Nov. 29, 2010 - New parent company backs electric scooter OEM
http://www.powersportsbusiness.com/output.cfm?id=2703781
Okay, it's definitely time for me to call them up and see what I can learn. In any case there's an article just published saying that the new Vectrix is now ready to launch.
The article says new Vectrix has "spent the bulk of this year overcoming the obstacles of working as a new vehicle manufacturer, including finalizing state licensing agreements and establishing a new dealer network." Reading between the lines - the status old Vectrix had as a Manufacturer and the licensing agreements did not pass over to the new Vectrix. New Vectrix had to re-establish all that stuff and I've learned that it's really difficult to do so. Lots of details. Every state and country has their own rules for licensing motorcycle Manufacturers to sell bikes.
"Expected at the beginning of 2011, Vectrix will unveil its lithium battery technology, which will give its electric scooters further range." And their focus is to have a 100+ mile range.
Probably in Q2 will be the VX-3, a three wheeler. I'd be surprised if it'll be a conversion of the Piaggio MP-3 as pictured earlier, but there are three wheeler frames available in China that they could use.
Sorry to be pessimistic, but this appears to be more of a marketing/ litigation-avoiding exercise by Goldpeak, than a real commitment by Goldpeak to a Vectrix revival.
The problem all two wheel EV manufactures encounter, is that only a very limited market exists for a large, relatively expensive, two-wheel EV.
These bikes are not really practical vehicles, even within this relatively small market segment, and as a result service and warranties become a nightmare.
For small, bespoke makers like Brammo, or even Johns project, there maybe enough enthusiasts or specialist consumers to sustain a niche manufacturer, but to attempt to sustain a volume, mass manufacturer is economic fantasy and suicide.
Giving Vectrix greater range at the expense of freeway capable speed, is hardly a step forward! The Vectrix remains a curiosity, or to be kind, an interesting experience of what could be possible if a battery could be developed to make Vectrix a practically competitive alternative!
Vectrix size and weight are also a deterrent to sales volume. The sheer bulk of the Vectrix eliminates most female consumers. (perhaps less so in the US and Sweden, but Asia?)
As a concept, Vectrix holds great appeal. As a product, Vectrix must compete in a relatively small market. (only 3-4% of all traffic is two-wheel). Each technical restriction eliminates more and more market segment, as a result the price must inevitably escalate as unit/cost efficiency savings reduce. In turn,this further restricts sales, and so on...
In addition, Vectrix must compete at the lower end with, PRC produced, small, cheap, two-wheel EV's.
My observations will (as usual) infuriate the small army of Vectrix fanatics, but the truth is like that! No doubt there are still small groups of 8 track stereo fanatics, earnestly holding swap meets and dreaming of the return of this lost technology.
The key is the battery, as a basic bike, Vectrix is not bad. Vectrix shares a similar body style to various ICE maxi-scooters proven to be successful in the two-wheel market. Given the same performance, price, and range, it could compete favourably, due to lower running costs and reliability.
The imagined loyal 'green' market have proven to be non-existent without massive subsidies!
But we can only wait and see. Maybe GoldPeak, has a secret battery plan that will yet amaze...but I doubt it!
I think that Vectrix 'Mark 2', will hang around for while as a marketing brand exercise to lend credibility to a range of small, cheap, PRC EV scooters already marketed by GoldPeak and associates .
marcopolo
I own another electric scooter, not a Vectrix, but my "not really a practical vehicle" and "curiosity", serves almost exclusively as my local transportation for all but 3 months out of the year.
Good for you! But I think you misinterpreted my meaning. I was not referring to Vectrix from the viewpoint of the few owners who are satisfied with their bikes. (This number is probably less than about 300 for each year of production!Considering the true cost of a VX1, this would make the bike more than $230,000 dollars each to produce!)
