Shai Agassi = Steve Jobs (good news / bad news)

jdh2550_1's picture

A friend of mine lent me his copy of The Economist which has an article on Shai Agassi or Project Better Place. It's a great article and in the opening blurb it makes a great (but brief) comparison between Agassi and Jobs. That comparison is one that I think will play out in more than one way – I think Better Place may become the Apple of the EV world – they may very well end up with a well designed and workable CLOSED system. And, just like Apple is never more than a niche player in the personal computing product space Better Place will never be more than a niche in the EV world. But that’s OK – Agassi will still have realized his goal and made the world a better place.

However, I think the illustrious Mr Agassi is dead wrong when it comes to the two "inherent drawbacks" that the article reports Agassi thinks "will not vanish soon" which are battery limitations and high-speed charging:

First batteries.
a. Battery prices are falling already.
b. LiFePO4 is currently the best chemistry for automotive use – it’s widely seen as “good enough” (i.e. you can build an affordable 100 mph / 100 mile range car around a LiFePO4 pack).
c. There are two major classes of manufacturers of LiFePO4:
i. "High-end / high-tech / high-expense" – the likes of Valence and A123 fall into this category. They have specialized processes that eek the most out of LiFePO4
ii. "Low-end / low-expense" – I guess Agassi doesn’t like the Chinese. There are numerous Chinese manufacturers that make "adequate" LiFePO4 batteries. Not as good as the high-end – but they are good enough.
d. The price for the low-end continues to fall. A couple of years ago it was about $3 per Ah. Today, at wholesale rates, I can buy FOB China for much less than that. If I can buy in my quantity at my "good price" I’m sure Agassi could buy for a good 20% less than me.
e. The price of the raw materials is cheap and the materials are abundant. This is an important one! Lead and Nickle are expensive and getting more so. The price of these metals appear to be a key driver in the price of the associated batteries. However, Lithium and Iron are cheap and don’t appear to be a main driver in the price. Thus, as demand grows supply can grow fast and prices can be driven down further.
f. Of course there are also lots of people working on building the better battery. EVs are energy storage agnostic. When the batteries (or energy storage device) get better then the cars will improve – be that range or cost.

Next high-speed charging.
a. Duh! This one is really either just plain salesmanship BS or he’s not very smart… (I know which one I believe)
b. If you can have a network of battery change stations with an investment in expensive batteries then you can have a quick charge network with an investment in less expensive batteries to store the power to charge the cars. You transfer the power from the storage batteries into the car batteries – you don’t transfer it from the grid (well, at least not at speed – the storage batteries will be recharged in the same way as however he plans to keep the auto batteries charged and ready for swapping).
c. Battery swapping is a classic case of clever engineers designing a solution for a problem that doesn’t exist!
d. We do need common forms of charging – but that is already being addressed by folks like IEEE working on a standard charge port.
e. Why is a fast-charge station better than a battery swap station:
i. You only need to make the plug common not the pack. This allows engineers much more latitude when designing a vehicle
ii. To create a charge-station you only need to invest in "energy storage batteries" and then can service any vehicle with a standard charge port (Agassi’s cars are likely to have that standard port)
iii. "Energy Storage Batteries" (ESB) for the charge-station can be optimized for use in a stationary setup which is a far easier environment to engineer for than for automotive use. Thus the ESB should be cheaper per kWh than an automobile’s pack.
f. Why is battery-swapping better than fast-charging:
i. It has the “gee whizz” capability of a really fast charge without leaving your car. We probably can’t get a 40 second recharge (and they can swap batteries in 40 seconds). But I can do a 20 minute fast charge today and there are 10 minute solutions out there now (currently in the high-end world) and 5 minute solutions around the corner (check out MIT for some of the latest in battery developments). As for not getting out of the car – I’m sure it must be easier to design an automatic plug in mechanism than an automatic battery changing mechanism.
ii. ??? I really can't think of another reason why battery swapping is better than fast charging

What is the real value of a 40 second battery change while sitting in your car? It’s nice, it’s convenient – but is it worth saddling the EV industry with a vision that this is a MUST DO?

So, I have a real love-hate feeling towards Agassi:

1) I love the fact that we’ve got someone as capable as him making EV stuff happen

2) I hate the fact that his base assumptions are wrong and he’s so committed to a path that he seems reluctant to change (so instead he will continue to perpetuate the myth that the battery price and the charge time are big nasty roadblocks and that he has the only solution)

And the thing that makes my blood boil is when he’s arrogant enough to assign all arguments against his particular vision to those "with vested interest in cars powered by fossil fuels". What an arrogant SOB! (Just like Jobs can be too!)

At the end of the day you need the superstars like Jobs and Agassi – but along with their brilliance come their flaws.

Ho hum...

before comments

Comments

reikiman's picture

Excellent..

Main thing I want to add is a reference to this video of a presentation he made at MIT last winter.

http://visforvoltage.org/forum/6344-questions-about-project-better-place039s-battery-swap-business-model

In the video me makes a claim that China isn't about to sell batteries (??in significant quantities??) to anybody outside China but instead that the plan is that they will sell complete vehicles. What is your take on that?

e.g. there are several LiFePO4 makers in China but it seems difficult to get their batteries here. The size of some of the factories indicates large production potential and how could they afford large factories if they're not making sales.

they may very well end up with a well designed and workable CLOSED system.

