Print 34 comment(s) - last by Reclaimer77.. on Oct 29 at 7:17 PM

A new J.D. Power report says that companies like Nissan are being overly bullish in their estimates of consumer electric vehicle demand.  (Source: Autoblog)
Report says that demand will be 7.3 percent by 2020, falling short of other estimates

Nissan-Renault Chief Executive Officer Carlos Ghosn recently made the prediction that electrified vehicles -- hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs), and battery electric vehicles (BEVs) -- would make up 10 percent of total vehicle sales by 2020.  Other EV supporters have released even higher numbers of what the electrified vehicle market share might be at the turn of the next decade.

Not so fast, says market research and analysis firm J.D. Power and Associates.  According to its new report, electrified vehicles will likely only amount to 7.3 percent of vehicles sold in 2020.  That would mean that 5.2 million of the 70.9 million passenger vehicles sold that year would be HEVs, PHEVs, or BEVs.

John Humphrey, senior vice president of automotive operations for J.D. Power remarks on the less promising forecast, "Consumers will ultimately decide whether these vehicles are commercially successful or not. Given consumer attitudes toward such vehicles and barring significant changes to public policy, including tax incentives and higher fuel-economy standards, we don't anticipate a mass migration to green vehicles in the coming decade."

Price and self-interest will be the driving factors for slower-than-expected adoption, says the report.  States Mr. Humphrey, "Many consumers say they are concerned about the environment, but when they find out how much a green vehicle is going to cost, their altruistic inclination declines considerably. In the U.S., the number of people who say they’re interested in buying a hybrid drops 50 percent when they learn such vehicles typically cost about $5,000 more than equivalent models with gasoline engines only."

The report brings into question the billions in investment that the U.S., China, and other industrial powers are pouring into electrification research.  The Obama administration alone has offered $11B USD in EV-related grants.

It also calls into question Nissan's plans to quickly scale production of its new Nissan LEAF EV from 20,000 units in 2011 to 500,000 units a year by late 2012.  Toyota (Prius MPVPrius plug-in), Ford (2012 Focus EV), and GM (2011 Chevy Volt) are all betting on EVs as well.  Poor demand could force those companies to readjust their plans.

Another danger to electrified vehicles not fully explored in the report is the potential for China's dominance of rare earth metal refining to impede adoption.  China is currently cutting off supplies of rare earth metals to China and the U.S.  Electrified vehicles use twice the rare earths, approximately, than pure combustion vehicles.  Thus supply shortages could limit production.

The U.S. and Japan are reopening rare earth mines around the globe, but that is expensive.  And building a successful refinery for the metals can take 5 years or more.  Ultimately these costs will likely be passed on to the consumer, exacerbating the pricing frustration that the J.D. Power report points to.

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

What people don't know....
By Targon on 10/28/2010 9:56:39 AM , Rating: 1
Many people forget how toxic battery production is as well. If you move the toxic/polluting side of things to a country like China, people often forget that pollution is still being generated, just not here in the USA.

So, it isn't really saving the planet, it just moves the problem to another country.

Then you have the problem that the power grid is not ready for electric-only vehicles, so if people suddenly went to all electric vehicles, we would end up with rolling blackouts, brownouts, and other problems in many towns/cities. Now, how is the electricity generated? Coal, oil, and natural gas dominates the power generation industry, with very little nuclear, and a tiny amount from wind/water based generators. So again, it just moves the source of the pollution from individual cars to power plants. Yes, power plants might not produce as much pollution for the electricity generated as some older cars, but it is still there.

NIMBY, Not In My Back Yard is how many people look at pollution, and it is as good as sweeping dirt under the carpet. You have not removed it, you just put it somewhere you don't see. Eventually, the dirt WILL show up, and the problem will be a lot bigger than if you just cleaned things up properly the first time.

Now, there is something many people have not looked at, and that is also the improvements in engine design over the years. Since the Focus EV was mentioned, I can point out the regular 2012 Focus as an example.

The 2012 Focus will come with a 160 horsepower engine, and get between 37 and 40 miles per gallon highway. The Fiesta which has been advertised a fair bit has a 120 horsepower engine and gets in the 38-40 mile per gallon highway. Neither of these is a hybrid, so that really looks pretty good in my opinion.

All electric vehicles tend to be limited to 200 miles per charge, and many only go 100 miles on a charge.

By mmcdonalataocdotgov on 10/28/2010 12:01:22 PM , Rating: 1
Oh, don't say that about the power grid. The last time I said that, someone replied with a "Yeah, shows how much you know." and I was totally shot down. I didn't have a come back for such a fact-filled reply.

RE: What people don't know....
By mindless1 on 10/28/2010 2:23:23 PM , Rating: 2
You might be overlooking that it is predominantly poorer people who buy these tiny ICE cars.

In other words, nobody really wants them except if financially challenged OR those uninformed enough to think changes of a few percent in gas consumption by a small subset of US passenger automobiles' is remotely close to a significant % of total pollution or oil consumption.

It isn't, though the latter could also be said about EV owners.

RE: What people don't know....
By EricR on 10/28/2010 6:06:31 PM , Rating: 2
The 2012 Focus is hardly a "tiny ICE car" for the "financially challenged OR those uninformed". 5_interiorlhd_focus13_lowres.jpg

RE: What people don't know....
By EricR on 10/28/2010 5:34:15 PM , Rating: 2
Plus, since 2005 the Ford Focus has met the EPA PZEV (Partial Zero Emissions Vehicle) standards. It is a very clean car from an emmissions standpoint.

"Can anyone tell me what MobileMe is supposed to do?... So why the f*** doesn't it do that?" -- Steve Jobs

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki