This week we welcome Peter Hofbauer, a former diesel-engine designer at Volkswagen who’s now the Founder, Chairman and Chief Technical Officer of EcoMotors, the company that’s developing a revolutionary opposed-piston engine.  We’ll be talking all about the future of the ICE and what his company’s new powerplant can offer the auto industry as it shoots to deliver better fuel economy.  As usual, we’ll also get to the news of the week like how GM’s getting ready to start mass producing batteries for the Chevy Volt.  John McElroy’s in studio with Peter De Lorenzo, the Autoextremist, and David Welch from Bloomberg BusinessWeek.

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The seventh-generation Chevy Malibu is a popular little mid-sized sedan and is sent from this spot to the far reaches of where buyers will settle for buying them. This is what happens when an undelivered Malibu confronts a train.

The details of the accident on the police report state that the employee dropped the manifest and was in an area near the tracks that is unlit and that the flat bed train car was difficult to see late in the fading sun.

Malibu Meets Train

Rumors present a different story. The employee went to run an errand (allegedly to the Qwik-Trip Mart and had asked fellow workers if they needed anything) in the fresh-off-the-line Malibu and was driving without a seatbelt at about 35mph towards a railway crossing where the train was paused, red signals flashing, and was distracted by text messaging. The train began backing up just after the hit and spun the car and driver out from underneath.

“How was your day at work, Honey?”

Crunch

It is interesting to note that the airbags deployed, the worker was not injured, the windshield did not crack and the back doors are fine. Not bad for a 35mph head-on crash. There is still a lot of good car left there but it is being totalled and all of it will be scrapped.

All in a day’s work.

I have started so many blogs about GM that my drafts folder in WordPress is a virtual diary of issues that screamed to me that I needed to say something to you but then I would worry about your health. It is personal to me. It’s like telling a close elder relative that they offend everyone at Thanksgiving dinner with their un-Big Fish-Like stories and are clueless to this and something should be done but then Thanksgiving passes and so I kind of hope/think that your spouse must be telling you why people pick on you.

But here are some observations.

Whether or not you actually pay eBay for the recent trial endeavor of listing your new inventory on eBay Motors that is now coming to an end, I know this:

• - eBay Motors doesn’t care if you pay them. The free marketing you did for the most cheap and marketing incompetent major company in the world realizes that it was your money who brought them all of those wonderful hits. They base stock price on hits. No sales for you but hits for them.
• - While we are on your money? It was nice of you to pull eBay Motors along with you while you paid back part of your loan … that wasn’t your money at the time nor was the contract with eBay even signed when the program was announced. I like team spirit among people. Sharing is nice.
• - You did a nice thing for your franchisees by putting their inventory on eBay Motors on their behalf so they didn’t have to pay a marketplace they had all abandoned long ago because it was useless to them and didn’t increase sales. I bet after they had so many peers lose their franchises it made them feel warm and part of the GM family to know you could offer them a snowcone treat on a freezing day.
• - Fritz Henderson had a genius idea with this eBay Motors thing and announced it as if it was All New! although it had already been 2 years in the works and, in the panic of securing government funds, grasped it as an example of how GM was changing and showing appreciation of being allowed to continue breathing.
• - Playing with eBay Motors and pretending like cars were really going to sell was optimistic. Audi only sold 2 cars in their entire history of listing their Certified Pre-Owned cars on eBay on behalf of their dealers but you decided that GM would be different. Despite public opinion and franchisees well known for their lack of follow through on internet leads, you were going to sell cars, dang it!
• - Everyone knew that this eBay program was about generating leads and you say that you got 15,000 leads on 16,000 cars in 225 California dealerships which is great but you claim you don’t have visibility on how many of those ended in successful sales. You could (dealerships and eBay are run by this thing called software) but then the cars that were listed as current inventory on eBay were very often no longer available. So maybe you got some buyers in other cars. Who knows? You could tell us but you don’t, you silly little tease!
• - Speaking of releasing actual numbers: it is cool that most of the cars you listed on eBay were higher than the prices of the actual cars on the actual lots (which is higher than people actually negotiate) because that helps the perception that we all crave in this economy (e.g., cars are worth more than they are if you see it on the internet).