Apple makes very pretty walled gardens.

Mik's picture

I saw a presentation about the better place system and read a few things.

It appears to me that it has many characteristics of a cult.

Their guru is portrayed as the savior with the enlightened ideas, and it all rides on his charisma.

That does not have to be all bad, of course:

Even if you don't want to bounce around wearing orange, chanting the Hare Krishna Maha Mantra continuously for the rest of your life, you might acknowledge great value in the results:

Food for Life
Main article: Food for Life

ISKCON has inspired, and sometimes sponsored, a project called Food for Life. The goal of the project is to "liberally distribute pure vegetarian meals (prasadam) throughout the world", as inspired by Prabhupada's instruction, given to his disciples in 1974, "No one within ten miles of a temple should go hungry . . . I want you to immediately begin serving food".[30] A global charity, directed by Paul Turner and Mukunda Goswami,[31] coordinates the project. Food for Life is currently active in over sixty countries and serves over 700,000 meals every day.[31] Its welfare achievements have been noted by a number of journals worldwide.[32][33][34][35]

http://en.wikipedia.org/wiki/International_Society_for_Krishna_Consciousness

This information may be used entirely at your own risk.

There is always a way if there is no other way!

jdh2550_1's picture

Excellent..

Main thing I want to add is a reference to this video of a presentation he made at MIT last winter.

http://visforvoltage.org/forum/6344-questions-about-project-better-place039s-battery-swap-business-model

In the video me makes a claim that China isn't about to sell batteries (??in significant quantities??) to anybody outside China but instead that the plan is that they will sell complete vehicles. What is your take on that?

e.g. there are several LiFePO4 makers in China but it seems difficult to get their batteries here. The size of some of the factories indicates large production potential and how could they afford large factories if they're not making sales.

It would be nice if he could back up that claim. There are several folks using lithium batteries outside of China. There are also lower cost producers in Taiwan. I haven't watched the video - does he provide reasoning for the statement? It seems to fly in the face of reality.

they may very well end up with a well designed and workable CLOSED system.

Apple makes very pretty walled gardens.

Yup - I agree (and I thought you'd warm to that part of the post ;-) ). It's almost always easier to create and maintain a higher quality for a closed system - but they never thrive as well in the long term as an equivalent open system. There are lots of examples of that out there - and given Agassi's background (high flyer in SAP big German software company) you'd think he'd be able to grasp that concept.

Unfortunately he's committed to an expensive path now and he's going to follow it no matter what! (a bit like Vectrix and NiMH - but don't tell Mik I said that!)

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

jdh2550_1's picture

It appears to me that it has many characteristics of a cult.

Their guru is portrayed as the savior with the enlightened ideas, and it all rides on his charisma.

Again, that's a bit like watching the keynote for an Apple Developers Conference.

My worry is that Agassi will fail and create bad will which in turn affects the whole EV industry. Unless the reason he fails because Current Motor Company beats him. Yeah, OK, in my dreams! However, if he succeeds it's not all bad.

Here's my predictions:

1) They manage to get about 50% of the battery-switching stations in place but it practically bankrupts them to do so
2) They try charging the customer too much for these "leases per kilometer" to recover their costs. They give up and introduce a "buy your own fuel plan" claiming it's some sort of revolutionary idea.
3) Folks who have the Nissan-Renault EVs start charging them at fast charging stations
4) Agassi is forced out of PBP and tries to make the battery changing work with his own company. It fails.
5) PBP lurches to the edge of obscurity and CuMoCo offers to buy them
6) Agassi re-invents himself and starts a highly successful movie studio
7) Agassi comes back to PBP and they start making portable music players and cell phones

OK, maybe not 4, 5, 6 & 7 - but you get the idea!

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

reikiman's picture

There's a point which may be obvious.. but.. here goes anyway.

A hundred years or so ago there was a Taxi company in NYC whose taxi's were electric vehicles. They had quick change battery stations all over NYC so that the taxi could just pull in, and after a couple minute the battery would be swapped and away the taxi would go. This is one model where a quick change battery system makes a lot of sense. General form is some kind of work vehicle, e.g. delivery van, taxicab, etc. The ROI for a work vehicle is keeping it on the road full time, and a quick change battery pack would do so.

A consumer car spends 80-90% of its time parked. Hence if the pack is big enough to handle normal around town driving with one recharge per day then it probably does not need quick change battery packs. In fact Shai said so in the video I linked in the other posting. He described needing the battery exchange stations at strategic places to support long range trips. e.g. the SF Bay Area is a transportation island due to the mountains and the limited highways in-/out- of the area. Hence a battery exchange station in South San Jose, another in Los Gatos, another in Pleasanton, another in Martinez, and another in Marin County, those would cover travelers taking long trips outside the bay area.

Maybe a flaw in his plan is focusing on consumer cars when it's the various work vehicles (around town delivery trucks etc) who might gain the most benefit from battery exchange.