Rather, I was attempting to explain the difficulties of mass marketing, mass producing a vehicle like Vectrix to a viable business model, and explain why Vectrix Mark 2, is unlikely to succeed, or at least succeed with a product like the VX 1. Vectrix Mark 2 claims it aim is to sell 5000 units per year. On that estimate, it's difficult to see how this can be done profitably. Gold Peak are not stupid, so another explanation must exist.
In hindsight, it is easy to see basic flaws in the original business model. These were not so easy to see back in the early days of promise (and high oil prices). The original marketing/production plan called for a minimum of 30,0000 units per year! The break-even estimate was 22,000 per annum. (10 times the VX1's total sales over 4 years).
As a private enthusiast, you may well find your VX 1, a practical solution to your needs, however as a production model, it's hardly a practical vehicle to produce for a mass market. Read through these pages at the comments from dissatisfied owners,and think whether you would invest your money in such an enterprise today?
The problems of Vectrix mark 1, were only compounded by the bad management and arrogant incompetence of its last CEO, Mike Boyle. Hindsight analysis reveals basic miscalculations in the original business model. The corporation grossly overestimated market acceptance, and underestimated the service requirements for such a product. Although the VX1 had other technical shortcomings, essentially like all EV's it's Achilles heel was the battery pack. Too expensive, too heavy, too short range and too long to charge.
Lithium batteries may help that situation, but not enough. Perhaps the promising developments by Ford Motor Co and the Swiss into zinc-air batteries may provide a breakthrough, but until then the VX1 remains an impractical curiosity, from a marketing perspective.
Look, if it was just a simple management or technical problem, and a mass-market for such a product could be identified, Honda, BMW, Paggio, etc would all be in production with EV two-wheel models.
The truth must be obvious by now, that truth, I maintain is that outside the specially market, there is virtually no economically viable demand for such a product as the VX1.
In Australia, long before the iMev, or the Nissan Leaf, an Australian company produced an excellent well finished, four door, four seater, small EV hatchback car based on gliders supplied by very popular, high volume, mass manufactured production model, The volume manufacturer backed the EV, with a 5 year, 180 dealer service network. Having driven all three, the Blade Electron is in my opinion superior to the iMev, and considerably cheaper. Yet in six years, only 34 units have been sold in Australia.
Why, when this is an excellent commuter vehicle with an educated, wealthy populace, 85% of whom live in heavily congested cities?
Lack of government subsidies? Well yeah, I guess that's part of the story, but in reality it's mostly just that although lots of people applaud the concept, they just don't want to own one.
Even the politically vocal Green, stridently environmental, well paid civil servants in Canberra (Australia's DC), won't buy an Electron. The Electron would seem to be the perfect commuter vehicle for that city. Canberra is a relatively small city in distances, has a very poor, public transport system based around buses. The city, and surrounding suburbs are flat, but have a well laid out road system. Canberra, is a city of low rise private housing with very few apartment buildings. Even the offer of free charging station by the local Electricity utility, and guaranteed "green' sourced power, coupled with an offer by the government to install heavily subsidised Solar power on every home, could persuade buyers to purchase what on paper would seem to be the perfect commuter vehicle.
You would think the Blade Electron should be a terrific success, but only 5 units have been sold in Canberra, and two of those are to the local power company, one two the University, and two to government departments!
Just because something seems like a winner, doesn't always work out that way.
But I'm glad you like your VX1, I live mine! Although I use it a lot less than you, I still enjoy the experience, as someone put it, of riding on electrons.
marcopolo
Hi,
I must say that I mostly agree with you Marcopolo, this is the sobering truth I guess.. As a business model it's screwed, if you own a Vectrix that performs as you expect, you'll be a lucky and happy chump!
In that marginal 'niche' segment,I too feel lucky to have one, and it still feels like it's becoming a 'sort-of' good investment (if it doesn't suddenly fail after I said this:-)).
I noticed that many people are interested in the technology, an indeed it's a good shot at sustainability, an it's a cool bike, and it's cheap to run, and.............. BUT in almost two years of ownership I haven't seen anyone who said; "I want one!" nore have I ever seen another V "in the wild", probably due to the climate over here.