We don’t have to talk about the money back guarantees and how that worked out for other companies before or how playing conkers with the media is proven to be a bad idea. I do want you to start talking though. This Penske deal is a huge heartbreak for a lot of people. I am keeping my fingers crossed for Hummer. This isn’t pretend anymore. People have used you and you show a kind face of being optimistic and take the knocks of being the one at fault. Managing bad news is not a fun job and a lot of very tired but loving employees working on your behalf. Bad news is not a PR opportunity. It is a sign that everyone is tired. It is time to start making some good news.

The Old Gray Mare Ain’t Worth What She Used To Be

Last year GM was able to trim down a quarter of its workforce- about 19,000 hourly workers in all. But the employees who decided to bail before the bailout were offered a lot more money than the employees being asked to leave now. How much more? About $120,000 each! That is right- before the slide became the avalanche on the car lots last summer, GM was offering employees $140,000 each to voluntarily leave the company. Given that they also had to forgo health and insurance benefits when they left, it really isn’t that much of an offer in the scheme of things. The employees who were either not offered the buyout or turned it down now are going to be offered a buyout package at a deep discount of $20,000 to leave and a $25,000 voucher for a ….what else……a free car.

But The Wagon Maintained Its Value?

With photos coming out recently of excessively unsold inventories of cars piling up around the world it seems that the value of unsold cars would be plummeting but they aren’t. Yet. Imagine what happens when all of these employees who take the buyouts end up with cars they don’t need but have payments due for things that they do need, like housing. The cars will potentially end up on the market and at deeply discounted prices because the employees are now deeply discounted in their employment value. Call it a Former Employee Discount. And the dealers will not make a dime from these transactions because these cars will be sold on Craigslist.

Back On The Farm

Recent ‘temporary layoffs” have hit all of the Big 3’s plants and most do not seem to have an end in site. Usually the plants shut down for 2 weeks around the Christmas holidays but this year the holiday period is extending into mid-February at the very earliest for even some of the most successful plants, including GM’s Fairfax plant in the Kansas City area. Fairfax employees have been producing two of GM’s biggest successes: the Chevy Malibu and the Saturn Aura. Currently between employee compensations from GM (negotiated by UAW 31) and unemployment benefits the workers are drawing about 90% of their normal wages but the state has been slow in paying because of the sheer volume of sudden claims coming their way. Any suggested or the inevitable forced buyout will further strain the state which has until recently maintained better than average unemployment.

(I am curious if GM ever received a $146,000,000 bond initiative that was being presented if they would make a mid-sized car at the Fairfax plant because I am pretty sure that mid-size is the new Buick LaCrosse that was already in pre-production at the plant when they sent all of the workers home for their long winter nap.)

“Forced buyouts”, you ask? If employees don’t accept the package to leave then they probably will be given a ticket to ride. And that may not include a free car.

I heard a story last month about a GM employee who had worked in the marketing department for over 15 years but still made less than the people who worked on the lines for less than 10 years. When this marketing guy left he went to another company with a nice parting bonus from GM and a $75,000 increase in pay at the next company. His value went up while the workers on the line he used to resent are being devalued every day.

Oh boy. We should probably all be very grateful that is not the case.

The contemporary electric car is such a lovely romantic idea and I am not one to knock the dreamers but at the rate that the independent electric car makers are going we better keep our bicycles tuned up for quite a while.

Tesla has been a PR machine. Until recently. Delayed production has led to rumors and snafus abound. Imagine being the buyer of a Tesla Roadster. You have made a $50,000 deposit two years ago and you haven’t received your car. You hear through the grapevine that employees found out about a layoff through a blog written by the CEO to the general public. Not you, the early adopter. And then, just to make your day, you get a letter from Tesla telling you that when your car is eventually delivered you will have to pay more than you originally had agreed to paying. Even the proprietary charger that was included in the base price is now going to cost you extra. Its like buying a battery operated toy and getting home only to find out that batteries were not included even though the salesman told you they were. AND you are paying more than the $100K you signed for. {“Honey? Don’t buy the organic wine for a couple of months!”]