FWIW the Zero Motorcycles system proves quick battery exchange doesn't require a complex roboticized system.

jdh2550_1's picture

I don't think the Zero Motorcycle swap proves much of anything - it's too small and too limited to really compare.

I've watched the video and about half the questions - here are some observations (not very coherent yet):

- it's all about the business model - as far as I can tell I think he says he needs to own the batteries to make things work
- it focuses on the short term view of a $35K car+battery with 2 cent per mile operating costs vs. a $20K car and purchasing miles at 12 cents per mile (or whatever the cost they charge is). The average consumer will go for $20K.
- the economics works because he compares his model to the price of gas. He actually comes right out and answers one question with the statement that he's charging the equivalent of a 25 cent per kWh premium over the price of electricity. He states he can only do that because he's replacing oil - not because he's competing with electricity generation companies.
- OK, so that's fine in a vacuum. However, what happens if his battery pack costs $15K because it's engineered for swapping but it's only $10K when engineered to be rarely replaced (say once per 100K)? Now it's $30K plus $240 fuel cost vs. $20K plus $1440 fuel cost per year. It's getting closer. I'm also not sure I like his numbers - Detroit Electric are shooting for a $25K 4 door sedan with 100 miles & 100 mph. Sounds achievable to me.
- He makes some vague references to "free cars" and "rebate checks" but unless someone asks in the questions section there were no specifics.

He's very persuasive and his model is very interesting. However, I think you can solve the problem without battery swapping and without creating another monopoly. Interestingly he likes to point out that oil is the "only monopoly we haven't broken" - but isn't he creating a monopoly with his closed system? Of course Mr. Agassi might be a benevolent dictator - but what about the next guy.

He almost has me believing that he has all the answers but there's still a few pesky details that I feel like he's glossing over.

One interesting thing is that he expects to charge his batteries in 30 minutes - so he states he will keep 10 batteries per charging station. 3 minutes to service per car so the 11th car gets serviced by the 1st cars battery.

HANG ON A SECOND.

That still means you've got the potential to have 10 batteries all moderately-fast charging in parallel. Isn't the aggregate the same as fast charging them in series?

So won't you still need some form of buffer (an ESB) as well as 10 batteries per station? Most gas stations have at least 8 pumps.

Again - this post is all a little scattered - got to collect my thoughts. But I still smell a rat - something akin to when Jobs' claims that Microsoft stole the GUI from Apple when they both stole it from Xerox.

But he almost had me.

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

jdh2550_1's picture

My head hurts! I just spent too much time trying to figure out some cost numbers based on Agassi's presentation that David links to above...

You can see the gory detail here: http://www.editgrid.com/user/jdh2550/PBP

Some interesting points when you dig into things.

1) By my calculations you could make a 25kWh "non-swappable" pack installed with a BMS and in the volumes Agassi projects for about $9000 - probably less.
2) Agassi uses two different numbers for his swappable pack price $15K when talking about car+battery for $35K or car only for $20K and then he uses $12K when answering one of the questions on his economics. So, is that $3K for profit?
3) Using the $15K figure and a snippet where he talks about charging a 25cent per kWh premium over the regular electric cost my guesstimate is somewhere around 11 cents per mile
4) A well managed LiFePO4 pack discharged to 80% has a 200,000 mile life. Thus, I don't think one has to account for battery cost in the comparison calculation (on average folks change cars every 3 to 5 years and 200,000 miles is 16 to 20 years life)
5) Thus the mileage cost per year for my non swappable pack is $320 per year based on 12,000 miles
6) Agassi's mileage cost per year with his swappable pack is $1380 per year
7) Using European gas prices of $7 per gallon gives the swappable pack a healthy 61MPG equivalent
8) However, the non swappable pack weighs in at 262.5MPG
9) If you go to US gas prices of $3 per gallon and the swappable pack is down to 26MPG and the non-swappable pack weighs in at 112.5MPG

OK - so you might say I'm not being fair:
- You might say I've overstated Project Better Place's mileage charge. Can someone point me at what PBP is going to charge? I see 7 cents on the net but I don't see it from Agassi nor on betterplace.com - sounds suspect to me because 7 cents per mile doesn't even cover the cost of the battery (which Agassi makes clear is a part of the pricing model).
- You might say I really should include a 4.5 cent per mile battery pack cost for the non-swappable pack. I'm not so sure I should. Also the model starts to get really complex if you want to do that because then I want to factor in further falling costs of batteries - it's the replacement cost that you have to account for not the sunk cost of what you paid for it. But Agassi's model is a fixed price per mile (another explicit statement that he makes).

I also don't think Agassi is being particularly fair with his base car cost of $20K. I think there's padding in there to make his numbers work better. He has a car + battery price of $35K however Detroit Electric (headed by an ex-CEO of Lotus Engineering) is targeting the same basic specs for $25K.

Agassi's "buy the miles not the batteries" isn't terrible - I think it still takes you about 5 years to make up the difference of just buying your own battery and paying for the electricity rather than Agassi's buying miles approach. Furthermore it doesn't take into account the rebates and other things he says will be coming which could result in "free cars". However, we don't have any details on that yet.

