Is the EV viable?

Britain's Institution of Engineering and Technology has its doubts about electric vehicles -- but it's being drowned out in the marketing din.

The Institution has dealt a quiet blow to the auto industry's push to persuade consumers to look towards EVs. An article in its June journal declares that limitations to battery development will likely hobble the market penetration of electric vehicles for many years to come.

This article is published against a backdrop of high profile publicity for EVs -- the subject of the most powerful marketing push in years. Electric sports car pioneer Tesla's recent NASDAQ float has met with a massive burst of investor enthusiasm, while Nissan, with more than 20,000 orders worldwide for its Leaf, is tooling up to fulfil orders for up to 500,000 of the affordable all-electric hatch by 2012. The Leaf touches down in US showrooms later this year with a base price of $32,780.

Despite the buzz generated by car makers, the UK Institution of Engineering and Technology says consumer perceptions continue to put EVs well behind conventional combustion engines for performance and range, and not without reason, according to the story in its journal. The article asks some sticky questions about the limitations forced on car makers and drivers by battery technology, asserting little has changed on the matter of range since 1910, and with no obvious solutions on the horizon.

To put EVs in perspective against their conventionally powered counterparts, the Institution says it would take a battery pack larger than the entire car, weighing about 1.5 tonnes and costing over $200,000 to deliver the 600km drivers currently get from a standard model Ford Focus or Volkswagen Golf in a mix of driving conditions and at speeds of up to 110 km/h.

Putting it that way, it does appear the industry has a way to go yet.

The Institution lists three main problem areas casting a shadow on the viability of EVs, all of which are complex enough to ensure it will be some time before a ready solution is found:

1. Battery technology is the laggard of the electronics industry. While the discipline has seen performance increases of about 10,000 percent in the past 35 years, battery performance has only increased 500 too 600 percent over the entire century. Making EVs viable in the minds of consumers presents the battery industry with a serious catch-up challenge: making that kind of progress again, but in a decade rather than another century.

2. The truth bomb ticking away in range claims about the industry's current great hope -- lithium-ion technology. Manufacturers base their claims on tests running batteries from 100 percent charge to zero. Such usage patterns seriously compromise Li-ion life expectancy. For the battery to have a lifespan acceptable to consumers, charge levels need to be kept between a 20 percent floor and an 80 percent ceiling.

3. Multiple issues with charging. Filling a battery from a domestic power outlet is a slow business -- the Institution suggests around 13 hours on average. Constant recharge-discharge cycles compromise Li-ion's functional capacity, and the consequences of doing this on high-voltage rapid-charge outlets have not yet seen anything like the empirical studies required for anyone to make any guarantees. According to the Institution, it might be a decade before a "true picture in a real life environment" emerges. This, it says, casts serious doubts on the warranties they might be able to offer on what is the costliest component of any EV.

While it's safe to expect cost reductions over the next decade, the Institution says, EVs will remain "significantly more expensive and heavier" than conventional cars and will remain cruelled by significant range shortfalls. Adding to this the likelihood that over that time they will draw most of their power from non-renewable sources, EVs "could actually contribute more CO2 to the environment than a current high efficiency diesel model".

Not that you'd know any of this looking at the numbers under TSLA, Tesla's stock code on the NASDAQ. Across the Atlantic it's all sunshine and smiles with the EV world wunderkind's shares going hyper-bull with a 41 per cent surge from US$17 to $23.89 a share in its first day's trading -- decidedly at odds with the rest of the market in an otherwise bleak day which saw the NASDAQ down 3.85 percent and the Dow falling 2.65 percent -- and during a period in which dozens of other IPOs have been cancelled.

Tesla's early success should come as no surprise, with pre-float buy-ins from kingmakers like Daimler and Toyota and plenty of encouragement from a federal administration working to put a million or more EVs and PHEVs on American roads by 2015. Tesla's projected contribution to that goal earned it US$465 million in Department of Energy loans.

That kind of imprimatur suggests that regardless of the Institution's misgivings, there are plenty of people out there determined to make EVs a day-to-day life reality, by hook or by crook, with gritted teeth, white knuckles -- whatever it takes.

If there's a flaw in the UK Institution's logic, it lies in its failure to take into account the possibility that in time consumers can be persuaded to change their habits to suit changing times. That's not beyond the bounds of possibility with the kind of impetus the EV industry is getting now.

Tesla founder Elon Musk is betting everything he has on it -- including profits on the US$112 million revenues from his company's existing product, the Roadster. The losses Tesla has recorded to date are voluntary, he says, with the company sinking what would otherwise be profit, as well as the US$226 million reported to the SEC at the end of day one, back into getting the mass market Model S sedan (pictured with the Roadster) into production.

Automotive News reports analysts don't share Musk's total confidence in the company, given tooling changes at one of its major suppliers ensures zero production for most of 2011 and into 2012, when the Model S arrives.

At this point, however, their doubts are drowned out in the investor buzz.

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