GP must have other plans, like boosting their image: a long time ago (2 years?) they sold their AA batteries with a coupon to actually win Vectrixes..
But they couldn't be stupid enough to think that sales are gonna quadriple now, could they?
They can afford to lose (read: "wildly invest") some money, and I bet they know they will..
I we are to see more quality bikes like the V in the future, it will be BMW or other big brands who will give it a shot, I guess AFTER electric cars like the Leaf prove to be succesfull.
What I DON't believe, is that electric scooters/motors/.. in general will stay in that "niche" segment. Look at China, what was it? must be more than 2 million now, ok, they're crap, but they'll get better, cheaper, and wide-spread in coutries with favorable weather..
I bet in 10-15 years from now 50% of all new bikes will be electric, starting with the smaller models.
Why am I so certain?: range will no longer be an issue by then.
Turok
"doing nothin = doing nothing wrong" is invalid when the subject is environment
Yes, you are probably quite correct, eventually all vehicles will be electric or biodiesel. EV technology is neither new, nor particularly complex. It's just the energy storage system that needs to be improved, once that can rival the range and convenience of ICE, then the change over will happen very quickly.
Ford's zinc-air battery development is interesting because it would permit a battery with very high capacity, very low cost, but a short life. This is not a disadvantage for the automaker as it would guarantee an annual service income for the dealer in battery swapping, included in the annual service fee.
Your estimation of 10 years or so, seems very realistic.
marcopolo
Marcopolo,
Your whole analysis is ignoring the sheer engineering incompetence behind the Vectrix effort. You seem to be using the Vecrix a model for the state-of-the-art, instead of the incompetent enterprise that it was. The Vectrix contained unneeded, gratuitously complex and unreliable system piled on gratuitously complex unreliable system - basically too many "cooks in the broth". There is no reason why electric-powered scooter shouldn't be inherently more reliable and less expensive than an IC engine powered scooter. An electric motor, and associated electronic controller is far simpler and amenable to automated manufacture than any IC engine ever will be.
A lot of the problems with improving the batteries lies with corporations sitting on the patents and in a scheme similar to insider trading, refusing to license the technology to drive their value up.
Scooters are primarily for urban use, and a public-sector effort to provide charging facilities whenever the scooter is parked, would make the reduced range a non-issue. The price of gasoline will be increasing, which is going to improve the situation too. The "fuel" cost of Thundersky-powered electric scooter (battery pack+charging) is less than a comparable performing IC scooter at European gasoline prices and only slightly higher (but not for long) at US gasoline prices.
BTW, I don't have a Vectrix, I have a cheap Chinese scooter it took 3 years of shake-down - including going to a completely different battery pack (Thundersky lithium), but there is no reason the damn things can't be made right from the start.
Well as I did read Marcopolos threads it seemed to me he just mentioned theese problems didn´t he?
Vectrix had "only" two mainissues leading to the struggle: Bad marketing (Range and lasting of the
battery where wrong mentioned) and the complete absence of a BMS (12 temp-probes maybe detecting fast
enough the overheating of 36 cells out of 102, only rudimental[or complete absence] of voltagecontrol
whrere leading to the batteryproblems and therefore to the problems with warantyclaims. By the way
it was the only scooter at that time which was big enough for short intercity trips. I tried a chinese
scooter to for testride, but they are too small for "longer trips" (I ride between 60 and 100 Km/day.
Sad that Vectrix had not the patience to make a sucessful BMS. Many RAV 4 EV are still running with
their batteries because of a good BMS...
Greetings Mike
Are we overlooking one of the key problems with current EV successes? "Big Oil"! need I say more? When the barrel was runnning towards $150 and we paid $4 in the US Vectrix had a chance. Now, complacency has set in again. We sould be paying $6-8/gallon and the EV industry would have a chance. But Big Oil is not sleepng either. They know that very well. They will keep gas below $4/gallon at all cost.