Of course all my calculations could be dead wrong! The economics might work much better - but I'd really like to find out the PBP mileage plan costs.

Again, to compare to Apple - it's not like they're bad products or that they're ridiculously expensive. It's just that closed systems stifle competition and keep prices higher than they might otherwise be. Good for Jobs' or Agassi's profit - at the added expense for the consumer. Some consumers will say the cost is worth it and buy an Apple, others will say "no thanks" and buy a non-Apple alternative.

OK - enough for now. But I do still want to look at the numbers surrounding charging stations and energy consumption. I think there are some interesting data points in there as well...

I really should "get a life"...

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

Honestly, I think trying to build long-range all-electric vehicles is premature right now.

I see two simple choices that will serve our needs for another 10 years:

1) Two vehicles. I have a diesel car for long trips, and an all electric scooter for local/daily travel. Most households only need some sort of short range electric, and could easily just rent a liquid-fuel vehicle for long distance travel. The long-range vehicle should be as efficient as possible, but optimized towards long trips, which means it doesn't require a large all-electric range. An electric scooter is a good choice for a second vehicle, since it's significantly less expensive than a car, and is much more efficient for most needs than a larger and heavier car.

2) Range-extended electric. This is an electric vehicle that carries an onboard liquid-fueled generator, like the Chevy Volt. You get a reasonable plug-in electric range for daily driving, but the vehicle has a conventional liquid-fuel engine that provides power on long trips. If you have to have a single vehicle that does it all, this is probably the design to target for the next few years.

This is what I see being needed for the next 10-15 years. After that, battery and/or ultracapacitor technology may produce all-electric vehicles that can do both local and distance travel without long recharging delays.

Another possibility is that liquid fuels will never disappear entirely, since they allow the transfer of a huge amount of energy in a very short time. However, they liquid fuels will be synthesized via chemical processes using renewable energy, rather than being pumped out of the ground. Ethanol and Biodiesel are the very beginnings of this trend, but there is room for improvement on both the production and consumption sides.

My electric vehicle: CuMoCo C130 scooter.

jdh2550_1's picture

Honestly, I think trying to build long-range all-electric vehicles is premature right now.

I see two simple choices that will serve our needs for another 10 years:

1) Two vehicles. ...

2) Range-extended electric. ...

I agree 110% - I'm just trying to take a little more in-depth look at Agassi's numbers. It's a disease I have - if someone gives a hand-waving, big-picture type of presentation with claims of a wonderful future but only if you do it their way I get suspicious. And when I get suspicious I like to try and counter with facts (or at least clearly stated assumptions) rather than resorting to my own hand-waving. I detest BS and FUD.

I would LOVE to sit down with Agassi over a beer (or other beverage of his choice!) and have an honest debate over this. He's an incredibly smart guy and a gifted entrepreneur and visionary (anyone who can sign up Israel, Denmark, Australia and Hawaii to significantly support and adopt his program is not your average "crackpot"!) Is he unaware? Or does he REALLY have solutions to the naysayers concerns? Or is he aware but knows he can make a lot of money in the meantime? Or that failure is OK because he pushed folks closer to a solution? In other words WTF is he thinking when he stands up there and waves his hands and talks great big grandiose plans?

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

Hmmmm. is Shah Agassi and his Better Place just a well conceived confidence trick, or are they caught up in a self deluded cult of personality(some pretty impressive personalities I'll grant you!).

In my humble opinion, it's a bit of both. Sooner or later in any major emerging industry or advance in the way the technology of mass production changes to the way we live there are always the Utopian's. These seer's and their followers can be found during any major advance. Distinguished by smug self-righteous conviction and impractical science, they evangelize a vision with very much the same methods as the quasi-science based creeds of the 19th century. the descendant's can be found in every science, out on the fringes, emerging during times,of economic upheaval, only to retreat into obscurity again. Like their Hippy ancestors, the fringe dwellers are convinced of apocalyptic dreams where they will emerge as the righteous heroes!

I'm afraid Shah Agassi falls into the same category as other men who having been luckily successful in one field are now convinced they can solve any problem in the world. King Gillette, Preston Tucker, Delorean,etc,etc... the list goes on and on. On thing they all had in common was they were convinced that the vison was correct if only they could ignore or brush away, those irritating flaws in the grand plan! Along the way they convinced well meaning politicians, ardent supporters and very charismatic people to sell a concept flawed from the beginning. In fact the more flawed, why the more faith that is required from the faithful!
A Better Place, isn't a business, it's a cult! Sadly, Better Place will achieve nothing more practical, than the ardent supporters of "miracle fuel additives" and the con men who prey on them! The only thing that will happen is a huge amount of investment will be wasted and diverted from worthwhile EV development.
In my own experience with Better Place, it would appear that any serious forensic questioning is met with, half truths, evasive explanations, or "the software will deal with that" ! (wow, some software!)

An example of this is the claim, now so widely accepted that, Better place has signed up several countries. But has anyone actually examined this claim and what it really means? It is now so widely accepted, that it is virtually impossible to explain how silly this statement is, and people simply don't want to listen to a factual, rational, explanation debunking this blatant lie, instead preferring to accept the , 30 second, headline grab, skillfully orchestrated PR engineered propaganda from Better Place media machine.

