Electric Car Sales Slower Than Expected in 2012

In a few weeks, we’ll come upon the four-year anniversary of when candidate Barack Obama proposed that America put 1 million plug-in electric vehicles on our roads by 2015. Even before the sale of the first Chevy Volt or Nissan Leaf, most observers knew that hitting the seven-figure mark by 2015 was more aspirational than an actual goal. Recent sales numbers for EVs in the U.S. have reveal market challenges facing battery-powered cars.

Last week, Nissan reported that June 2012 sales of its electric Leaf reached 535 units—less than one-third of the 1,708 LEAFs sold in June 2011. Throughout 2012, monthly sales numbers have hovered around the 500-unit mark. That’s a troubling sign for EVs because Nissan had announced that its sales would double from 9,674 in 2011 to nearly 20,000 units this year. If trends continue, Nissan’s Leaf-manufacturing facility in Smyrna, Tennessee—expected to come online in December—could operate well below its capacity of 150,000 units annually.

Sales of the Chevy Volt plug-in hybrid have fared better, with General Motors reporting that it sold 1,760 units in July 2012—one of its best months so far. The record for Volt sales was March 2012, when the company sold 2,289 units. All signs indicate that the market for plug-in hybrids, which run mostly on electricity but use a gas engine to extend driving range, will be more popular than pure electric cars in the United States.

The Toyota Prius Plug-in Hybrid, which went on sale in March, has already surpassed the Nissan Leaf in sales for 2012. Toyota sold 4,333 plug-in Priuses so far in 2012, while Nissan managed to sell just 3,148 Leafs through June. The current tally for 2012 Volt sales is 8,817.

The biggest challenge is cost, because pure electric cars have large expensive battery packs. In a consumer survey conducted by Pike Research, a clean tech research firm, respondents said the optimal price point for selling a plug-in electric vehicle is $23,750. That’s approximately $10,000 to $15,000 above current price tags, depending on the model.

Other explanations for slow Leaf sales include lack of national distribution, which is just getting established—and consumers waiting for the 2013 model, which will have a faster charger and other enhanced features.

“Realistically, we think a plug-in hybrid at 340-350 miles [of range], or a car at double the Nissan Leaf range can satisfy a lot of needs,” said Steven Chu, secretary of U.S. Department of Energy. Chu was speaking in late June at a D.O.E. conference in Michigan. “We think the price point of $25,000 is a very real price that we can maybe achieve in a decade.”

Carlos Ghosn, Nissan’s pro-EV CEO, echoed the same sentiment regarding cost, last month calling for electric vehicles to sell at the same purchase price as gas cars by the end of this decade. In the meantime, electric cars are likely to sell at a steady pace—albeit slower than President Obama and other EV-supporters had hoped.

Article by Brad Berman, appearing courtesy Ebay Green Driving.

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One comment on “Electric Car Sales Slower Than Expected in 2012

There maybe 3 reasons why the sales are not very high and have gone down.

1) These electric cars and plug-in hybrids are not very nice looking (I think they’re just plain ugly)

2) The price of gasoline has gone down from January to July.

3) The market they address is wrong. These cars are expensive compared to similar small non-luxury cars, so they address the middle class market, who’s very price-conscious.

Tesla has already 10,000 orders for an all-electric car that’s priced between $57,000 and $105,000, and they said they’ll ship 5,300 this year alone. All that with less than 30 dealerships.

And when BMW and other luxury car makers (Mercedes, Audi) start selling EV’s in the US, we’ll have much better looking cars, and it might create a bit of a hype. And the market they address has a lot more money to through at a car than the middle class.

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