Paul, once again you have misread what I wrote. Didn't you read the bit where I acknowledged to the various technical shortcomings of Vectrix?
However, these fault aside, Vectrix was at the time of its conception (15 yrs ago) a pretty damn good effort at creating a state-of-the-art EV.
Every product is easy to Cristie after a passage of time, and lessons learned by pioneers become obvious in hindsight.
But again you miss the point, Vectrix was the first, and to date only manufacturer, to build a bike to seriously rival a mass/volume ICE market segment. the reason it failed was market logistics, not technical defects.
You tend to view things from a personal aspect, which is fine except when dealing with issues of a general or volume nature.
Any competent engineer can produce a competent EV, the trick is to be able to mass manufacture and mass market the product. This takes entirely different skills, most of which are unrelated to engineering.
No answers? Technology a bit hard? No problem, just invent a conspiracy theory! The concept of 'corporate conspiracy', is just plain silly! Yeah, a wonderful plot line for a Oliver Stone movie, but it just doesn't stand the test of objective analysis.
No corporation can sit on patent technology. If the technology is in the public interest, the law says that if unreasonable access is denied to a gratuitously dormant patent then the patent expires. Another factor, is the PRC. PRC, government or private owned ,corporations care little for patents, dormant or otherwise!
Corporations do not sit on 'technology patents' to 'drive the price up' for fear of being superseded! Imagine a corporation who had cunningly withheld a really super-dooper method of improving the typewriter? The Directors of Corporations want profits now, today, to show the shareholders what brilliant executives they employ, and justify huge bonuses!
Again, you speak as an individual. But your view is not shared by your fellow consumer. The price of gasoline to a Vespa owner is simply not an issue. Most European scooter owner live in apartments, and charging is an issue. The environmentally conscious market is also too small, even in crowded European cities, scooter ownership is relatively small. Only in Asia, does two-wheel traffic occupy a large market share and outside the PRC, two wheel EV ownership is very small indeed.
I own a 1966, Coomes special, mark 11 Jaguar. This car is an absolute work of art, inspiring much admiration from passer-by's, and fellow enthusiasts with more money than sense! But I wouldn't seriously advocate this vehicle as a form of reliable daily transport. My Lexus may not inspire the same emotion, but it does it's job efficiently and reliably. So the Toyota product finds a ready market for mass manufacture.You may not like the ideology, but modern capitalism is a democracy, the consumer votes with the purchase.
I also own a Blade Electron EV, not terribly practical for apartment dwellers, but I don't have that problem. I often ride my Vectrix and I enjoy the sensation, but I understand its short comings. I have a business renting Vectrix at resorts, the bikes inspire enthusiasm among holiday-makers, but no one wants to buy one. Like Elephants, everyone likes the concept, but ownership? In most western cities, two-wheel traffic is simply neither safe nor desirable for most commuters. The problem of enthusiasts is that because Thad enjoy or believe in something, they try to evangelise other into the same thinking. Thats OK, but when you start to demand that the government change regulation to suit your personal preference or ideology you become a danger to your fellow citizen.
If people want to ride small, under performing, dangerous, Little EV scooters, they will go out and purchase. You can't create an artificial market environment just to suit your lack of compatibility with your fellow citizens tastes. (well you can, and the result is a Trabant!)
Cheer up Paul, more that 180 large corporations, some backed by huge government or defence research budgets are striving to find the magic electric storage device. The breakthrough Will come, maybe Ford's Zinc-Air, or super,super capacitors, or who knows? Maybe something really radical, but human ingenuity will solve the problem.
marcopolo
Actually marcopolo I think you are also somewhat misreading Paul. To me he's saying that you're saying "because Vectrix failed all 2 wheel EV businesses will fail" (you know the argument that just because this bus is red not all buses are red). I'm with Paul - Vectrix failed because they didn't have a good enough product (not enough range) and they COMPLETELY misinterpreted the market (much in the same way as many dot com companies did).
