According to the "MIT Technology Review," in the first three years after their first introduction into the United States, sales of Electric Vehicles (EVs) have exceeded the number of hybrids sold in their first three years by at least 50 percent. The first EV introduced into the U.S. was the General Motors EV1 in 1997; the EV1 had an approximate range of 55 to 95 miles and the cost was $49,350. Today, one of the most popular EVs is the Nissan Leaf with a range of 75 miles and a price tag of $28,800.
When we refer to a "hybrid" vehicle, we mean one that combines an internal combustion engine with one or more electric motors, but does not draw electricity from the power grid. An Electric Vehicle (EV) refers to both plug-in hybrids like the Chevy Volt and the Toyota Prius, which do.
The top five countries where EVs are the most popular are the U.S., Japan, France, China and the United Kingdom. The U.S. leads the world in EV sales with 71,174 units sold; Japan is at 44,727; and China is at 11,573. Our forecast is that the number for China will increase quickly – presuming the economic slowdown is not severe.
Over the years, the car companies and governments have spent billions of US dollars ($6.7 billion) in research and development to extend battery life, and it has paid off. In 2008, batteries for electric cars cost $1,000/kilowatt hour; by 2012, the cost was less than half that number ($485).
We believe that in 1997, when hybrids were first introduced, there were relatively few manufacturers and the cost was fairly high; now in 2013, we have many of the major manufacturers offering EVs and the prices are almost reasonable for the investment. Plus, the government is helping things along with tax rebates.
That said, we do not expect the growth curve for EVs to continue indefinitely, because many people buy vehicles to take them distances greater than 100 miles. However, now that the cost of hybrids has dropped and people are more conscious of emitting hydrocarbons into the air, we will see sales of hybrids accelerate. (Pun intended.)
