Although their numbers are small, electric vehicle owners worldwide are generally happy with the new technology. In the U.S., for example, the Chevy Volt has topped Consumer Reports’ annual owner satisfaction survey two years in a row. The Volt overcomes range anxiety by adding a small gasoline engine to its electric drive train, while the all-electric Nissan Leaf depends on a network of public charging stations. All the companies offer home chargers to their owners.
According to Gartner, the issues at Better Place won’t affect electric cars elsewhere. In the U.S., sales of the Chevy Volt, Nissan Leaf and Tesla Model S are all growing, albeit off a very small base. “While the payback period for some EVs today is too long, we are still in the early days of the industry,” he says.
Better Place executives, including Agassi and Evan Thornley, who briefly succeeded him as CEO, say there’s nothing wrong with the company’s strategy.
“I continue to believe that the Better Place vision is both accurate and commercially sound, and trust that whatever shortfalls we suffer are correctly seen as errors of execution not of strategy,” Thornley wrote to employees when he left. Mike Granoff told me that “a million things didn’t go right,” but that Better Place’s approach still makes sense. The company sold more than 100 cars a month in January and February, accounting for about 0.5 percent of all sales in Israel. In December, only 23 were sold.
Others, though, say the Better Place story underscores the fundamental challenge facing the electric car. Without battery-switching, pure electric cars have a limited range and they take a long time to recharge.
“The gasoline fuel tank is a pretty phenomenal storage device for energy,” says Brett Smith, an industry analyst with the Center for Automotive Research. “The battery may never really compare, at least not in the next 20 years.”
Then again, whatever their flaws, there’s no doubt that electric cars generate what economists call “positive externalities.” They’re good for the environment and for a nation’s security because they reduce dependence on oil imports. That’s why the Obama administration, which set a goal of getting 1 million electric vehicles on U.S. roads by 2015, has thrown its support to electric cars, providing about $2.5 billion in loans and grants to electric-car manufacturers and battery makers, as well as $7,500 in tax credits to electric car buyers.
But the administration, as well as the industry, has yet to provide a clear answer to a simple question about electric cars and companies like Better Place: What, exactly, is the consumer problem that EVs are trying to solve? Are they about saving money in the long run, not having to worry about rising gas prices, reducing the environmental impact of driving or just enjoying the ride? Put another way, if electric cars are the answer, what’s the question?
Photo of Shai Agassi provided by the Better Place Flickr page.