Sorry, but to say it's easy to point out VX-1 failures in hindsight is far too kind on them. Capacity for 36K per year??? 10 years to market??? 22K per year break-even point??? WTF were they smoking? I've met Andy MacGowan (or is it McGowan?). He's a very charismatic individual and a very strong salesman with a persuasive argument. He also has his own view of the world - which somewhat matches marcopolos. He has very grand visions. Perhaps in 10 years they will be appropriate.
And as for pricing - they priced the bike on what they needed to earn not what the market would value it at. There's a lot of studies out there that say that "greenies" will pay up to a 20% premium for a green product. So, maybe if they'd come in at a 30% premium it would have still played out different. But at 100+%???
Of course, I wholeheartedly agree with Paul - this isn't a niche nor an impractical item. I've put my money where my mouth is. As has Paul - he has two "mid range" electric scooters which he has successfully used. MP3 players started as a niche. So did cell phones. Apple made $4B in profit in the last quarter. But everything starts small. 80% of motor scooter riders could switch to an electric version with NO IMPACT on their usage. Millions of people purchased hybrids to support a lifestyle statement - not an ROI.
One has to start off small with a process that can scale up or down. Knowledge built up in this period will be worth it's weight in gold when they EV motorcycles / scooters take off. That's when the big boys that you mention will swoop in - and purchase us little guys...
Now, who wants to invest? <-- Dear SEC, that's a joke not a real request for investment because I know I can't do that. OK?
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.
That's true John, but there another saying,..If it walks like a duck, and quacks, its a good chance it is a duck!
Now thats a little ungrateful! Everybody learned from Vectrix. Do you imagine if Andy McGowan had explained to his investors and creditors, (including GoldPeak,) that he was going to build 50 a year he would have received any support?
At that time with no real generic parts or concepts, Vectrix tried to become a volume manufacturer. The reason they failed, apart from quality control issues and poor management, was that the basic business model is flawed. A market doesn't exist( certainly not at that time) to support a high quality, mass manufactured, freeway legal, EV bike. The high price was always reflected by the cost of low volume components.
Ok, I agree, I have always maintained that a relatively small market exists for niche vehicles, 'green' products, etc. But not in volume. I was trying to impress on Paul that Gold Peak will experience the same problems as Vectrix Mark 1, if GoldPeak tries to revive Vectrix to previous expectations. Even with better management, and improved quality control, there just aren't enough buyers to sustain a high priced, low range two-wheel EV.
Exactly my point! But if you concede that Vectrix was over priced, and also concede that such a vehicle could not be built, at that time, for less, the whole exercise becomes doomed to failure from the outset! A hybrid car, like my Lexus 450h, (15% premium), or a Prius (20%), will do exactly what the ICE version will do, but better! No drawbacks!
Toyota already have the basic car, (selling millions profitably) so Toyota can also afford to spend billions on a marketing, research exercise.
Vectrix, does not perform the same as its ICE version! Even the ICE version of Vectrix has a relatively small market in western countries. Actually, two-wheeled transport is only a very small percentage of westrn personal transport.
Until you can build a product that can compete favourably with its ICE competitor, there is no real market buy of a small enthusiast/specialised market. Without unit cost savings from mass production, its difficult to see how any enterprise can survive beyond the bespoke niche market.
Sorry John, but those are just the basic laws of mass-manufacturing. small producers do not survive. Look at Morgan, etc these are very limited production runs, but sold at very high prices. Low volume and low prices do not equate!
The cost of fuel is not really an issue with the light bike/small scooter buyer. I mean how much can you save?
You say 80% of small scooter riders could switch to EV version with no impact. Well, why don't they? Are sales outside the PRC dramatically increasing year by year? Only in years of petrol price spikes do scooter sales increase, and a only a small percentage of those purchase a two-wheel EV.
Vectrix, wasn't that bad a product. It certainly has a small but fanatical loyalty base! But the market segment to sustain a volume manufacturer will not exist until two-wheel Ev's are competitive in performance and price (allowing a small premium) with the equivalent ICE.
