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Cost, charging infrastructure and battery concerns are all reasons for the slowed adoption

Electric vehicles (EVs) are not taking off quite as expected, and if sales numbers don't start turning around, this could spell long-term trouble for the industry, according to a new report from The Detroit News.

Back in 2009, the Obama administration awarded $2.4 billion in stimulus grants for EVs and advanced batteries. The investment seemed promising, since gas costs continued climbing. Who wouldn't want an EV in the days of paying $5 per gallon?

The answer is, apparently, most people. Pushing EV adoption has been difficult for a few reasons, including cost (despite huge federal tax credits and incentives, EVs are more expensive than gas vehicles), slow deployment of charging infrastructure and battery worries.

Right now, the federal tax credit is $7,500 per EV in the U.S. President Barack Obama has proposed upping this figure to $10,000 in order to make EVs more affordable. He also proposed a $1 billion budget for speeding up EV deployment and charging infrastructure in 15 communities.

Despite these efforts, and the fact that EVs can lessen the U.S.' dependence on foreign oil and reduce global warming, there was one issue that likely scared many customers off: lithium ion battery problems.

One such instance was the Chevrolet Volt's battery fire in May 2011, where a Chevrolet Volt underwent a series of tests at the National Highway Traffic Safety Administration (NHTSA) facility in Wisconsin. Three weeks after a side-impact crash test on May 12, the Volt caught fire while parked in the testing center.

Fisker Automotive has recalled its EV batteries for the Karma due to recent troubles, and the Nissan Leaf recently experienced some issues with the Arizona heat.

2012 Chevrolet Volt plug-in and 2012 Nissan Leaf sales have been all over the map over the past year. In 2011, 7,671 Volts were sold while 9,674 Leafs were sold. From January to September 2012, Leaf sales dropped to 5,212 while Volt sales jumped to 16,348.

According to The Detroit News, this is because the Volt has an auxiliary gas engine that kicks in when the battery is drained. To some degree, it still relies on gas, and the U.S. just isn't ready to take gas completely out of the equation yet.

Nissan hoped to sell 20,000 Leafs this year, but clearly, that is unlikely to happen.

A recent hit to the EV industry was A123 Systems' bankruptcy filing earlier this week. A123 made EV batteries and developed advanced battery technology.

There are some bright sides to the EV industry, though. Ford just added 60 new EV engineers and doubled in-house battery testing, and Toyota is talking plans for new EVs and hybrids.

The adoption of EVs may just take some time, and could likely get a boost in the coming years as the CAFE standards for gas-powered vehicles continues to increase. The Obama administration just recently finalized the 54.5 MPG CAFE standards for 2017-2025 model years.

Source: The Detroit News

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Tax Credit
By mchentz on 10/19/2012 10:20:32 AM , Rating: 2
How come the media and government don't understand that tax credits (Useless to most people that make under 100k and makes the EV's priced like a entry luxury car as a result)and the lengthy charging times which limits its usefulness are probably the 2 biggest issues with EV's? Not to mention there is barely any EV infrastructure.

RE: Tax Credit
By jimbojimbo on 10/19/2012 11:01:52 AM , Rating: 2
Useless to people that make less than 100k? What math are you doing and who does your taxes? Even if you earned 50k and paid, I'm being very easy here, 15% federal taxes, that'll get you your full $7,500 tax credit back. If you make 90k and aren't paying $7500 in taxes I'd like to know how you're doing it. I guess you could be giving 40k of it to charity... right?

RE: Tax Credit
By mchentz on 10/19/2012 11:38:09 AM , Rating: 2
I stand corrected. Married couples need to have a taxable income of 55k or more to benefit. So with normal tax deductions roughly means they have to have an income of over 70k not 100k as I originally stated. Single people probably have to make less since they are taxed at a higher rate.

BTW you are supposed to have a receipt for charitable donations.

RE: Tax Credit
By Dr of crap on 10/19/2012 12:20:26 PM , Rating: 2
Yes, I do have a recept for every deduction I take!

<sounds of looking through lats of papers>

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