THE BLOG

EVs - 5 remains the magic number

09/21/2012 06:14 pm ET | Updated Nov 21, 2012

Whatever happened to electric cars?

The Nissan Leaf, America's only true mass-produced EV, remains a slow seller. Sales of the Chevrolet Volt (really a hybrid and not an EV) are so disappointing that General Motors has shut down production for "inventory adjustments". Other EV models, such as the Tesla, are produced in such low volumes and at such high prices that they barely register a blip on the sales charts.

It appears that before it even blossomed, the bloom is off the rose for EVs. But the real reason is gas prices.

As former GM Vice President Bob Lutz once told me, "The major factor in buying a car is the the price of gasoline."

And, in my opinion, as long as gasoline remains below $5 a gallon, EV sales will remain in the doldrums. But is $5 inevitable? And as long as gasoline-powered cars and many hybrids are rated by the EPA at an amazing 40 miles per gallon, will buyers be willing to take a chance on what they consider the "new" technology of EVs?

Another major problem with pure EVs is called "range anxiety", which is the driver's nervousness at not truly knowing how many miles are left "in the tank". An "extended-range hybrid" like the Volt and plug-in hybrids take care of that problem. But GM did such a poor job in explaining the Volt to the public that it may be too late for that car to really catch-on, especially with "early adapters", those willing to put their money where their green mouths are and park the latest model in their driveway before their neighbors. The sad part of this story is that the Volt is a truly amazing car, with plenty of interior space, a huge driving range with its small 4-cylinder engine constantly charging the drive batteries and a ride and handling approaching that of a "real" car, the kind which people are used to driving.

Manufacturers realize that no matter how much they advertise and promote their EVs, as long as the price of gas remains under $5, they simply won't sell.