Special offer

“Who Killed the Electric Car?” - and why?

By
Real Estate Agent with COMPASS DRE# 01339266

With Oil prices reaching all-time record highs and gas prices rising on a daily basis, it's worth taking a look at whether anything happened over the last decade that may have averted our current dilemma. Two significant factors come to mind: (1) The continued transfer of oil to the Strategic Oil Reserves despite rising prices; and (2) The concerted effort to stop the benefits of technological developments. 

(1) In 2002 Senator Carl Levin directed the staff of the subcommittee on Investigations to consider whether the Department of Energy's program to fill the Strategic Petroleum Reserve was increasing the price of crude oil. In 2003 Senator Levin issued a Report concluding that the program to fill the Strategic Petroleum Reserve had in fact increased oil prices, but did not increase overall U.S. energy security.

The Report also concluded that the lack of regulation in the over-the-counter crude oil markets made those markets vulnerable to manipulation. He therefore urged the Department of Energy to suspend shipments of oil to the SPR when crude oil supplies are tight and prices are high.

The Department of energy ignored these warnings and this has hurt U.S. Consumers and Taxpayers.

(2) During the same period, the further development, marketing and production if the Electric Car was being stifled. This was ominously explained in the 2006 Documentary "Who Killed the Electric Car".  The film explores the birth, limited commercialization, and subsequent death of the battery electric vehicle in the United States, specifically the General Motors EV1 of the 1990s. According to the documentary, GM claimed there was no demand for this product and they then took back every single vehicle (which were only available on lease - none were actually purchased from GM). Despite many owners wanting to purchase their vehicles outright, GM would not respond to these drivesr, and at the end of the leases the vehicles were taken back and crushed. (Yes physically destroyed!)

(1) Why did the Department of Energy continue to transfer oil to the SPR despite the Report which concluded that the program to fill the Strategic Petroleum Reserve was increasing the price of crude oil while not increasing overall U.S. energy security?

(2) Why was the development and adoption of this new technology curtailed? Who was responsible? Was it Big Business in the form of the oil industry & car manufacturers, the U.S. Government, or consumers at large?

Comments(18)

Dennis Beckner
Beckner Mobile Notary - Rancho Santa Margarita, CA

Good questions. What I'm optimistic about is that some people are taking this into their own hands and dumping gallons of used grease from KFC into their converted cars. In Germany they're converting their cars to run on propane. There was a post the other day about Honda having an fuel alternative vehicle (I believe it was referred to as CMG-type fuel).

The car companies are starting to get it because consumers are starting to learn about alternatives. We call this upward influence. For too long consumers have accepted what we're offered as the limited choice. Now, however, car companies are starting to jump on the alternative fuel band wagon either because it's trendy or because they want to insert themselves into the market to capture those dollars from people who would convert their cars on their own.

May 30, 2008 08:33 AM
Sam Miller
RE/MAX Stars Realty - Howard, OH
Knox County Ohio Real Estate Specialist

In Knox County Ohio there are dozens of all electric cars driving the streets.  They are super quiet but most here are about as fast as a high speed golf cart.  They are great in town cars but most of the models I have seen strugle once they get over 40 mpg.  Very neat concept for sure and with some fine tuning they certainly have their place.

May 30, 2008 08:35 AM
Chris Prickett
DL Jones & Associates - Anthem, AZ

If there wasn't so much utter hysteria and ignorance regarding nuclear power, drilling in "protected" areas and refinery  development, gas would be a  buck a gallon.

Now, if you want to talk about developing alt-fuels, the solution is simple. Just offer a $50B prize to the company that creates a viable solution, and we'd be home free in five years! Capitalism at it's finest, baby!

May 30, 2008 08:37 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

Dennis - You're right. Manufacturers will have to respond to consumer demands in order to survive. Look at how Ford has been forced to cut production of its pickups and large sport utility vehicles. Sales have plummeted due to high gas prices.

Sam - When it was launched, General Motors claimed their EV1 was "designed to go 0 to 60 mph in less than 9 seconds and to cruise almost effortlessly down the highway."

Chris - It was reported that GM spent over $1 Billion on the EV1 project, and they never sold a single car. They only were available for lease. It seems that from a profit point of view, the $1 Billion was a smaller loss to swallow than the alternative.

May 30, 2008 09:14 AM
Joyce Bradley
Century21 Select Group - Lake Harmony, PA

I wonder why the $1B loss was smaller than the alternative!  Is it because the vehicle is not economical to produce? Or is it hard to go long distances without access to recharging facilities when needed? Or is it both of these plus others?  The market place has always determined what was available and what ws not - at least in the free captilistic countries of the world.  When the economics are right the products will be there and  be viable and probably not one minute before.

May 30, 2008 09:40 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

Joyce - I'm not big into conspiracy theories, but in this particular case I suspect that General Motors had pressure from the oil companies.

GM claimed that the project was not financially viable. Each EV1 had a List Price of around $40,000, but cost $80,000 to develop and manufacture. Obviously the more cars they made, the lower the per unit costs would have been due to economies of scale, but GM also claimed that there was not a market for their product.

I'm curious if anyone saw the commercials or promotion of this car? Why were these cars crushed? Why wouldn't GM allow the drivers to own the cars?

