:If brand new facilities must be built for processing dead batteries for disposal, there are no energy savings.


That's quite erroneous, much like saying that any positive number added to any negative number is zero.

 
At 11:21 PM, August 01, 2006, Blogger Amit said...

The range isn't the big problem for me. It's the lack of quick recharging. Most of the time, a range of 250 miles is fine. Once or twice a month though, I take a longer drive (400+ miles). The Tesla doesn't work for trips like this. I can quickly refuel a gasoline or diesel powered car, but I can't recharge the electric car.

That means I either need to own two cars or I need to rent a car often. The increased cost of having the electric car is higher than just the purchase price.

 
At 4:05 PM, August 03, 2006, Anonymous dismal said...

Andrew said: I've always found it unusual that hybrids started on economy cars, where the benefit is relatively small, as opposed to large cars, especially SUVs, which would benefit greatly from hybrid technology. A 40% increase in mileage is much more significant on an SUV than a civic.

Economics have nothing to do with it, I'd guess. People who understand and care about all-in operating costs don't by hybrids.

It's marketing. The segment that is willing to pay extra for a hybrid isn't going to buy an SUV.

 
At 10:14 PM, August 03, 2006, Anonymous Anonymous said...

The TRUE cost of an electrical vehicle is that after D-Friedman posts about it, he doesn't post for another two weeks.
errr.arrgghh..brain needs stimulation...
Alcibiades

 
At 8:09 PM, August 09, 2006, Anonymous Gary Anderson said...

I heard that Altair Nanotechnology has developed a battery that is better because it doesn't use nickel.

 
At 10:41 PM, August 11, 2006, Anonymous Anonymous said...

Hey, David!

I check your site every day and you've not posted for almost a month.

Do you think we pay you to just sit around and...

Oh, wait...never mind...

:->

(But we WOULD love to have more of your thoughts online...)

 
At 4:37 PM, August 13, 2006, Blogger Rick and Gary said...

Anonymous said: I check your site every day and you've not posted for almost a month.

Anonymous, you may want to use an RSS feed on Google Reader. That way, you'll know when there's a new posting without checking the site all the time.

 
At 10:03 PM, August 21, 2006, Blogger David Friedman said...

There are two reasons I haven't put up anything new for the past month:

1. I've been travelling, with irregular net access--but am now back home.

2. Blogger won't let me.

Somehow, Blogger's web software has decided that my blog is on my ISP's server, when it's actually on blogspot. The result is that all attempts to publish new posts produce error messages. I have reported this to Blogger help and been told via a computer generated message that everyone is too busy with the new beta to deal with such problems.

 
At 1:07 PM, August 22, 2006, Blogger Andrew said...

Update: The first 100 Tesla Cars were sold in three weeks.

Once production ramps up, the company is hoping to sell 2000 cars a year ($200M), which would put them past well-established sports car brands like Lamborghini.

 
At 4:38 PM, September 06, 2006, Anonymous Anonymous said...

Perhaps a better comparison for cost saving is to use the price of petrol (gas) in the UK where the price is close to $8 per gallon. And I have watched news reports of people in the US vehemently protesting about gas prices on your side of the Atlantic.

That would make a vast difference to the cost saving efficiency.

With the Middle East in turmoil, there may be more savings to be had than originally thought. I try to give an insight into the history of accounting which covers the emergence of Western economies.

 
At 10:39 AM, May 06, 2008, Anonymous Anonymous said...

Just an observation... The Tesla Roadster 0-60mph test clocks it at under 4 seconds; therfore, it is a racing caliber vehicle.

The cheapest, production, gas powered, racing caliber vehicle that compares (even in fit and finish)is the Lotus Exige. It is priced between $61k to $64k, so the $85-$100K price tag for the Roadster really isn't that bad.

I am terrible at math, so I won't even attempt the analysis between the two; but, at first glance, I think those prices being factored into the equation would tip the total cost of ownership (TOC) scale in favor of the Roadster considerably. Of course the TOC does depend on maintenance and replacement parts costs as well.

 
At 7:41 AM, May 28, 2013, Anonymous alke said...

Unfortunately electric cars still cost too much

 

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