Until then, EV scooters will remain a low volume niche market item.
The key, is the battery! Build a capable electric storage device, and all EV's, including two-wheel, become viable.
John, everything I have written is within the context of Vectrix as a mass- volume producer. Small volume manufacturers are by definition niche market players.
Since manufacturers like you are hoping to capitalise on this existing niche market, I wish you luck. nothing I have written about the viability of a Vectrix revival, is relevant to your enterprise. (unless you want to try and reach those figures).
You are correct, in the near future, the large manufacturers will enter the two-wheel EV market, and hopefully will seek the services and talents of the pioneers to augment their own.
marcopolo
quack quack! :-)
Actually, it's not ungrateful. I fundamentally disagree with your faith in that Vectrix did it in the only viable way - either from the business/economics or the engineering.
If he was going to build 50 a year for the next 10 years no. If he was going to build 50 in his first year and get to 10,000 by his 5th or 6th year - maybe not even then. But, if he was going to do this right that's the sort of path he needed to plan to follow. Sure, it would be more difficult to raise the money - but he'd need less of it and ultimately he would be "de-risking" the investment.
This is where we disagree. Lots and lots and lots of generic parts and concepts existed - they just decided to reinvent very expensive custom ones. They didn't go to the Brembo brake catalog and choose brakes and then design within those constraints. They contracted Brembo to build brakes for them - of course Brembo was delighted to help them spend lots of money. Same with the body design - I think Andy said they went to Pininfarina (who I'm sure relished the chance to help them spend money). I could go on and list lots and lots of other examples (including fundamental aspects of the powertrain as well) - but I think you get the picture. The Vectrix is a classic example of "not invented here" syndrome - no doubt protected and perpetuated by the myth that they were doing something so revolutionary and new that they had no choice. I'm sure that's what they told the investors. In fact what they were doing was "just" making a motorcycle with a different engine and energy storage.
I've said it once and I'll say it again. They decided to (and succeeded) in building a "Cadillac" (or "Lexus" or "Rolls Royce" or "Bentley") of two wheel EVs. Lots of complexity (some would call it gratuitous), very high production values etc. Now, there are quality small cars in Toyota, Honda, Ford etc. But they ain't Cadillacs.
I suspect Mr MacGowan built the bike he wanted rather than the bike a green consumer might have wanted. When (not if) the two wheel EV market is mainstream then there will no doubt be more customers who are ready for the Cadillac experience. Vectrix have tried to leap frog to that position - they tried to lead the market instead of being market lead. A primary sin!
Yup, I agree with that. We're still too early for a Cadillac bike.
Nope, I don't concede that.
We're talking scooters here, not cars. Even though both cars and scooters are primarily driven short distances the market is more comfortable and has an expectation that they will use a scooter for shorter range. Not crazy short (as in Vectrix) but reasonable (as in CuMoCo??).
OK, so let's define mass market? The US market for scooters is around 200K units per year (and has doubled in the past 5 years). 80% of that market could use an electric version of the product with ZERO change in their usage pattern. It would in fact in many substantive ways be more convenient and thus a better experience. European market is around 1.4M units per year - I imagine that a smaller percentage of users in Europe could switch today and not have to deal with "range planning" issues. Put it another way - in Europe they seem to ride their scooters further (I believe Vectrix sold more in the US than Europe). Rest of the world (including India and PRC) is nudging 30M - there are many challenges to cracking that market.
So, in total we've got a worldwide scooter market of around 32M units per year as of today. Yes, that's small potatoes compared to cars and trucks - but it's hardly insignificant in absolute terms. Take out RoW if you want and stick with 1.6M - that's still a good market.
Oh, I know that - you've been nothing but gracious and supportive towards my venture - I do appreciate that. I also appreciate the chance to examine your position and compare it with my own.