May 30, 2008 09:59 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

UPDATE - This is an interesting site about the new breed of electric cars (Tesla Motors). Hardly affordable for everyone, but interesting technology!

Jun 29, 2008 02:49 AM
Cowboy Gonzalez
Keller Williams - Norco - Norco, CA
This Cowboy rides the extra mile.

GREED killed the electric car.

Oil is supplying tons of $$$$$$$$$$$$$$$$  to the ones in control, and they have more money to fight it.

Aug 03, 2008 02:53 PM
The Bartley Group SouthEast MN Real Estate
Coldwell Banker Home Connection - Owatonna, MN

I watched that movie and I was astonished.  Now how much of it was actually true I'm not sure, but I would be one of the first to stand in line for a reasobably priced electric car.  Most of our driving is in town oly so the top speed is not that important.

Brian Bartley

Aug 05, 2008 07:34 AM
Pete Jalbert
The Maui Real Estate Team, Inc. - Paia, HI
R(S)

I have Who killed the electric car on the Netflix que. I am looking forward to seeing the movie.I want to see the movie before formulating an opinion on the original demise of the electric car, but honestly it would not surprise me.  I think oil companies have played a role in curtailing alternate energy development and conservation efforts. They lobied against higher fuel efficiency standards.

It doesn't help that prior to the recent explosion in the price of oils, that the biggest gas hogs were Detroit's most profitable vehicles. Now, American Auto manufacturers have been caught flat footed and will struggle survival as they see their most profitable vehicle sales plummet and they don't have enough inventory or products to meet the demand for hybrids and more fuel efficient vehicles.

 

Aug 21, 2008 07:35 PM
Sabrina Kelley
ERA Herman Group Real Estate - Woodland Park, CO
Woodland Park Colorado Mountain Homes and Land

I didn't know the phrase was a movie out all. I will have to pull a copy myself.

 

 

Aug 21, 2008 07:52 PM
Terry Haugen STAGE it RIGHT! 321-956-2495
Stage it Right! - Melbourne, FL

Stewart, the electric car is NOT dead.  As Sam, above said " there are dozens of electric cars" driving the streets all over town.  I have one as well.  The unfortunate part of the promotion of electric vehicles is that the auto manufacturers are focusing on SPEED, thus have not been able to make one that fits their specs.  HOWEVER, how many people drive within 20 miles of their home, on side streets, or city streets with limited lower speed limits?  I'd say, probably 90%.  That said, the vehicles on the road today are more than adequate for everyday driving.  Mine happens to go only 35 mph with a 35 mile range.  But I can go everywhere I need to go, for the most part, and get back home with battery left to spare.  I we would just take the baby steps needed to get to the all important SPEED mandate the auto industry has placed upon itself, we could have thousands of electric vehicles on the streets while waiting for them to receive their bailout money and pay  us more lip service.  My car is manufactured by Zenn Motor Co. in Canada.  Its a two seater with plenty of cargo space in the back, roll back sun roof, and A/C.  The cost is around 18k, much less than the "purported" Chevy Volt, which won't be ready for at least a year, if ever, and will cost over 40k.  Also look for the "compressed air" car, manufactured in India by Tata Motors for a French company, due out next year.

Nov 16, 2008 01:27 PM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

Now the three major auto maunfacturers want a Government bailout because they're in dire financial trouble. Why didn't they invest in research and development whn they were selling huge SUV's?

I think the oil companies must have influenced them to keep building gas driven cars and ignore other forms of power.

How short-sighted were these people?

Nov 16, 2008 01:47 PM
Pete Jalbert
The Maui Real Estate Team, Inc. - Paia, HI
R(S)

If there is to be a bailout, it needs to come with agreements on higher fuel standards and a comprehensive plan to overhaul the auto industry.

Nov 17, 2008 10:00 AM
Pete Rondello Sr
Coldwell Banker Mulleady Inc. - Boulder Junction, WI

Stewart: One of the most thought-provoking movies I have seen. Got it at my library last year and watched it with my family.

Hopefully, the ride is over for big oil. You can see it in the now lower prices that the gig is up, and the upper administration isn't going to be pals with them as before.

I am ready for an alternative energy car. I will pay a premium price for good engineering. The Prius and Civic hybrids are a start. I'm waiting for the Chevy Volt. GM needs a SURGE to get it's sale back on the road again.

Good topic; thanks.

Nov 17, 2008 11:39 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

Pete - GM had the technology over 8 years ago, but failed to develop it fully.

Shouldn't GM be held responsible in some way?

Dec 06, 2008 08:26 AM
Chris Glahn
Keller Williams Realty - Ann Arbor, MI

that is a  excellent documentary  and it makes you wonder who is in charge?

Dec 13, 2008 07:57 AM
COMPASS PALM SPRINGS | Stewart Penn
COMPASS - Palm Springs, CA
COMPASS Palm Springs - Broker Associate

March 29, 2009 - Rick Wagoner resigned as Chairman and CEO at General Motors at the request of the White House.

Wagoner's tenure as CEO of General Motors occurred during a recession where the market capitalization (share price) of GM has gone down by more than 90% (Wikipedia).

Mar 30, 2009 07:14 AM