If this sort of nonsense was advanced by an oil company,or auto-manufacturer, it would be exposed for the useless propaganda that it is, but because Shah Agassi and his followers say the tings we want to hear, we suspend our normal analytical cynicism. The kindest prognosis for A Better place will to be consigned to the scrap heap of redundant technology, along with John Logie Baird's Mechanical TV, Eight Track stereo, hydrogen fuel cells,etc..Oh, and a marvelous project in blind determination over commonsense, that MIK should know from his Australian homeland, "Big Lizzie".

Please excuse the above rant, but any serious organization that defends a deeplyflawed business plan with the nonsense that China will not mass manufacture lithium based batteries for export, for some mysterious reason, thereby denying the world cheap and improved batteries, is just plain silly! Do better place imagine that they are addressing ignorant sheep? I'll bet the Taiwanese would be delighted to leap at the opportunity to supply the market, or any one of 50 other aspiring nations.

for those of you who have not had the privilige of visisting Australia

marcopolo

Mik's picture

....
Oh, and a marvelous project in blind determination over commonsense, that MIK should know from his Australian homeland, "Big Lizzie".

Here is a link to Big Lizzie: http://home.vicnet.net.au/~rcdhsoc/lizzy.html

http://www.ebroadcast.com.au/ecars/ClassicTrucks/PiCs37/BigLizzie.jpg

This information may be used entirely at your own risk.

There is always a way if there is no other way!

Thank you Mik for the link,

A really amazing piece of engineering! Just imagine those guy's building that enormous behemoth and trundling for two whole years across the wilderness, completely ignoring the two developments that would ensure that the whole effort was completely futile. The first was that no bridge existed across the Murry river that would carry Big Lizzie's weight, and secondly,even before They started the epic journey the Railroad was being built along side their route! Great stuff! I just love it !! Sort of a real life, Pythonesque, "Ripping Yarn"!

marcopolo

jdh2550_1's picture

Hi Marcopolo,

Thanks for the posts. I'm curious - what's your professional background?

I enjoyed your rant - and it made me realize that I might actually be being too kind on Agassi. Although I think it's more likely a case of a combination of group think and "dilution of reasoning" (those that add their voices to Agassi's "vision" are less and less critical as the momentum builds and they're further and further away from the source to be able to debate and get answers). I don't think it's snake-oil - I think their hearts are in the right place - just not their minds.

However, one thing Agassi is doing is giving the public what they want - "unlimited range". For all our stats and studies that say unlimited range isn't necessary there's still an apparently impassable hurdle for the consumer to get past to agree and buy a limited range EV. One of the reasons I believe scooters make the best market sense for EV's is because we can compete head to head on everything and range doesn't matter nearly as much (although it still pays to have "good range" - whatever that is!)

Marcopolo - now you've told us what Agassi is doing wrong - what is he doing right? I'd love to hear your point of view on that as well.

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

reikiman's picture

However, one thing Agassi is doing is giving the public what they want - "unlimited range". For all our stats and studies that say unlimited range isn't necessary there's still an apparently impassable hurdle for the consumer to get past to agree and buy a limited range EV. One of the reasons I believe scooters make the best market sense for EV's is because we can compete head to head on everything and range doesn't matter nearly as much (although it still pays to have "good range" - whatever that is!)

The technical name for this is Habituation. The habit-habituation in everybody's mind is decades of cultural experience with vehicles that have effectively unlimited range.

My background is principally in investment banking, venture capital risk, feasibility studies , due diligence, market positioning etc.., but my professional qualifications are Law/Behavioural Science.

What does Shah Aggasi do right? Well he is very professional about marketing his ideas to the general public and politicians. As long as you don't examine or test the beginning of his assumptions the rest of his sales pitch seems plausible and well intentioned. It is his treatment of dissenting views that gives the whole hoopla away, basically he is very driven to be another Steve Jobs. The main difference between him and his idol, is Jobs really does develop feasible products.

The problems facing mass/volume consumer acceptance of EV's are, speed, range and price. Realise that it may seem ridiculous that in countries where speed limits are rigorously enforced at around 70MPH or 130 Klm.s, consumers still can purchase ICE vehicles capable of travelling 3 times that speed. But hey, lets be honest, which of us would reuse delivery of the latest Ferrari? Well yeah, I know there are those 'save the earth, sandal wearing, puritans who ride bicycles and dream of every one being forced to use public transport and knit their own yogurt, but they really don't spend enough to sustain a consumer society capable of mass manufacture. I recently attended a conference where a large part of those worthies attended as well as a mixture of engineers and EV supporters. When a consensus had been reached that the "authorities' should be admonished for not doing enough to encourage EV development, I asked if any of those assembled actually owned an EV or at least travelled to the conference in one. Yeah, NOT one of the 180 attendees actually owned an EV let alone a Vectrix, which for all its faults is the closest you can get to a mass-production, freeway legal EV. The problem is, outside of the specialist commercial area, EV's are not supported by even their own fan base. (well not in sufficient numbers).

