While overall sales languished a mere 1.3 percent above the first quarter of 2013, high-mileage electric cars, plug-in hybrids, and clean diesels continued a torrid pace similar to what they were experiencing during most of last year. The only laggard in this group was gas-electric hybrids, which dropped almost 16 percent compared to last year, based heavily on declining sales of several Prius models.
Tesla Motors, seller of the much desired Tesla Model S, is no foreigner to the realm of legislative battles. Within more than a few states, including New York and North Carolina, Tesla has managed to win lawsuits and prevent blockage of their non-dealership sales technique, resulting in more of the electric luxury cars on the road than ever.
Unfortunately, Tesla seems to have hit a wall in Texas.
Tesla has set out from the beginning to challenge everything in the auto industry. Tesla’s CEO Elon Musk characterizes himself as an outsider selling a an electric car the auto industry has said it couldn’t build or sell and he set up a network of dealers and chargers all owned by his company. The vertical integration might be something a founding titan like Henry Ford might have appreciated, but it has run into problems in 21st century automotive retail business world.
The issue is state-by-state franchise laws, which set up the conditions for the retail sale of automobiles. They have a long history, rooted in protection for local businesses against potential predatory practices by the deeper pockets of a factory-owned store. Consumer protections are also a part of the franchise system, in theory guaranteeing local recourse for any issue a consumer might have with a product that could have been produced on the other side of the globe.
Tesla argues that the model, like the auto industry itself, is dated and not reflective of new world of electric cars and online ordering. In addition, Tesla says as a start-up it poses little threat to larger, established dealerships and as a purveyor of online pure electric cars, it needs factory control to ensure the educational message about this new technology is fully transmitted.
These are the 10 or more cars and trucks I’m looking forward to spending some time with in 2014. I hope they all make, but I probably should also have saved a spot or two on the list for some surprises. In 2013 we had a few of those and I’m expecting more in 2014.
These things do take time. Wishful thinking won’t get us there. Government money can help, but ultimately it can only play a minor role if the goal is the transformation of a fleet. Cars and trucks that are better alternatives to gasoline ones in every way will be the only way to make it happen. That’s the way gasoline won out over electricity and steam 100 years ago. That’s why diesel won out over gasoline in Europe 15 years ago. That’s why the Toyota Prius is the 10th best-selling car of 2013.
No one should doubt that 2013 was a breakthrough year for advanced technology vehicles, whether running on electricity, gasoline, diesel or some combination of the three. The choices expanded, prices dropped and infrastructure exploded (for plug-ins). This year presents an abundance of riches; as I wrote earlier, we (at least we in California) now have 10 pure electric vehicles to choose from–and 2014 promises and expanded roster of choices. I had the opportunity this year to sample more than half of those available. Add in plug-in hybrids and the list of EV choices almost doubles, while traditional hybrids, clean diesels and high-MPG gasoline vehicles ranks keep growing both in number and popularity.
The year 2013 is almost over and the auto industry is moving toward the best sales year in half a decade. High mileage electric cars, plug-in hybrids, hybrids and clean diesels are drafting along with the positive sales year and going beyond, with each segment besting the overall market as new models enter and draw attention. The expectation is for aggressive selling to continue through the rest of the year, but it’s a good time to regroup and declare the Top 10 winners for the year.
Tesla has spurred more serious activity in the high-end of electric cars than has ever been seen. Its success has other automakers bringing new models onto the market and promises to boost attention on EVs the same way high-end sports cars highlight attention on some of their lesser companion models. At any rate, it looks like we’re in for some fun, high-performance, luxury electric cars in the near future.
To sum up the day-long program and paraphrase the philosopher Heraclitus, the only thing constant about the future will be change. The 100-plus year-old auto industry is heading into uncharted territory as it grapples with change inside and out of the vehicle. Electronic technology promises to radically alter the interaction of the driver and vehicle, even as the propulsion technology and fuel shifts to new ground and, in some cases, necessitating new lifestyles. One thing is clear, “Future Cars, Future Technology” will be an ever-changing topic for years to come.
This week saw two of the largest auto companies in the world going two different ways when it comes to pricing their showcase plug-in electric cars. General Motors announced that it would price its extended-range electric Cadillac ELR at $75,995 when it goes on sale in January 2014. In contrast, the same week Toyota announced that it was dropping the price on its 2014 Prius Plug-in, which it considers the epitome of its current offerings. Price drops ranged from $2,000 on the base model to $4,620 on the Advanced version. With the price reduction, the Prius Plug-in now has a starting price before government incentives just north of $30,000.
While price cuts and low lease rates have been moving electric cars like never before, resulting in “sold out” models and tight supplies at some dealerships, there may be a dark side to the deals. When discounts like this happen in the rest of the auto market and residual values drop, the impact on auto companies is clear. Profits on the discounted vehicles drop and the models are often dropped or given a redesign aimed at revitalizing or repositioning them in the eyes of the consumer. For new models, it is often the kiss of death.
August was a high-water mark for some of the pure electric cars and plug-in hybrids, stoking hopes that these alternatives were starting to gain traction in the market. The year 2013 is two-thirds over and auto industry sales overall are doing quite well (up 14 percent compared to July 2013, up 17 percent compared to August 2012 and up 9.6 percent over the year-to-date compared to last year). The record sales this month by the Passat TDI, Chevy Volt and Nissan Leaf show that high mileage vehicles are definitely high on consumers’ shopping lists. More models continue to come onto the market, broadening consumer choices and adding to the ongoing discussion of fuel economy.
The Nissan Leaf was the best selling plug-in car in July and has just lost the lead for the year-to-date electric car sales to the hot-selling Tesla Model S, another pure electric. It’s fair to say that where the Leaf is selling well, electric cars are selling well. Here are the Top 10 markets for Nissan Leaf sales.
Consumers interested in plug-in cars got more good news this month as the Mercedes-built Smart and Chevy Volt both joined the recent moves to drop prices on their models. The Smart dropped lease prices to $139/month, substantially below much of the competition, and GM lowered the 2014 Chevy Volt price by $5,000.
Numerous peer-reviewed articles have reached the same conclusion — from cradle to grave, electric cars are the cleanest vehicles on the road today. And unlike cars that rely on oil, the production of which is only getting dirtier over time, the environmental benefits of electric cars will continue to improve as old coal plants are replaced with cleaner sources and manufacturing becomes more efficient as it scales up to meet growing consumer demand.