If that is the case then you have arrived as most of the country cannot fathom (but fantasizes) about being so “lucky”.

Aptera (yeh, I will be cliche here and say “that Jetson looking EV”) is having its own bumps. Recently they were all ready to go into production having built a 70,000+ sq. ft. facility a third of the way between LA and San Diego and no man’s land and hire on a full team for their Robin Reliant by Dr. Who vision of the EV.  Candidates were aplenty but, you know, sorry, the project is on hold for a *few* months now. They are looking for additional funding now and won’t be hiring in the near future.

What about ZAP (which is such an adorbs car that I almost forgive them) and years of false promises and bad press?

The independent gas to electric conversion companies are still around, struggling, asking for capital (remember when we used to call it money?) but are still at least a year from fully operational and that is with conditions and a $20K plus price tag to convert your car of choice.

Fact is, this is not Tucker the Movie. It isn’t even Lee Iacoccoa’s world. For years- and I mean YEARS- the venture capital world has funded and lost its love of the EV. Many a CEO has probably told their families that the dot com they walked away from which gave them a nice life would be so much better if they gambled their equity (SLASH fortune) into something green, something progressive, something that will mean something to the kids. Oh, the justification of the green. Dollars, I mean.

So now the EV independents are jumping on the bail-out bandwagon. They’re asking the government to help them when for the last several years their venture capital seeking expeditions has forced them to suffer in Aspen, San Francisco, London, Paris, Miami and other low rent districts. It has been so hard for them.

So what about GM and the myths about these PR machines? GM is a PR machine too and talks a lot of talk and has yet to prove anything EV but they are working (and I mean hard) to meet this. But why? Because of demand. Irony is that everyone loves the idea that their dollars count and for years and years Normal Joe’s have “voted” for high consumption guzzlers while their [INSERT FRIEND/RELATIVE HERE] was getting paid (and paid WELL with health care) for making the cars that they demanded.

Not that anyone really cares. It is fun to place blame. And, oh, that Joe? He is mad now. And his kids don’t have healthcare because he didn’t want to be that guy on the line.

… but everyone has an opinion despite the fact that if everyone complaining actually owned their past demands then they would realize the the fault does not lie in the car companies and that despite of the fact that you can’t wander without tripping over yet another EV company, the alt.fuel deficit all belongs to every one of us.

And yeh. I am back.

XOO,M

This blog was written 1 1/2 years ago by a good friend who an industry expert & veteran of the automotive industry. Steve loves all things cars and has taught me an unmeasurable amount about the industry. I wish that he would write more often but for now I wanted to share this insightful review of the movie, Who Killed The Electric Car.

I wasn’t able to see this movie in the brief time it was in theaters, but I was able to rent the DVD this weekend soon after the video was released. Since I knew Chelsea Sexton well while she worked on the EV1 program at Saturn and was involved in this program perhaps longer than anyone else on the sales and service side at Saturn I was pretty disappointed in the movie.

While I understand (and share) the enthusiasm for electric cars shown by Chelsea and the rest of the cast and crew of the movie, I think they lost a great deal of credibility by not providing a more balanced view of the issues at hand.

Additionally, the movie glossed over the facts that other manufacturers (including Honda, Toyota, Nissan, and Ford) had EVs available in California in the late 1990s, but really portrayed General Motors as the evil-doer among the manufactures. The fact is that GM made the largest effort by far of any of the manufacturers on EVs yet they get no credit at all for the effort. The movie just blames them for the end result of there being no OEM produced EVs for sale in the state.