Now don't get me wrong, I believe that the EV will eventually prove to be the only viable successor to the ICE, but only when it can approximate the same market appeal. Shah Agassi is right on the money in his marketing pitch when he exclaims that no one is going to radically change their entire life-style when purchasing a new car/vehicle. Yes,i know what the advertising brochure says, and really do hope that your new "freedom machine' will change you from being a middle aged accountant,still living with your mum, into the next James Bond, But it might be cheaper just to get rid of the comb-over and cardigan!

Shah Aggasi appeals to a future we all would love to see. Me? I'd just love to have been a passenger on one of the great airships in the 30's. The sad reality is that only practical and convenient appliances survive in the market place.

The answer to EV development is better battery technology or ultra-capacitor/whatever development. This is the holy grail of EV acceptance.

marcopolo

reikiman's picture

basically he is very driven to be another Steve Jobs.

Interesting take. That may be endemic of Silicon Valley (where I live) in that Steve Jobs is a bit of a rock star. My former employer, Sun, has it's own S.J. wannabe in Jonathan Schwartz, and you can see where that got Sun.

sustain a consumer society capable of mass manufacture.

Hurm,... I don't wear sandals but I really think a huge part of the problem in our society is the "modern consumer society" (as you put it). Go watch The Story of Stuff for a brilliantly put description of how I feel about this. Consumption for consumption's sake is unsustainable and contributory to global warming etc.

It does appall me the number of people anxious about these issues but who can't be bothered to do much about it on their own.

but only when it can approximate the same market appeal.

As a practical matter I agree with you, but it makes me sad.

I'd just love to have been a passenger on one of the great airships in the 30's.

In Silicon Valley we have some kinda tourist oriented company that's flying those very sort of Great Airships on trips around the area. They take off from Moffett Field where there are still dirigible hangers left over from the 30's and the Navy had dirigibles they used for coastal defense work. The things fly over my house regularly. Way cool but expensive.

Well now, perhaps the sandals were a bit over the top! I wanted to highlight the impotence of well meaning philosophy against practical reality when it comes to mass marketing any product.

I wholeheartedly agree with the problems of consumerism for consumerisms sake! Aye, but therein lyes the rub! We are venturing into the realm of opinion and like art, one mans treasure is another rubbish! You and I may say the the late night, TV home shopping special product, a Dial-a-tic, handy-dandy, sponge sharpener, (now available in 14 different colours!) is an absolutely disgraceful waste of the planets dwindling resources, but the inventor, manufacturer, those who depend on the success of the product to sustain employment, families and incomes, may recent the sanctimony of those who profess adherence to democratic choice but actually practise sanctimonious hypocrisy.

The solution is not to pass more self-righteous laws, but to encourage investment for awareness within our existing capitalist system. For Despite its shortcomings, it is the only real system available. Waiting smugly around dreaming of a new utopia will only make EV adherents irrelevant. EV development needs capital from investors who expect a return on profit in the form of dividends and capital growth. It will be the Toyota's and Ford's who will eventually manufacture and market successful EV's. This is evidenced by the success of the Ford backed Smith-Newton EV truck range.

You are indeed fortunate to live near the Dirigible bases in California. I am only really familiar with Blimps, (Goodyear style)but Wow, imagine travelling from Berlin to Rio in the Graff Zeppelin! Of course had the USA allowed the export of helium, the journey would have proved less dangerous!

Who knows, the age of the airship may return, harnessing atmospheric energy to power electric engines !!

marcopolo

jdh2550_1's picture

My background is principally in investment banking, venture capital risk, feasibility studies , due diligence, market positioning etc.., but my professional qualifications are Law/Behavioural Science.

Interesting - and I can see why you're likely good at your job! :-) I really do enjoy your insight. BTW, I'm not stalking you - but are you in the UK or the US? As an entrepreneur with a start-up I just watched a presentation on VC funding in the US. And it managed to illuminate a missing part of the puzzle for me: basically VC's NEED to invest large sums - so unless CuMoCo tries to go BIG we're likely not going to be of interest to VC funding. We weren't necessarily looking for VC at this stage (but we are looking for the right angel investor) - but it helped me to realize that unless we want forty million or so in the next three years or so with a possible 5x to 10x return within seven to ten years we shouldn't really bother applying for VC. That's likely not strictly true but it was an eye opener about the "swing for the fences" strategy and average deal size stats.

What does Shah Aggasi do right? Well he is very professional about marketing his ideas to the general public and politicians. As long as you don't examine or test the beginning of his assumptions the rest of his sales pitch seems plausible and well intentioned. It is his treatment of dissenting views that gives the whole hoopla away, basically he is very driven to be another Steve Jobs. The main difference between him and his idol, is Jobs really does develop feasible products.

I think you sell Aggasi's plan short. There is some good stuff in there with regard to intelligent management of the EV infrastructure - I know you've said you're not a technical guy but you should check out some of their software ideas (but I wholeheartedly agree with you that the folks that imply that the software can "fix" problems with the model are likely smoking something). However, don't throw the baby out with the bathwater.

