In August of 2009, the White House announced a stimulus package worth $2.4 billion to move the electric vehicle industry closer to commercialization. The bulk of the money went to companies involved in producing batteries to help speed up the cost reductions that are felt to be necessary to make EVs affordable to most consumers.
Now 14 months later, very little of that money has been spent, and only a few hundred jobs have been create.
The Recovery Act’s Electric Drive Vehicle Battery and Component Manufacturing Initiative and Transportation Electrification awards allocated $2.4 billion in matching grants to dozens of small and large companies. From the nine largest awards, totaling more than half ($1.38 billion) of the grants, only 10 percent of the funds have been spent so far. The total number of jobs created from this $138 million is just 409 through June 30, 2010, and two of the awardees (Dow Kokam and Compact Power) have not reported any jobs created.
Several of the battery manufacturers have broken ground on battery manufacturing plants, with production slated for 2011. Since the White House announcement, the battery awardees have had very limited success in securing contracts with light duty vehicle manufacturers.
Battery companies EnerDel and A123 Systems have each invested in the companies to whom they will supply vehicles (Think and Fisker respectively). Both automakers have delayed their vehicle launches in the U.S. until at least 2011. (A123 Systems has had more success in selling its batteries to the trucking industry and for energy storage applications to support the power grid.)
Therefore, by the end of this year only the Chevrolet Volt (with batteries from Compact Power) and the Ford Transit Connect (with batteries from the Johnson Controls-Saft partnership) will have been directly impacted by stimulus funding. Of the eight leading electric and plug-in vehicles expected to go on sale in the U.S. by 2012 (Nissan Leaf, Mitsubishi I-MiEV, Chevrolet Volt, the Coda Automotive Sedan, the Toyota Prius Plug-in Hybrid, Fisker Karma, Think EV, and Tesla Motors Model S, just three will use batteries from companies that have received stimulus money.
The stimulus package also included $100 million for Ecotality to oversee the installation of charging equipment in 16 major cities. While the project is moving forward, just 4 percent of the money has been spent.
Stimulus funding will likely have a much greater impact starting in 2012 when electric vehicle and battery manufacturing are slated for close to full production. This should result in the direct creation of thousands of jobs. Volume production of batteries in the U.S. should also reduce the cost of batteries for the second wave of EVs in the years that follow.
Article by John Gartner, appearing courtesy Matter Network.