PHILADELPHIA Eighteen months ago, entrepreneur Norman P. Zarwin opened an electric-vehicle charging kiosk at a gas station he owns. If he built it, he figured, electric vehicles would come.
“There’s not a lot of use on it because there’s not a lot of vehicles,” Zarwin said.
Despite the enthusiasm for electric vehicles, the marketplace has not exactly caught on fire.
News reports have tended to focus on the negatives. General Motors did not meet its 2011 sales targets for Chevy Volts and shut down its production line for five weeks to work off surplus inventory. Nissan, after selling 1,708 Leaf sedans last June, has experienced a sales decline – it sold just 370 of the all-electric vehicles in April, down from 579 units in March and 478 in February.
The reasons for the tepid sales are well-known. Even with a $7,500 federal tax credit, the vehicles are expensive – about $40,000 – and have a limited range. Outside the home, where 80 percent of EV owners charge their cars, there are few public places to recharge.
But electric vehicle advocates say they are still bullish on the future. Though Nissan has sold only about 12,000 Leafs since the vehicle was launched in 2010, the Japanese automaker this year will open a plant in Smyrna, Tenn., capable of producing 150,000 cars a year, along with 200,000 lithium-ion battery packs.
“This is something that Nissan as a manufacturer is all in on,” Tracy Woodard, director of government affairs for Nissan North America Inc., told a Pennsylvania Public Utility Commission forum at Drexel University last week.
To promote electric vehicle technology in Charlotte, owners can still get a free re-charge at city-owned charging stations that opened in April. The city installed 26 charging plug-ins at seven sites in and around uptown and at park and ride stations elsewhere in the community.
If electric vehicles are to make it in the mass market, rather than as a city vehicle for the rich, experts say, the industry needs to reduce its cost, which is largely driven up by the lithium-ion batteries each car requires.
The batteries have a short life and need to be replaced, so the value of the EVs depreciates quickly and reduces the potential resale market. The batteries also decrease quickly in value because the technology and capacity are improving with each generation.
“Lousy resale value means goodbye to the mainstream market,” said Ron Adner, professor of strategy at Dartmouth University’s Tuck School of Business, who devoted a chapter to electric vehicles in his recent book, “The Wide Lens: A New Strategy for Innovation.”
But just solving the battery issue will not cure the electric vehicle market. If EV sales suddenly take off, experts say, conventional electric distribution systems could be quickly overloaded with vehicle owners plugging their cars into the grid, overloading wires and transformers.