What Will It Take To Make Us A Country Of Electric Vehicles?

EVs are poised to be a huge disruptive innovation in our lives, but they’re not there yet. Once carmakers take a few simple steps, though, the possibilities are endless.

Will electric vehicles reach mass adoption in the U.S.? When and how? What should come first, the manufacturing of more EVs or the installation of the EV charging infrastructure? These are questions that have occupied many people’s minds and many newspaper headlines in recent years.

To begin to really answer those questions, we must look to the concept of disruptive innovation. A disruptive innovation is an innovation that helps create a new market and eventually goes on to displace an existing market, or targets the existing market by picking off the least satisfied customers. Disruptive innovations typically describe technologies or business models that improve a product or service in ways that the market does not expect, first by designing for a different set of parameters or customers and, later, by competing in the existing market, thereby displacing the established product or service over time.

The most well-known historic example of disruptive innovation is also about cars: when the Ford Model T reached mass production and eventually went on to displace the horse-drawn carriage. More modern examples are how e-commerce sites have disrupted brick and mortar bookstores and travel agencies, and how downloadable music has replaced CDs and players. Even right now, the e-book is starting to replace the physical book.

Take a closer look and you’ll see all disruptive technologies have certain characteristics in common. Initially they often resulted in worse performance than the established product or service and were often rejected as a viable challenger. Here are some classic sayings: "I need the tactile feel of my cell phone keypad." "My personal travel agent is invaluable to me." "But I love to flip the pages of my favorite novel." "I won’t give up the sound of my Mustang." I suspect there were more than a few who said: "You just can’t replace ol’ Nelly with a piece of machinery…"

Which is to say: It takes more than just an innovative device to change the game. People aren’t usually excited about change. It takes a supporting cast of integrated complementary technologies and infrastructure build-out. It takes partnerships from vested stakeholders, scalable manufacturing, and favorable policies that when all combined together, ultimately create the disruptive business. They become a game changer because innovative businesses deliver certain benefits that their entrenched competitors didn’t have and in the end deliver the basics: The new product is simple to use, cheaper, or more convenient.

In the case of the Ford Model T, it wasn’t just the impressive design. It took mass production to bring down prices and increase availability. Roads, highways, and gas stations were built, making car ownership the simple and convenient choice for more of the masses. E-books became accessible once a marketplace was established offering consumers device choices, combined with a robust secure e-commerce system, and partnerships with publishers making more titles available and price points competitive, and even distribution rights laws and settlement agreements. Access became simplified: Why go to a store when you can download a book in seconds? As adoption soars, e-book copies are now starting to displace paper books.

EVs today represent a revolutionary technological innovation, but have yet to reach disruptive status. While early adopters are enthusiastically buying EVs, many other consumers are hesitant to switch from gas-powered, internal combustion engine (ICE) vehicles to EVs due to the upfront costs of the vehicles and lack of availability of a ubiquitous charging infrastructure.

With global energy demand expected to double by 2050, and the need to cut CO2 emissions in half to prevent dramatic environmental impact, cleaner transportation like EVs will play a critical role in creating a more sustainable and energy-efficient future. What will it take to see if EVs are just an incremental technology improvement called sustaining innovation or disruptive for the car market? If we apply historical models, EVs will disrupt the incumbent ICE when the following criteria are met:

Widespread access to chargers

Vehicles sit in the "parked state" most of their lives. Once charging infrastructure is everywhere, drivers will be able to easily charge from their homes, workplaces, retail, and virtually all places that cars are normally parked. The concept is simple: Think about coming home and plugging in your car the way you plug in your cell phone, and leaving each morning with a full tank. That works if you live in a single family home with a garage, but many live in apartments or condominiums. Having access to DC Quick charging off major highways will allow confident purchases of pure battery electric vehicles for longer distance drives. Ubiquitous charging and DC quick charging will extend the effective range of EVs. Most consumers will see EV advantages when they see ubiquitous availability of charging.