I also think you're a little too kind with Jobs and Apple. Remember NeXT? That (and the run up to Apple firing him) seems to me like Jobs' main egotistical phase (perhaps what Agassi is currently suffering?). Jobs' seems to have gotten past it though - and is back to focusing on making money rather than making markets. As far as "feasible products" go - you're right. Apple develops merely OK products with FANTASTIC industrial design and FANTASTIC marketing for which they manage to demand a PREMIUM price. They're the Nike of the consumer electronics world. There are lots of better products out there. However, just like the Better Place crowd if you try for an objective look at an Apple product vs. others you get the usual zealotry that obfuscates the drawbacks of the Apple product. Folks buy Apple because of industrial design and marketing. In other words the cool kids buy Apple and a lot of us still want to be known as the cool kids.

So, as long as Agassi and PBP can adapt their plans to be more feasible (and spin it that they were always going to do that) then I think they have a chance of becoming the Apple of the EV world. And, an Apple of the EV world may be as viable as the real Apple in the consumer electronics world. Maybe. Would I invest my millions with them? No. But then I'm not, nor ever will be, a venture capitalist.

The problems facing mass/volume consumer acceptance of EV's are, speed, range and price.

...

Now don't get me wrong, I believe that the EV will eventually prove to be the only viable successor to the ICE, but only when it can approximate the same market appeal.

The holy trinity: "how far?", "how fast?", "how much?" I agree - but there's more than one way to get those three variables past the point of mass consumer acceptance. The thing that frustrates me the most with this is Madison Avenue and the last one hundred years of transportation marketing. Putting the subjective to one side (which looks better a Porsche or a Ferrari?) - the market has been thoroughly conditioned for two variables: speed and power. In the last few decades they've added safety and economy to the mix - but only as secondary features - as in "hey the new Volvo does 0-60 in 5 seconds and it's safe too".

Speed is sexy and sex sells. But who decided speed was sexy? Sure, there's lots of folks like me who get a thrill of driving and riding too fast (and unfortunately I have the speeding tickets to show for it). However, there are a lot of folks out there that I pass on the freeways ;-) - apparently they're not as weak willed as me. Yet, they're still driving a GTO or a Mustang - the high-end, high-power versions. Why? Because of good marketing.

Things are changing and folks are trying harder to market "green". However, there's (a) a lot of "greenwashing" of products which can poison this effort & (b) the folks paying for the "green" marketing of cars are the same folks that still want to be able to market speed and power so they don't often address these issues head on.

A classic example of the "conflict of interest" in the marketing of an EV is with GM's marketing of the EV-1 (see "Who Killed the Electric Car" for some info on that).

Unfortunately this is a very quixotic situation - it seems to be a case of "if you can't beat 'em join 'em" with folks like Tesla leading the charge there.

The answer to EV development is better battery technology or ultra-capacitor/whatever development. This is the holy grail of EV acceptance.

Nay, nay and thrice nay! Well actually, I suppose you could say that it's the "holy grail" in the sense that it's a quest of mythical proportions that if actually successfully completed will have questionable benefits! Which, I think, is not how you intended your statement to be interpreted. "We just need a better energy source" has been the rallying cry of the EV world (and the naysayers) forever. One could argue that it's been that way because it's the truth - or one could argue that it's simply a diversionary tactic by those that have other agendas to pursue.

I think the "holy grail" (in your sense - i.e. being able to spark wide spread adoption) is the 100/80/20 four-seater sedan. That's 100 mile range, 80 mph, $20K price tag. I wholeheartedly believe that a 100/80/20 vehicle is TECHNICALLY achievable today (by one of the big manufacturers). Whether it is POLITICALLY feasible or has negative impact on existing revenue streams is a different question. The "new contender" that I'm waiting to see if they deliver is the Detroit Electric (who have a $25K price tag and a faster top speed and a bit more range).

Why do I think those numbers represent the tipping point?

100 miles is one of those "psychological numbers" - it just seems like a lot. It seems like a figure that should cover most folks need with a second car.

80 mph is so that one can safely drive on the freeway without feeling like a target (even those that cruise at 70mph want to have something in reserve).

$20K is to make the vehicle affordable as a second vehicle. Personally, I'd take a leaf out of Kia's and Scion's playbook and make it possible to heavily accessorize the vehicle with entertainment, consumer electronics and other "non-automotive" functionality. Relatively cheap to add but gives a lot of wow-factor.

If I owned GM that's what I'd be concentrating on. Oh hang on a sec, I do own a controlling interest in GM (although so does every other American so I doubt I can get my voice heard).

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

Ah well, unfortunately, the outcome of all quests, mythical or otherwise, are always dubious and unexpected!! (Just ask poor old King Pryrrus)

However, in most part I agree with your analysis. However, my remarks were intended to reflect not my personal philosophy, but a pragmatic, real world, approach to develop, build, market and service an EV product with sufficient appeal to compete with ICE as a FIRST and ONLY car. In common with Better Place I recognize the difficulties experienced by the general public in accepting the replacement of ICE with acceptance transport. I have problems with the solutions offered by Better Place. It is not hard to identify the basic flaws in the Better Place business model. No matter how good the presentation (or passionately sincere the belief) snake oil remains snake oil!!