Yes, I want to try and reach those figures - not this year or next. And that, to me, really is where Vectrix went wrong. They tried to jump to the head of the queue without evolving with the market. It was a bold, high risk strategy - and it failed. Having created that cost structure they can't simply realign themselves - they need to start over. Chapter 11 might have given them the opportunity - or it might just turn in to Goldpeak limiting their warranty claims and/or someone trying to repeat the same mistakes.
But hey, what do I know? I wish them luck - their success is likely to help me more than they'll hurt me (because the market is BIG).
Yay! ;-)
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.
No, I agree its not the only viable way of building a two-wheel EV. However, it was the only way of producing a Vectrix type product. Vectrix envisioned a market that didn't exist. Vectrix hoped to capture that market by producing a really advanced and viable product that would set the world on fire. Change peoples thing about EV transport, completely!. In some ways Vectrix succeeded brilliantly. No one who rode one once could fail to be impressed. In the long run the business plan simply wasn't viable. If BMW Yamaha, Honda or even Harley-Davidson had built the VX1 and advanced as a loss leader, marketing exercise to enter the EV market. Who knows? With constant development and improvements, it may have achieved a better reputation and reception. [/quote]
Hmmm.. got my doubts about your logic. but maybe I don't understand. Could you explain how any enterprise as complicated as vehicle manufacture can economically advance from 50 units to 10,000 in a mere 6 years. In Henry Ford's day, perhaps, but today? How are you going to guarantee components supply, spare parts, servicing, dealership issues, model advancement, regulatory problems, financing fluctuations, competition, sales overhead, setting up a production line, etc..
Andy Mc Gowan was on a mission. He didn't want to build 50 a year, with existing parts and re-branding other peoples engineering, he wanted to create a Model T, (albeit a rather expensive one).
Ok, but the 'quality' small cars built by Ford, Toyota, Honda etc.. require a massive investment in mass-manufacture infrastructure to be economically viable. The fact is that outside the PRC, two-wheel EV's are just not viable to produce in large numbers.
As I understand your philosophy, you are advocating a production technique of assembling your product from the best of available generic parts, and as a bespoke manufacturer you are relying on only a small servicing requirement, due to a)proven reliabilities of components b) small numbers and a relatively local marketing area c)Ev's require less service d)some engineering 'tweaking' of your own. This is not a bad business model for a niche, or bespoke manufacturer.
But I think we should really ask the following questions as a guide to whether such a product can become a volume seller:
1)Why will you be different than 90% of niche specialist, vehicle manufacturers that disappear with the first five years of business?
2)What is the maximum envisioned range of your product?
3)Charge Time.
4)Maximum speed
5)longevity and cost of battery replacement.
6)Retail Price per Unit (including Tax)
7)Size and Weight
8)Warranty
9)Service facilities
10)Safety rating
11)Nearest competitor comparison
12)Guarantee of component supply
13)Ease of operation
14) Insurance
John, there are good reasons why small manufacturers remain small. The jump form bespoke to volume is very difficult, often destroying the very thing that made the product viable.
In all fairness, you are unlikely to ever export to Asia, or India. Even in Europe, you would face difficulties to be accepted in the European market in any numbers. So you are left with th US/Canada market which you say is 200k (I put it at 120k,but you are probably right). Ok so lets look at your two-hundred thousand. lets eliminate 40% who don't have convenient recharging facilities,(or perceive they don't). 10 percent who want greater range, 30% who want a cheaper ICE product, and 10% who are buying a Vespa for romantic reasons, that leaves you a potential market of 20,000. Not bad, especially if you can capture the rental, specialist market. But at the bottom end of this 10% there will be at least 1/3 rd who would prefer to buy a cheap PRC sourced bike. that still leaves 12,500.
Not bad, not bad at all for a niche, or bespoke manufacturer producing and selling a low volume but US branded, high quality attractive bike. Without all the expense of becoming a mass or volume manufacturer, you should be able to produce 1-2000 bikes per year, at a net profit of $1000 per unit. Much more and either capital equipment cost, or labour cost will kill you!