A competitive marketplace

Not everyone is satisfied with the gas-powered experience. Lately, most drivers are very dissatisfied with the costs to fill up and their car’s MPG rating. But the upfront cost of EVs are more than ICE vehicles. Many find it hard to look past the sticker price and do the math for the longer term cost savings of EVs. As more manufacturers enter the market, technology continues to improve, and manufacturing scales, the upfront cost of EVs, will also go down and enable further adoption. EVs will pick off the most dissatisfied consumers first, and then grow from there.

New markets for non-traditional drivers

Especially in urban environments, there is a volume of consumers that prefer not to own a vehicle because of the environmental impact, infrequency that they need to drive, or other factors. Many of these drivers turn to carsharing services when they need a car. As carsharing increases in popularity, it provides a new sales platform for EV manufacturers. Fleet owners are another important customer base for EV manufacturers to consider, as cost of operation is the lifeblood of that industry. As more fleet style vehicles are offered as plug-ins, fleet managers will adopt them because the total cost of operation for an EV is highly compelling.

Widespread EV education and test driving

EVs help reduce carbon emissions, which will lead to a more sustainable, energy efficient future while reducing air pollution. They offer longer term cost saving benefits for consumers, and they direct consumer fuel spending to cheaper domestic produced energy vs. foreign sources. They have fewer moving parts so they are cheaper to maintain, very convenient to fill up, often safer, and very fun to drive. As in all disruptive technologies, as more people become more exposed, the innovation will start to gain momentum and challenge the incumbent.

Since all these criteria are gaining momentum, it’s clear that EVs are on a trajectory to becoming a disruptive innovation. Electric motors are inherently simpler and there’s no need for a traditional transmissions. EVs are already more efficient and increasingly more convenient to fuel up. As more charging infrastructure is installed, EVs’ effective range will be increased, and as manufacturing of EVs grow, increased choice will bring prices down.

Once EVs are simpler, cheaper to own, and more convenient, they will almost certainly have a disruptive impact on our society, just as the Ford Model T did. At that point ol’ Nelly—the gas powered Mustang—might just be put out to pasture…

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  • Lasertop

    Electrics will become viable when the price drops another 10k and the energy density doubles.  I think the auther puts way to much weight in the idea that people will buy electrics to "Save the Planet".  People who are that Pro Environment and have the disposable income to afford electrics are maybe 1 to 2 percent of the population.  As for me, I would love to own one, but like most people it is an economic decision, when I can rationise the price premium over a ICE Car I will dive in.

