Make Like a Tree and Leave?

Car-maker Nissan-Renault revealed its first all-electric car last week – the LEAF – due on our highways next year. Although half a million hybrids are sold worldwide each year, and high-end all-electric vehicles are now available, the LEAF will be the world’s first mass-produced, globally marketed, highway-proficient electric vehicle (EV). Nissan is trying to distinguish itself in an increasingly crowded parking lot to steal a move on Toyota, which has recently sped into the No.1 global auto-maker position, thanks to its Prius halo. Is the hybrid just a predecessor? It seems motor manufacturers think so; many believe the EV could be the next big thing and are betting big on it too.

So what’s so significant about this launch? Well, for me it will mean that, if the car is charged by renewable energy, which is becoming more abundant, driving the car will mean zero emissions and guilt-free motoring. In addition, the driver will not be subject to the vagaries of oil price volatility – remember $4 gallon gas? You won’t have to worry about this when the economy ambles out of recess. The price to top-up a battery will be equivalent to 75 cents per gallon of gasoline. And prices for renewable electricity will only get cheaper compared to oil and gas as more power plants, more efficient technology, carbon pricing and investments in transmission all come on stream. Insurance and tax for an EV is lower too, with a $7,500 rebate from the government for buying an electric car. And, families will have the pleasure of knowing that they’re not contributing to climate change, leaving the planet in a better state for their offspring and grandkids.

There are some serious questions to be asked of this disruptive industry, however. How the electric vehicle will overcome some of the technical drawbacks, and usurp the internal combustion engine’s dominance, remains to be seen. Recharging speeds will surely get faster but even if they don’t, infrastructure provider Better Place is planning a battery-swap network too. We’ll see what business model prevails but with Nissan planning to sell its car without a battery, the door is open for companies like Better Place to climb in and lease batteries and power through ‘electric miles’ packages, similar to the way you get a subsidized phone with minutes through your cell phone provider.

Is there an existing demand for electric vehicles? Many asked this same question before the Prius hybrid launched and went on to become one of Toyota’s best-sellers. Maybe we could use its rise to prominence as a proxy for the EV?

And how will the U.S. economy benefit from the EV? With U.S. automakers on their knees, the government believes that ‘Car 2.0’ is the best way to rejuvenate the industry, and has provided billions in stimulus funds, backing the development of battery-makers.

What’s more, is there enough infrastructure to support the EV? With start-ups like Better Place and Coulomb Technologies engineering the infrastructure for a recharging network, power suppliers increasing their renewable energy investments and independent providers, like solar-innovator Stirling Energy, stepping up to harness the sun’s rays, it seems the electric-car superhighway is currently well under construction.

So, with all the supply-side issues covered, will there be a tipping point for electric cars? As much as environmentalists would like everyone to bike or take public transport, the nation’s love affair with the automobile, with all its flexibility and versatility, will never end. Consumers are increasingly rewarding brands that do good, basing their purchases on practical benefits such as convenient transportation and lower running costs, social benefits like emissions reductions and the tribal benefits of belonging to this new ‘club’ of informed drivers. With this trend, and the promise of cleaner cars on the streets, our motoring freedom and the planet’s survival look set to cruise together in electric dreams.