Here are some facts that were glossed over by the movie makers:

1- GM spent over $1.5 Billion producing and marketing the EV1. With very few exceptions, the consumer marketing was limited to California and Arizona where the cars were available to lease. So, asking someone in Kansas or who didn’t live in California between 1996 and 2000 if they were aware of the car is nothing more than a cheap stunt.

Yes, some of the ads portrayed in the film were a bit “dark” and I agree that some of the ads were pretty esoteric, but these were not used very much. The majority of the ads included billboards with a clear photo of the unique shape of the car with the statement “The Electric Car is Here.” Newspaper ads also had a much more upbeat image and the PR efforts, the press coverage, the hands-on marketing efforts (in which Chelsea participated) put the cars in the hands of thousands of Californians and Arizonians for test drives during the time it was available.

Do the math: best case, GM was geared up to manufacture 600 or so EV1s per year. If the goal was to sell these cars, the best way to spend the money was to go directly to potential buyers, not to use expensive mass media. GM did both.

2- The state of California was talking out of both sides of their mouths with the mandate.

I was there in Sacramento. On two occasions, bills to open the HOV lanes to EVs with one driver were vetoed by then Gov. Pete Wilson. This law was later passed and now helps thousands of hybrid drivers enjoy these usually empty lanes during rush-hour traffic. This same incentive would have been essentially free to the state to provide to EV buyers during the critical period of the vehicles’ birth. It was never passed until years later.

The state promised the manufacturers that they would support the sales under the mandate by purchasing or leasing EVs for use in state fleets. As far as I know, they only leased 8 EV1s and a few dozen S10 electric trucks… Not the hundreds they had promised. Even the state that imposed the mandate wouldn’t lease the cars. They argued that they were too flashy for use by their employees.

When the first batch of EV1s were leased in late 1996, the California DMV dragged their heels for months before they issued license plates. They claimed that the cars couldn’t be registered because they did not pass the state’s tailpipe emissions test. Battery powered electric vehicles like the EV1 don’t have tailpipes and they produce no on-board emissions. This resulted in the dealers needing to issue and reissue temporary paper tags to the leasees of the cars. So you had one arm of the state mandating the sale of the cars (as early as 1990) but the other not able to provide them with license plates nearly seven years later.

And then there was the issue of public charging. People who drove these cars realize that the vast majority of the charging took place in the owner’s homes and garages but that public charging was a way of assuring the public that they could charge them while out and about if needed. I was at meetings of the CARB and the CA Energy Commission where the bureaucrats said “GM is going to make all the money selling these cars, they should pay for public charging.” First, the horizon for profit on EVs was many years away and let’s remind the state that they were the ones with the mandate for hundreds of thousands of these things on the road in a very short amount of time. Anyway, GM ended up floating the bill for the vast majority of the public chargers in California and Arizona. I think that around 1999 there were 500 such sites available to drivers in California. Additionally, partnerships with other companies like Costco, the Sacramento Municipal Utilities District, Southern CA Edison, Fry’s Electronics, and others I can’t remember now, resulted in a lot of the visible chargers. In fact, most Fry’s and Costcos in the state set aside prime parking spots and split the bill to install publicly accessible and free 220v inductive and conductive chargers. This made sense, it could take a couple of hours to charge a NiMH EV1 so it made sense to have chargers in places you would want to spend time… or might be anyway. Other chargers were visible at LAX, the Sacramento airport, some parking structures in key areas, etc. But the state had little or nothing to do with most of these. In fact, they often stood in the way because regulations around permits and handicapped parking requirements made many of these installations much more painful than need be.

3- The CA Mandate in itself was part of the problem.

Now, this is greatly based on my opinion, but I base this on facts. GM demonstrated the Impact EV prototype and announced that they would pursue a consumer version before the state created their mandate. In fact, the movie even supports this and shows how the Impact emboldened the CARB regulators to create the mandate.

However, the mandate was so vague, so wrongheaded, and so impossible to meet (in my opinion) that GM and the other manufacturers were forced to both fight the mandate and market the cars at the same time… as portrayed in the movie. This wasn’t a grand conspiracy but rather a simple question of them being backed into a corner.