  • Mike Calise

    I encourage all opinions from all sides to continue the debate. We appreciate your postings.
    Thank you for all the valuable perspectives and objective comments. Well almost all... the air thing is actually being worked on in India but it will take some time, but please Tweet the Florida trip on Black Beauty…
    Some of the readers may want to frame their thinking wider. The intent of the article is to inform the readers that what classically seems not likely based on the status quo is often not the case longer term. Have smart phone’s replaced landlines yet? Yet smart phones have entered the mainstream - but it took time. Disruptive innovations take time. Many of the comments are based on a snapshot view today. Yes, I still like the tactile feel of my Blackberry frankly, that was me…
    EVs will have their place, and at 100MPG that will put downward pressure on oil prices, allowing us to make the most of our energy with a diversified domestic energy sources including dirty coal, cleaner coal, natural gas, hydro, nuclear, wind, solar. As the grid gets greener in time, so does your car… The Grid is still an ideal mechanism to deliver pervasive energy, and electrons are fungible, and can be traded for loyalty and commerce, meaning someday someone might actually pay you to drive. Like today... Disruptive enough?
    Regarding range, for the BMW, Jaguar and Merc Benz owner demographic, Telsa’s Model S will go 300 miles today and Elon’s staff is busy connecting US cities to extend the effective car range beyond the daily limit of what a person would like to drive at a long stretch. Chevy Volt can go 385+ miles today and still averages 95 MPG for most of your driving to work or back. Many workplaces will offer charging at work, and that alone is a disruptive force. Filling up at work - thanks boss! Look at the Google campus, many will follow. They are really smart people and they are too busy changing the world than wasting time hugging trees. Managing energy is important to them, as it is for most corporations. This trend will continue.
    Has a city parking garage ever paid for your trip home? This is a disruptive force and EVs drivers are quiet about that one as it’s the best kept secret. Have you ever driven a car that goes 0-60 in 4.4 seconds, faster than a Porsche Boxter but seats 5-7, has more trunk space than a cross-over  SUV and a center of gravity near a Lamborghini? That’s a disruptive force…and the mainstream Auto’s are preparing their counters, and they will be great, and we will see a free competitive market, and that will benefit the consumer.
    Is it really a solution to buy a 35 MPG car when the price per gallon is $3.50? (10 cents per mile) and get right back to where we were years ago when we bought an 18 MPG car when the price per gallon was $1.80 (10 cents per mile). Nothing will change if we don’t embrace a step-change in managing energy. A poor economy is not a strategy to reduce oil prices, but American’s find a way to be happy when our gas prices go from $3.85 to $3.15. After all that feels great right??
    On batteries, if you have the ability to lease a car, then likely your lease payments plus your energy bill will be cheaper than just your gas bill today depending on your commute and MPG. This is another “clean” little secret. (Sorry fellow EVrs.) You don’t own the battery, you don’t own the car. This may be interesting to some…
    To drill down further, every major auto OEM is working with battery after life solutions for Grid integrity, building and home backup energy storage, vehicle-to-grid capability that came in handy in Fukushima, and unfortunately not Sandy because the US lags by a year.  Used batteries will be Grid nirvana someday, and 95 percent of the battery is fully recyclable after its second life. You won’t see these tossed in landfills.
    Battery prices are expected to drop with no new technology breakthroughs from about $800 per kW to $400 per kW in 5-8 years just from the effects of manufacturing scale and competition so don’t blink… Many are working on breakthroughs for <$100 /kW that will put range at >600 miles in just more than a decade. We will monitor together, perhaps it will longer but in many ways it doesn’t matter.
    And while we are on the Grid topic, if we added 100 million new EVs and PHEVs to the Grid and everyone charged at night, we would need ZERO additional power plants because the Grid is designed for daytime peak. There are many additional challenges there but nicely, a few interesting perspectives from all nonetheless.
    Again we appreciate your passion on both sides. I’m glad you find this an interesting if not provocative debate. You guys get the last word…
    Best, Mike

  • BD92110

    So many haters on electric cars commenting.
    The author isn't saying that electrics will work 100% of the time for 100% of the population any time in the near future.
    However, the average household has 2.3 cars, and the average driver drives only about 30 miles a day.
    Obviously there is wide variation in those numbers, but the point is that it is reasonable to think that an increasing number of households will consider an electric car as their second vehicle as prices come down and vehicle range/quality/variety increases.

  • Jessica Zenk

    Yesterday's announcement that the Tesla Model S won Motor Trend's 2013 Car of the Year validates many of Calise's points -- as the cars themselves get better and drivers become more comfortable with the (different type of) convenience and cost-savings associated with EVs, EVs will become increasingly part of the mainstream.

  • Richard Lowenthal

    That car is superb.  Same price as BMW's 5 series, better performance, more space, and a lot cheaper to operate,

  • Ann Kwilinski

    Why electricity. Why not air? Why not something that doesn't rely at all on fossil fuels. electric solves none of our long term problems.

  • Don B

    Where would the 'air' come from? I assume you are talking about a compressed air system. Something has to compress the air. Either a gas powered air compressor or an electric one.

    Plus they are loud to operate.

  • 0321ReConUSMC

    The Ra Raa Electric Car B/S Article leaves more questions
    unanswered than answered  .
     First off with Obumma closing down Major Coal factories .
     The cheapest form of energy on Earth the price of electricity is going way up .
     The author does not mention .
     In fact 17-24 % in the last 3-4 Years and is expected to double in the next 4 years . 
     Here in my very cold area 4-5 months a year Electric Cars got 25-30 % less millage than advertised .  
     As you know the 460 Lbs of Batteries per car is very toxic .It takes 2000 Years to become part of the earth . Where would we put 100,000 Million batteries a year ? 
     One wonders where Tree Huggers would allow the batteries to be stored since they want even 
     Now allow electric lines from Solar and Winds mills to towns and cities their many area's . 

  • jeffhre

    What is a coal factory? What does the administration have to do with it? What is the most recycled industrial item on the planet*? Where are electricity prices going way up? Define way up and take away the utilities that have applied for rate decreases and you will have to do some research before throwing out random opinions, however humble, next time IMO. 

