DOE Electric Car Report: 10 Things to Know

By · February 09, 2011

The Obama administration is holding fast to its goal of seeing one million plug-in vehicles on U.S. roads by 2015. A study published by Indiana University last week with input from the auto industry and academics, made headlines last week with the conclusion that Obama's goal is likely out of reach. Now the Department of Energy has released a status report detailing progress (and acknowledging challenges) for hitting the 2015 target. Here are the highlights:

1Eye on the Prize

The Department of Energy is sticking to its guns on a goal to bring battery costs down to $300 per kilowatt hour by 2015. The target, according to Tuesday's report, remains "aggressive but achievable."

2Getting on the Same Page

For the government, the term "EV" encompasses plug-in hybrids, extended-range electric, and all-electric vehicles. If it's a car that comes with a cord and a plug, it counts.

3Slow and Steady

"To reach the one million vehicle goal, EVs will need to average just under 1.7 percent of sales through 2015," according to the report, assuming sales of 12 million light-duty vehicles per year. That compares to an approximately 3 percent share of the market now held by hybrid vehicles, more than 10 years after their U.S. introduction. Nearly 2 million hybrids have been sold since December 1999.

Obama checks out the Chevy Volt.

Obama checks out the Chevy Volt.

4By the Numbers

Based on automaker announcements and media reports, the government estimates that the U.S. supply of electric vehicles will total more than 1.22 million from 2011 through 2015. This estimate includes an estimated 505,000 Chevy Volts, 300,000 Nissan LEAFs, 195,000 Fisker Nina PHEVs, 70,000 Ford Focus Electric cars, 57,000 Think City EVs, and 55,000 Tesla Model S sedans, among others.

5Living in the Moment (For Better or Worse)

The common consumer tendency to "assume that current fuel prices are good estimates of future prices" is a double-edged sword for electric vehicles. Most of the new-car-buying public discounts future fuel savings when comparing vehicle costs, the report notes. But during periods of high oil prices, buyers tend to place greater value on efficiency, helping EVs to overcome higher sticker prices and the perception of electric cars as a new, relatively unproven technology.

6Why Buy?

What might motivate a person to go electric? In the government's view, consumers consider cost first when buying a vehicle, but can also be drawn to EVs by factors such as quiet operation, good acceleration, "style and statements of personal identity," and "avoiding the gasoline refueling experience."

7Naming Names

General Motors, LG Chem, Envia Systems, Fisker Automotive, BYD, Coda Automotive, Honda, Mitsubishi, Toyota, Volkswagen, Volvo, Hyundai, Ford, Nissan, Smith Electric Vehicles, Tesla Motors, Think are all mentioned in the report, if only briefly in the section listing estimates for the U.S. supply of electric vehicles from 2011 through 2015. No nods for BMW, which plans to launch an electric city car in 2013, or Smart USA, which plans to expand its electric Smart Fortwo launch in 2012.

Obama checks out the Chevy Volt.

Obama learns about the Ford Focus Electric.

8 Open Questions

Tuesday's report acknowledges that "questions remain regarding the potential to reach the 2015 goal" of having one million electric vehicles on the road. For example, will production capacity be established? Will "technology, vehicle cost and infrastructure barriers" be reduced enough for "large-scale market introduction"?

9Time to Tout

The DOE report notes "unprecedented investment to build our domestic manufacturing capacity and secure our position as a global leader in advanced lithium-ion battery technology," including $2.4 billion in loans for EV factories in Tennessee, Delaware and California. Those loans were awarded through the Advanced Technology Vehicles Manufacturing program. Asked for an update on the ATVM program, which has announced only one conditional loan commitment since April 2010, and only two in the past year, however, DOE officials declined to comment in a call with reporters on Tuesday.

10Bigger Bucks on the Way

President Obama's budget proposal next week will include "significant" increases for battery and electric vehicle research, DOE assistant secretary for policy and international affairs David Sandalow said in Tuesday's call with reporters. He also reiterated a proposal for the $7,500 tax credit for plug-in vehicles to become available through dealers. The idea is to take a bite out of the purchase price at the point of sale, in a way similar to the Cash for Clunkers program in 2009.

New to EVs? Start here

  1. Seven Things To Know About Buying a Plug-In Car
    A few simple tips before you visit the dealership.
  2. Incentives for Plug-in Hybrids and Electric Cars
    Take advantage of credits and rebates to reduce EV costs.
  3. Buying Your First Home EV Charger
    You'll want a home charger. Here's how to buy the right one.