I don’t know if GM would have pursued the EV1 with the same gusto if the mandate hadn’t been in place but they also could have moved more carefully and the market could have responded in a natural time if it hadn’t been there. They may still be selling the cars if the mandate had been more reasonable. I believe that it wasn’t the death of the mandate that was the last nail in the coffin of the EV1 but rather the mandate itself that set this course in motion.

The other problem not mentioned at all by the movie is that during this time, several Northeastern states including New York and Massachusetts decided to copy CARB’s emissions rules for internal combustion engined cars. They did not omit the EV mandate from these rules. In other words, the mandate effected not just sales in California but also in the cold climates of these other states. The fact is that EVs, at least in the forms available in the late 1990s, would be barely usable in Northeastern winter conditions. Freezing temperatures would reduce the 60-80 mile range of a lead-acid EV1 to a fraction of this distance, perhaps by as much as 60-80%. NiMH batteries weren’t that much better in sub-freezing temperatures as far as I know and they had a lot of other problems in hot and humid temperatures (like summers in Massachusetts).

Anyone who has tried to crank their frozen car over on a cold morning in Detroit knows all too well that chemical batteries lose energy in the cold. It’s one thing to have to crank your car over… it’s another to entirely rely on the batteries to get you to work. The other thing is that EVs lack an internal combustion engine… the source of the heat that warms the passenger compartment on cold days. The EV1 used a tiny heat pump for heating and cooling… this is fine in mild climates like Los Angeles but useless for heat if the ambient temperature is below 45 degrees or so. The S10-electric used a small gas-fired heater for cabin heat… but this wouldn’t allow the EV1 to meet the mandate in this form would it? So, killing the mandate in California would also kill it in MA and NY and neither of these states was willing to back down on their own.

In other words, the regulators knew little of the science and consequences they were forcing.

The other issue was that the mandate had things all backwards. It forced the manufacturers to sell x% of their cars as electrics but did nothing to push adoption of the products or create a market. Tax breaks for leasing or buying EVs were complex to get and not very big (the movie capitulates on this point). Other incentives like simple HOV lane access were unavailable. EV leasees had to install a 220v charger in their home in order to use the car but the state and cities did nothing to ease the permitting process or the cost on these users. It could cost thousands just to install the charger and comply with city requirements. In fact, I recall that Southern California Edison worked tirelessly to help the Saturn EV specialists negotiate this process but it was still complex and expensive.

In fact, one of the reasons it was actually fairly difficult to qualify to lease an EV1 (as the movie shows) was not because GM had some dark hidden agenda, but rather they had to take the time to figure out which city, county, and state tax incentives the customer was eligible to receive (so a lease price could be calculated). Additionally, they needed to ensure that they owned or rented a home that could accommodate the charger installation and an estimated cost could be provided to the customer before they signed the contract.

The other thing about the mandate is that it was not really created in the interest of cleaning the air in California. Despite what the movie makers and activists believe, the mandate was likely the least efficient way to clean the air in California. In terms of dollars spent per pound of emissions removed, forcing the sale of EVs in California was a politically easy and high-profile move by the CARB, but was not a wise use of consumer money. Think about it. Big Diesel trucks in California are still unregulated. Unlike a lot of Eastern states, there are no regular safety tests of olders cars in California. Smog checks are easy to get around but full inspections are not (I’ve owned a lot of older cars… don’t ask me how I know about this). Taking one beat up and ill-tuned Chrysler Cordoba off the street and replacing it with a brand new Chevy Cobalt will do more to clean the air than taking someone ready to buy a new BMW and getting them into an electric car instead. Heck, it would have been cheaper for GM to give poor drivers with substandard cars new Cobalts instead of building and marketing the EV1. They sure as heck aren’t selling them for a profit anyway. If it costs GM about $8k to build a Cobalt, they could have given away 187,500 of them them to replace old smoky cars for the money they spend on the EV1. That’s more Cobalts than they sold all of last year and these look like miracle cars compared to the technology of 1977.