    *What is the most recycled industrial item on the planet - automotive batteries.

  • Forrest North

    1. Coal isn't the cheapest form of energy anymore.  Gas is cheaper and scalable, hydro is cheaper (less scalable), wind is cheaper and pairs nicely with gas and hydro.  If anything cheap natural gas is going to be driving the cost of energy down.  At night when most EV's charge most of the time, electricity is at it's absolute cheapest and with the increasing addition of wind that night time energy cost will keep driving down.  The cheapest energy of all is efficiency programs, but I'm sure everyone knows that.
    2. If you pre-warm your car as all of the current pluggin cars allow than you won't see that much of a range decrease.  Pre-warming is a huge perk.  It's comfortable, it uses grid energy instead of battery energy so you extend you range, and it warms your batteries.
    3. There will be no piles of useless batteries.  After the battery is totally useless it will be recycled.  Cars are the most recycled consumer product on the planet.  They are so big that the economics of recycling work extremely well.  97% of Lead Acid car batteries are recycled according to several sources (http://batterycouncil.org/?pag....  Since pluggin cars have an even bigger and more valuable chunk of metal in them I expect the recycling rate would be similar or higher.  There are only tens of millions of cars produced per year (60m globally last year) so it will be awhile before we are making even a fraction of that with plugs, but I like the optimism of 100,000 million.

  • Neil

    Totally off base here on a number of points.  These are lithium ion batteries not lead acid batteries.  Lithium was an ingredient in 7-up years ago.  The other metals are typically phosphate or manganese (dirt) plus copper and aluminum.  There are also procedures in place to recycle batteries.  Yes, some are 460lbs - this makes it pretty tough to throw out with your landfill destined garbage.  These batteries are all brought back through the dealership network and sent to contracted recyclers.

    The great change with electric cars is that the means to generate the energy to move a car is independent of the storage and delivery.  We can generate electricity by burning coal, nuclear or renewables.  Right now that decision is not up to the US.  We use a global commodity oil, whose long term supply is controlled through OPEC.

  • Louis_A_King

    The question is misdirected. Electricity is not the answer given the battery problem. It's more likely that a generated power source will take the form of hydrogen which is then distributed to the end user.

  • jeffhre

    Using hydrogen eliminates the carbon and pollution of ICE's, and would likely be viable if any conceivable use of hydrogen generation was not 3 to 4 time as expensive as using electricity from conventional fossil fuels or from renweables.

  • Andrew Allison

    No, EVs will never become mainstream. Not only are they intrinsically more costly and have worse overall carbon footprin than hybrids and POIC (plain old internal combustion)  but their overall environmental footprint is disastrous (it's the batteries stupid)!

  • Maguire

    Where are you coming from?  Go to the EPA eGrid database and pull CO2, SOX and Nox emissions by power plant to see how much air pollution is generated per kWh.  Next look at the CARB data for autos and you will see that even if all of our electricity is generated from burning the dirtiest coal, you still have a much better environmental result than burning gasoline or diesel in vehicles even with the best emissions treatment.

    Gas when completely and purely burned creates 19.4 lbs of CO2 per gallon.  There is no way around that.  High school chemistry.

  • paladin911

    I have to go to Florida next week. If I were given a choice between an EV or a horse, I would take the horse. I would get there quicker.

  • Richard Lowenthal

    Not true.  My Volt has a top speed of 100 miles per hours.  That's one stinking fast horse.

  • searchingfor clues

    A couple of items regarding EV's that I never see mentioned:  #1 The cost to replace their batteries after a few years use is astronomical!  Their "resale" value after a few years would be a fraction of their upfront cost.  #2 If EV's somehow became mainstream, where would we get the power?  The current administration is shutting down coal plants, hasn't built any nuclear plants, and "clean energy" is cost prohibitive, less efficient and unreliable.     

  • Richard Lowenthal

    The shortest battery warranty in the industry is 8 years.  My 2 year old Chevy Volt has a bluebook value of $30K and I paid $34.5K for it.  That's better than most cars.

    The power comes from unused capacity while we're sleeping.