To answer your Question I am UK based, but spend a lot of time in Australia, NZ, South Pacific and Asia.

I wouldn't place your faith in Detroit Electric, if Toyota can't build a successful EV, sure as hell some hopeful con not. Yes, I know all those hopefuls are crying "you’re killing our initiative" but car manufacture is a huge and complex sophisticated industry, with a great many stakeholders. We don't live in Henry Ford’s day, and we can't turn back time. People want and expect an EV to deliver the same performance, convenience, safety and luxury as an ICE. Morally right or wrong that is the reality! It really bugs me watching all those SUV's picking up children from school in one of the most congested city on the planet, I know it is a silly fashion statement, but no one ever went broke underestimating the publics’ good taste!

I do envisage real scope for the future in EV'S rental’s. The light commercial, agricultural, specialist vehicle and Bus markets are also markets where EV's should do very well . I know my Lexus GS 450H is only a token gesture, but it does deliver me what I want, not need, but want. Note the difference? No amount of huff and puffing about the environment will persuade me to adopt a pedal car or some other totally impractical means of transport. Now that's where good ole, Shah Agassi and his guy's excel! With a ‘hey, let all get rich by supplying an EV that can do all that, by just setting up mysteriously organized battery swapping stations. In response to the feasibility of the such logistics are question, just chant the magic word, Software!

I think you should have more faith and sympathy for the US ailing giant GM. To me GM is very much a mirror of US society, deep flaws and immense greatness often go hand in hand.

marcopolo

jdh2550_1's picture

if Toyota can't build a successful EV

They did. It was called the RAV4-EV and it had a 100 mile range and an 80mph top speed (I think). Can't remember the price - but it was "too expensive". They stopped production after they lost a lawsuit and were fined $30M for using NiMH batteries. Sigh.

We seem to be having this discussion spread across this blog entry,the "who killed" forum post and the "small vs. large manufacturing" forum post. 'tis all very disconnected - but it is a great conversation.

Marco - are you aware of the RAV4-EV and it's history? Any comment on that?

John H. Founder of Current Motor Company - opinions on this site belong to me; not to my employer
Remember: " 'lectric for local. diesel for distance" - JTH, Amp Bros || "No Gas.

reikiman's picture

if Toyota can't build a successful EV

They did. It was called the RAV4-EV and it had a 100 mile range and an 80mph top speed (I think). Can't remember the price - but it was "too expensive". They stopped production after they lost a lawsuit and were fined $30M for using NiMH batteries. Sigh.

We seem to be having this discussion spread across this blog entry,the "who killed" forum post and the "small vs. large manufacturing" forum post. 'tis all very disconnected - but it is a great conversation.

Marco - are you aware of the RAV4-EV and it's history? Any comment on that?

The question is whether Toyota was successful with the RAV4-EV?

I've ridden in two RAV4-EV's - there are still some in operation that avoided being crushed - the dontcrush.com campaign worked with Toyota and not GM. Anyway my impression as a passenger was it felt like a typical SUV, not terribly exciting in that regard, a very normal SUV experience. It was cool going 70 miles/hr down the highway knowing the driver was going to have done 60+ miles in his total trip that night. It was easy to forget with the normalcy of it that we were in an EV.

I'd say in terms of it being a well built machine it successfully performed it's designed function. Curious thing is both of these RAV4-EV had a palm pilot taped to the dashboard giving more data to the driver. Indicates that Toyota had some failure with the design that the software in the palm pilot fixed.

But was it a business success? A commercial success? There are different definitions of 'success'. John, you and I are engineers and we might have a different idea of success than a business guy.

I have been in meetings with Toyota and listened to the enthusiasm from the engineers who created the program to build the RAV4-EV.

The difficulty for Toyota was that the amount of resources devoted to the project would be better invested in Hybrid manufacture due to market acceptance on a wide scale. the other two factors were 1) the RAV4-EV could not guarantee Toyota's required standard of reliability. 2) A lack of certainty of continued and expanding support from the US and Californian governments to continue to support EV's development, subsidies, tax breaks, compulsory charging posts, the list went on and on..

I think a lot of internal politics went on within the corporation between the hybrid exponents, and Plug-in guys also, although its hard to tell. But I believe a big factor was the difficulty for the pro-plug in lobby to deliver a certain success against the confidence of the hybrid faction from an economic point of view.

Anyway, that was just my reading of the situation, how accurate it is, I really don't know.

marcopolo

Mik's picture

But was it a business success? A commercial success? There are different definitions of 'success'. John, you and I are engineers and we might have a different idea of success than a business guy.

Or in other words: "Operation successful. Patient dead."

This information may be used entirely at your own risk.

There is always a way if there is no other way!

Er....yes! Pretty much! Although it's not easy working within a giant corporation, and Toyota is better than most. It's sort of like trying to direct an obstinate elephant, and becomes very bureaucratic. But if can can move it in the right direction it has the resources and capacity to accomplish developments responsibly and very professionally.

marcopolo


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