EVcast #25: Interview with Chelsea Sexton on "Who Killed The Electric Car"

Maybe General Electric will buy Ford.

Guys... I don't know what Chelsea was talking about. I've never heard of her before. I'm all famous though, so maybe she's one of my groupies. (this added just to see if she'll read the comments).

OK, so after talking with her, I wonder if you (Bo) have changed your take on the whole "demand" thing at all? The reason I bring this up is because *I* was demanding the car, and could not get one. And I realize that my one desire isn't any indication of a large market, but it is something that I was directly involved in. To hear GM say that I didn't exist is a tough one to swallow. One thing that Chels didn't cover at length is how many people (like me who were) turned away with the EV1 lease process. There are many who will simply never lease a car, and there are those who won't buy without a test drive, and there are those who won't buy unless they can drive the car home the same day. There are also those - like me at the time - who didn't earn enough money to qualify for the car, though I could have paid cash for the purchase value listed on the lease agreement. These cars were not sitting around waiting on buyers as "we could only sell 800 of them" seems to imply. That there was ANY waiting list for a car that was so difficult to get (and even get information on) speaks volumes about how much market there *could* have been if GM truly worked it.

Chels made a GREAT comment about the slow start of the Prius for comparison. A whole new car isn't going to sell 100,000 in the first year. You'll never know what the demand really is until enough people realize what it is and why they need it. At the time, not enough people were told why we needed EVs. We were sure told why we needed SUVs though, eh?

Great comment about the $billion add budget that GM has. That makes the $billion EV1 project seem like smaller potatoes. After all, GM only sells us the cars that we already want, so why are they wasting ANY money on advertising them to us?

Errr. ^^^ that was me. I couldn't log on!

- Darell

Chelsea did shed some light on many issues for me.  What resonated with me most is how the Dodge Viper sells only about 2000 a year, and does well (profitable), so why couldn't an EV?  That is a great point... I was thinking major auto mfgs had to create a mass market winner for it to pay off.

As for *enough* demand, sorry, still don't buy it.  If just GM were leasing/selling EVs at the time, then yes, I would say they should have committed to producing more to meet additional demand (again, big difference between "no demand" and "not enough demand").  Toyota sold only 300 RAV4 EVs a year - and you know how great those cars are! Same story with Ford, Nissan, Honda.... all released EVs and acceptance of this was isolated to a passionate few (I might have been one of those passionate few if given the opportunity).  Could all of the auto makers "fudged" the demand? Anything is possible... hey, Japan can make cars run on water! :)  Demand was obviously there, the world was just not ready for it.  Today is a new day and the future looks bright.

>Chelsea did shed some light on many issues for me. 

Great! I notice that she gained a bit more traction with you. She's way better looking than I am, so no foul there. Of course she's also nicer, and I can be a bit snotty.

Chelsea was "the company" and knows exactly what went on from that side. I was "the customer" and saw how it was from this end. Together we LIVED this stuff. We don't learn about it from press releases or the media.

> As for *enough* demand, sorry, still don't buy it. 

The reality of it is that we'll never know, so I've got no interest in debating how much demand there might have been if the car makers wanted to sell the cars as much as they're pushing them today. What I DO have interest in, is the dispelling the myths. Here, let me get this one for you...

>Toyota sold only 300 RAV4 EVs a year

You state this as if it were fact. I'm guesing that you read it somewhere. Wasn't on my site, certainly. And it isn't true. Or to be more accurate, it isn't the whole truth. First off, since 1996, these cars were lease only - and lease only to fleets. None were sold, and no private individual could lease or buy one. It wasn't until 2002 that the retail program began. In 2002, there were 339 vehicles offerd up for sale or lease to private individuals. Toyota expected this retail program to last two years. In eight months (with next to zero advertising) all the vehicles were leased or sold, and the program was closed 16 months early.

So in the eight months that the vehicles were EVER available to the public, those that knew about them (you had to be in the EV loop already to know of the availability), bought or leased them all, and the program was closed.

So.. does this mean that they could "only sell 300 per year?" Well, I guess so because there were only that many ever available, and they were only ever for sale for eight months!

> Could all of the auto makers "fudged" the demand?

The same way they all demonstrated that they would go out of business if forced to install catalytic converters? To install positive crankcase ventilation? To install seat belts? In short: Hell yes. And I don't see anything to be surprised about. It was quite easy to show no demand when so few people even knew the cars existed - and we were all eventually told how much they sucked. According to GM, I don't even exist.

> Today is a new day and the future looks bright.

And I couldn't be more thrilled. Just a bumer that it took $4 and $5 gas to get us to see the light.

About Toyota selling 300 a year: http://www.toyota.com/vehicles/rav4ev/

Straight from the source.  Of course, they could be lying, but....

Firstly, let me say that the EV industry is lucky to have such a beautiful and articulate spokeswoman in Chelsea Sexton.

I don't think it is useful to get stuck on the idea that there were "no customers for the EV1".  This is just the type of hyperbolic talk typical of business people.  Don't get to hung up on the words.

   GM invested a lot into the EV1.  This was not a small modification to an existing vehicle.  The sales volumes needed might need to be fairly high to be sustainable.  I look at the notion that there were "no customers for the EV1" as a short hand for saying the EV1 was not a good investment going forward, in our humble opinion.  This was a guess on GM's part.  I suspect they were correct, but no one will ever know.

