John Petersen is one of the most thoughtful critics of the electric vehicles industry. In a phone conversation I had with him a few weeks ago, he laid out a few reasons why he thinks the whole idea needs to be scrapped. Here, in his column on AltEnergyStocks.com, he further defends his position, pointing out the folly of the plug-in hybrid Fisker Karma, and suggesting that those who invest in the glutted lithium-ion battery market are imbeciles.
Although there is a lot of truth here, as there is to everything John writes, I point out a few things:
To be fair, we shouldn’t equate the legitimacy of the Fisker Karma to the EV industry as a whole. I do not defend the process by which American taxpayers were forced to support Fisker. In fact, if I were making a commitment on the taxpayers’ behalf, it would have been several smaller bets on lighter-weight battery electrics designed for urban commuter transportation, predicting that, over time, we will want smaller, lighter, more efficient cars, rather than $100,000 behemoths that weigh 5300 pounds and get 20 MPG after their quite limited battery-only range is expended. I’d be shocked if there weren’t an incredible amount of stupidity and corruption in this decision, but again, this is hardly a valid indictment of the industry as a whole.
John quotes the EV adoption curve as predicted by Lux Research, which is quite pessimistic. Others take a very different view.
In particular, Lux Research predicts almost zero penetration of EVs as long as gasoline prices remain low. OK, suppose gas prices in the U.S. stay around $4/gallon. Isn’t there a scenario under which we as a civilization conclude that we need to put a spear through our addiction to oil, even while its price stays (artificially) low? Isn’t it possible that we could wake up and start to care about the externalities of fossil fuels, vis-à-vis the environment, lung disease, or national security? Isn’t it at least conceivable that we could start to question the validity of borrowing an incremental billion dollars a day and sending that wealth offshore to empower our enemies?
To be frank, maybe not!
In any case, I respect John as a brilliant guy, but I think there’s more to the story here.