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Is the Electric Vehicle Market Poised for Growth?

Before answering the question, let me start by mentioning that I drove my first plug-in Electric Vehicle (EV) at a test driving event in Atlanta last month (April 2013). Prior to the event I had little interest in EVs, but my attitude quickly changed after test-driving a brand new Chevy Volt. I am not a car aficionado, but I have been driving regularly (15-20k miles per year) for 20 years and have driven a wide range of vehicles from sport and (moderate) luxury cars to SUVs, pickups, and clunkers. I was very impressed when I sat in the driver’s seat of the Volt. Not only did everything look and feel good, but I was also pleasantly surprised when I punched the accelerator and peeled-out a little bit (even with three passengers in the car). The Volt accelerated, turned, and braked responsively throughout my test drive. The purpose of sharing my test-driving experience with you is that I learned something that is difficult to achieve by reading a news article or blog post. I learned that these cars can compete in today’s marketplace. EVs are no longer futuristic concept cars. These vehicles are on the road today and many of them are actually faster off the line than comparable gas powered vehicles (wanna race?). Not only can they compete from a performance perspective, but many EVs are also very attractive looking vehicles (see: Fusion, Volt, Model S & KARMA) which is something hybrids (in my opinion) have struggled with. Back to the question proposed in our title – Is the electric vehicle market poised for growth? The short answer is yes; however, the market has a long way to go before you see a plug-in EV in everyone’s garage. The plug-in EV market has matured considerably over the past five years. Vehicle performance, distance range, and battery life have all improved while prices have modestly declined. Major manufacturers including GM, Ford, Toyota, and Nissan have also entered the marketplace, which has spurred competition and provided new models to choose from. Drivers can now choose between Battery Electric Vehicles (BEVs), Plug-in Hybrid (PHEVs), and Extended Range Electric Vehicles (EREVs). Below is a summary of each:  

Battery Electric Vehicle – an electric vehicle that is powered exclusively by a battery, which must be charged at an off board charging station. A Nissan Leaf is an example. Plug-in Hybrid – a hybrid vehicle that has electric and gasoline propulsion. The electric motor is powered by a battery, which can be charged at an off board charging station or by driving with gasoline power. A Toyota Prius Plug-in Hybrid is an example.

Is the Electric Vehicle Market Poised for Growth? 

Extended Range Electric Vehicle – an electric vehicle that is powered exclusively by a battery, which can be charged at an off board charging station or by using an onboard gasoline powered generator. A Chevy Volt is an example.

Collectively, these vehicles make up the broader plug-in EV market, which sold approximately 52,835 units in the U.S. during 2012 according to the Electric Drive Transportation Association. This was almost a 300% increase over 2011’s total units sold of 17,735. While these seem like promising signs for the industry, it should be noted that total 2012 U.S. vehicle sales were 14.4 million, which means plug-in vehicles only made up three tenths of one percent (0.3%) of total sales. Even if the 300% annual growth trend continues in 2013, EV sales will likely still remain under one percent of total U.S. vehicle sales. There is tremendous potential for the plug-in EV market, but the industry also faces some tough headwinds as it tries to educate consumers about recent technological advances and how many beliefs about EVs have become obsolete. We will address many of these beliefs and myths in a future posts, so please keep reading. ~ Brian –

Is the Electric Vehicle Market Poised for Growth?  

After test driving an EV, the author discusses his view on why the plug-in EV market will succeed or fail.

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