   An interesting article showed up recently about GM's sales.

http://gm-volt.com/2008/07/01/gm-on-june-sales-asia-doesnt-have-a-monopoly-on-fuel-efficient-vehicles/

It contained this.

GM hybrid vehicles continue to gain in popularity in the marketplace with 547 hybrid Chevrolet Tahoe and GMC Yukon 2-mode SUVs delivered. There were 295 Chevrolet Malibu, 30 Saturn Aura and 277 Vue hybrids sold in June. For the month, a total of 1,149 hybrid vehicles were delivered, with 4,376 hybrids sold so far this year.

  So it is interesting that 4,376 hybrids for half a year is considered great even though it is spread across five vechicle models.  As Toyota sells their millionth hybrid, I would say GM is doing very poorly.  Surely EV1 could have sold at least as well as these GM hybrids.  Then again, perhaps GM invested a lot less into hybrids than into the EV1. So perhaps this is good business.

Thanks

John C. Briggs

Bo -

Ahh. You don't know how frustrating this is! You are choosing to believe and propogate information from the company that wanted desperately to stop selling these cars - instead of believing the verifiable facts in the matter. You can also go to the GM site and find, "we could only sell 800 EV1s." Again - they could "only sell" the exact number that they ever made available. Not only that... they never sold ANY of the cars. This is not lying. This is just not telling the whole truth.

You did read what I wrote? Did you listen to what Chelsea said? None of what we say is made up. I'm not sure what else to say, so I'll leave it there before I pull my hair out.

I loved "Journeyman". This was an awesome show last fall that my wife and I used to watch religiously.  It was sort of like a modern-day "Quantum Leap" dealing with time travel.  After the first season, NBC decided to cancel it.  Why?  Not enough viewers.  But they were a vocal bunch!  See http://savejourneyman.net/ - what appears to be thousands and thousands of devoted viewers.  Why can't NBC keep this series alive?  There is obviously demand.  They could spend a lot more in promotion, perhaps a Superbowl ad.  But admittedly I have no idea on what it costs them to deliver that program to us.  How are they going to get more viewers if they stop showing it? My guess, they really don't care.  They have HEROS which makes them much more money.  Fact is, more people like HEROS (which is also awesome BTW).   NBC follows the money, which is directly tied to consumer demand.

I miss Jouneyman.  It's gone, it sucks.  But I look toward the future to a new season of shows that I am sure will entertain my easily "entertainable" mind.

There is no question in my mind that the wise short-term business decision was to cancel the EV programs. I'm not claiming conspiracy, and I'm not claiming that there was tons of interest. I'm claiming that the car companies are guilty of garnishing the facts to their advantage. The fact is that next quarter they can make WAY more money on gas cars than in EVs, regardless of demand. But that's not what we're told. We're told that they REALLLY tried to marked these things. They they could "only sell" X number of them even with all this effort. BS.

My ONLY point is to set the facts straight. The car companies don't need their incomplete version of the facts parroted.

As this is to be a show about the present and future of EVs, it would likely be best to keep that focus. If the past IS to be discussed, I would hope that you'd reasearch the reality a bit more instead of just repeating what the car makers had to say about it.

Make sense?

I found it motivating that people like their EVs so much that the battery in their ICE car goes dead.  I think the trend is that battery companies build cars and not silicon valley companies.  The leader at CARB was so convinced with hydrogen (unless he was lying all along).   He should be demoted.   I think CARB should reinstate the rules and make them retroactive to January 1st 2008.  Chelsea should be the CEO of GM imho.

Bill -

Yeah, many of our little club of production EV owners don't even own gas cars. Others, like me, have a gas car but only drive it a couple of times a month. I keep a battery tender on the Prius. My wife commutes in the EV, and I ride my bikes.

Just as the typerwriter companies didn't bring us the best computers, and the telegraph companies didn't bring us telephones - I'm not sure if the ICE car makers are going to be bringing us the best EVs.

We wanted Chelsea to be chair of CARB. But that was back when it was still relevant.

So Darell, how should Bo refer to the EV1 effort.

    "GMs half-hearted effort to bring EVs to the marketplace after extensive arm twisting."

John C. Briggs

John -

The odd and little-known part of the EV1 situation is that GM created the EV1 without being mandated to do so. It was BECAUSE GM proved that a desirable EV could be built that CARB decided to mandate the vehicles.

So the order of events:

GM built and demonstrated the EV1 prototypes (Impact).
CARB says, "Neat! Let's make everybody build these!"
GM goes into "production" with the EV1 and realizes that they won't be turning a profit on these for quite some time.
The EV1s are leased to customers while GM works dilligently in the background to dismantle the ZEV mandate.
GM wins... in the sort term, and the ZEV mandate is gutted.

So the answer to your question is not an easy one. GM made a full-on effort to bring the EV1 to market. Against some amazing odds both internally and externally. And when the EV1 WAS on the market, GM was in full retreat mode on the EV program. To even consider that GM made a genuine effort at making a business out of the EV1 is to ignore all the facts in the matter.

Not easy to put it in a sound bite.  :)

Darell,
   So it sounds like mixed emotions for the EV1 program.

    I didn't know that first part of the history.  I didn't know that the "Impact" helped CARB create the ZEV mandate.  The rest of the history I know.

    GM's position does seem pretty extreme at times.  The few EV1's that were not crushed and given to Universities, GM prohibits them from turning them back into EV's.  They can only make them into PHEV's.  That sadden's me because I would love to see what EV1 could do with modern batteries.

Later,
John C. Briggs