No, CARB’s regulators were not thinking rationally when they came up with the mandate. I think they did it for political reasons then backed themselves and GM into opposite corners where neither party could back down.

4- The EV1 wasn’t the miracle car it’s portrayed to be in the movie.

The movie claims that the cars were maintanance and trouble free miracle-cars. In fact, there were many many problems with the cars in consumer hands. Besides a recall for charging ports catching on fire, battery failures were common along with a rash of other issues. Some owners ended up driving Saturn loaner cars for months while waiting for parts or fixes for their EVs. These were essentially hand-built cars that used bleeding-edge technology of the time. They weren’t so trouble-free that service departments feared losing their profits… rather they feared clogging up their service drives so that they were unable to service their regular cars!

Granted, some of these issues could have been prevented. GM’s union contracts forced them to use A/C Delco lead-acid batteries for the first generation of the cars. After Delco was sold off to become Delphi (we all know now how well that has gone for them), GM immediately switched to Panasonic batteries which not only cured many of the warranty expense problems but also increased the nominal range of the cars immensely! In fact, I would argue that the car to have was the Panasonic-equipped lead-acid EV1 which had more than enough range for most commuters (70-80 miles on average) with much lower cost than the NiMH batteries of the series 2 EV1 which had a range of 120 miles or so, but had overheating problems, would create copious amounts of moisture while charging (to the degree that some owners saw gallons of water accumulate under their cars). With mass production, Pb batteries in the volume needed for the EV could cost less than an internal combustion engine. At the time, the NiMH batteries in that volume cost nearly $50,000… for a car with a capitalized least cost of $34k. It doesn’t take a Harvard MBA to figure out that this isn’t a money-making formula. Anyway, I digress.

I agree that EV1 drivers, for the most part, were highly enthusiastic about their cars as was I. However, this had nothing to do with their reliability and low maintenance needs but rather the styling, the performance when they were running, and the feeling of driving such a quiet and clean car.

5- GM knew they wouldn’t make any money on EVs in the short term.

The movie makes a good point that GM made a lot more money selling Hummers than EV1s… in fact they bring in Ralph Nader to make this point. True, and gasoline cost about $1.25/gallon at the time and SUVs were selling like air conditioners in Texas. However, I think this point oversimplifies the point and attempts to make GM planners look like idiots that they were not.

The engineers and planners at GM knew that EVs were more easily compared to personal computers than to cars when it came to technology updates. Moore’s Law certainly held true during the live of the EV1. The first generation car was highly advanced but very expensive to build. The second generation that came out in 1998 was already much further advanced, with control electronics (the brain of the car) half the size and half the cost of the original. Production of advanced batteries has also increased substantially with the advent of laptop computers, PDAs, cell phones, and digital cameras in the past decade. One of the reasons that the new Tesla electric car is able to drive the range it does is because they are able to use thousands of standard sized Lithium Ion computer batteries rather than the expensive purpose-built batteries of the EV1. GM knew that these changes were coming and that they could have a head-start on electric cars with the EV1.

However, the fact is that GM didn’t make any money selling internal combustion engined cars either! GM hasn’t made money selling and producing cars in North America in a long time. Their only profits this decade came from financing and their mortgage division. GM had a lot of bigger problems than figuring out how to make money selling a few thousand electric cars.

While Ralph Nader and the movie makers like to portray GM and its executives as big, rich, isolated, myopic, evil, and self-serving they had it wrong. GM is not rich. They lose billions of dollars a year selling cars. It’s hard to believe, but they didn’t have unlimited resources to make everything and given these problems, I think cutting the EV1 program (as much as it pains me) was the right thing for them to do in the short term. Corporations have to be self serving by law… the managers are held responsible for the financial interestes of the shareholders of the company. Mr. Nader may not understand this, but GM managers certainly did in this case.

Personally, I believe that GM’s greatest failure with the EV1 was in not using it as an example of their environmental leadership and not moving on from there quickly with something else like hybrids.

Today, despite their sales of hundreds of thousands of gas guzzling trucks and SUVs, Toyota is regarded as the “greenest” auto maker. I agree, their hybrid cars are fantastic for the environment and very well engineered, but I believe that GM had a big opportunity to put themselves in this position and they blew it. Big Time. Hummer big.

Once again, GM is playing slow leader and trying to catch up. They almost act as if $3.00 per gallon gasoline came a total shock to them. It certainly caught their product line-up totally off-guard.

6- There was a deep waiting list for EV1s.

I agree with the movie on this point. In fact, the local event-focused marketing efforts worked and the Saturn EV specialist team indeed created a deep list of thousands of interested people. There was actually a good amount of momentum growing as friends, coworkers, and acquaintances of early drivers saw the cars in action and got to experience them. Large employers in Northern California like HP and Sun Microsystems invited us in for full-day ride and drives on their campuses and many of them began to install free chargers for use by their employees who leased the cars. It was a heady time.

The problem was that there were no cars available to deliver for over a year.

Between the first generation EV1 and the second, GM had huge unexpected delays. It wasn’t a matter of simply taking out the lead-acid batteries and popping in Stan Ovshinsky’s NiMH packs like the movie alleges. Rather the entire car had to be redesigned to accommodate special cooling requirements and drainage needs of these new cells. Special venting and cooling had to be designed to keep the batteries from overheating (remember, they also leased them in Arizona where ambient temperatures alone could kill a $50,000 battery pack). I think GM jumped into Ovonics without a full understanding of the engineering difficulties their batteries entailed. Even former GM CEO Bob Stempel went to work for Ovonics as their CEO after leaving GM (you can see him in one of the ads shown in the movie). Talk about an old-boy’s club.

So, while I think that GM grossly overstates the point by claiming that only 50 people of the list of thousands turned out to be serious, they also ignore the issue that more than 12 months had passed since most of these people filled out paperwork to begin the leasing process and they were finally contacted to see if they wanted the car. Customers lose interest, buy other cars, and just distrust companies when this happens.

My final thoughts:

I like electric cars and I still believe that there is room in our marketplace for them. I personally wish I was driving one now and I wish it could be an EV1… despite the issues, I think was an outstanding product. I also know some of the folks working on the new Tesla and I wish them the greatest of luck.

However, to think that the dimwits running General Motors actually had the forethought or the power to pull off a “conspiracy” like the one portrayed in Who Killed the Electric Car? is just ridiculous. You think if these guys had the wherewithal to sway public opinion to the degree alleged in the movie that they wouldn’t first use this power to get people to buy the cars and trucks they already make and to pay what they want for them? Heck, they can’t even give these cars away in some cases!

I still live in Northern California and I swear that I don’t even know a single person who owns a GM car (including me!). I see some driving SUVs, but can’t name a single one who drives a passenger car made by GM (or Ford or Chrysler for that matter). The EV1 was unique for GM in many ways. It was the first time they branded a vehicle “GM” instead of as one of their divisions. It was the first time they put a small corporate team out in the field to handle the sales and service needs of customers directly. It was the first time they knowingly went out to sell a product they rationally knew they could not make money on for years or even decades. And it was the first real opportunity in more than 30 years for them to change public opinion in places like California about their technology, their products, and their company. But they failed.

They didn’t fail because there isn’t a market for electric vehicles. They didn’t fail because they had some grand conspiracy to make it fail. I think the movie made some good points but in my opinion they failed because the regulators and bureaucrats making the rules were themselves shortsighted. They failed because the oil industry (that does have more political sway and money than the car manufacturers… certainly more sway with the recent federal administration) was concerned about the mandate and exercised their political and financial might. They failed because consumers, for the most part, are swayed by fashion and fleeting taste for things like huge SUVs and have short memories about things like oil shortages and high gas prices. They certainly failed because of their own corporate inertia. But in the end, Who Killed the Electric Car? is entertaining and passionate but not the whole story.

Originally re-published here