The main danger will come from your suppliers. Most small specialist manufacturers have been destroyed by component makers. Not just small, remember Firestone!
So, as I say, the best of luck! You have all the knowledge and courage to succeed, It's just the old question if you can deliver a competitive product, at a competitive price!
marcopolo
I'm not going to explain - but I do hope to show. ;-)
We do have answers to most of those questions in our business plan (but not all of them).
In some ways this is far more possible today than in Henry's day - because of the globalization, componentization and commoditization of the market place.
Your opinion based on your understanding of the costs and hurdles is that it's not viable. In fact I'll agree it's the prevailing opinion. However, I dispute that it's a "fact".
That's close enough to it at present (although the tweaking is a bit more involved).
1) Because we're approaching it differently than 90% of other niche folks. By keeping the final assembly in the US we pay more but we ensure that we control the quality. We will also focus on a high level of service. We have a great product. Oh, and we're nice too!
2) Today max range is 50 "real world miles" (that's half in town and half out of town). We're going to get away from these silly idealized numbers. I can see that going up 10% or so in the short term (as we improve efficiency of various components), 50% or so in the medium term (e.g. if we shift to a LiPo solution robust enough for transportation) and 100%+ in the longer term (depending on which of the great number of new technologies pan out). The trick is to be flexible - to be battery agnostic so to speak.
3) 4 to 6 hours on US household circuits. 2 to 3 hours on 220V circuits.
4) 70mph today - I'd like to get to 80mph so as to support more comfortable freeway / motorway use.
5) 2,000 cycles / 5 years life and $2,500(ish) total cell cost today. Better in the future.
6) For the maxi scooter $5,500 to $7,500 excluding tax. You'll have to add on your own tax depending on your location. You can also take off cost if there are available rebates - again depending on location.
7) Weight 400lbs. Size: Seat Height 27 inches; Wheel Base 57.5 inches. Significantly lighter and smaller than the Vectrix - less intimidating for first time riders. But still a maxi-scooter.
8) 36 months pro-rated on batteries. 12 months on everything else.
9) We will build up a network of approved service centers. We're also going to explore in-home servicing - via a third party.
10) Fully FMVSS and DoT certified. I'm not aware of any other third party or additional safety ratings for motorcycles.
11) Nearest competitor is a Brammo Enertia or possibly a Vectrix VX-1. We are already far ahead of the PRC imports (at some point I will provide a detailed comparison of our bike vs. an eMoto G6 which will show exactly why we're ahead of so many of these imports)
12) We'll be strengthening our supply chain commitments throughout 2011. Now that we have some backing and some confidence we can push harder on this front. Not something we could have done if we only have "niche" / "lifestyle" ambitions.
13) Best in class for ease of operation. No silly "battery maintenance" requirements (like having to do a deep discharge every X times etc.) and a simple "long term storage switch" when storing for a couple of months or more.
14) Company insurance or bike insurance? We have PL insurance from a major name and some of our bikes are already on the road and insured. Not an issue today - shouldn't be an issue tomorrow.
1) We'll never export to Asia or India. We might license or build there though.
2) Europe should be very attainable for us - but we do recognize it as one or many distinct markets with distinct requirements. We're starting in the US as our beachhead.
3) I'm not going to bother discussing your breakdown of numbers - there's no real hard facts in there. Just supposition.
You say "niche market" I say "beachhead market". Capital equipment and labor costs won't kill us if we approach this as a partnership with suppliers and keep our focus on creating the final vehicle not bending metal.
True, we need to develop additional sources and to remain nimble.
And I thank-you again. I appreciate it. You're right - the proof will be in the market. Don't get me wrong it won't be easy and we (like anyone else) will need some luck. We also need to plan appropriately for capacity.
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.
Well, I'm sure we'll all be cheering for you!
Ok, I agree. If the large Japanese,German, Korean, Indian or even Italian bike makers enter the two-wheel, EV mass-volume market, the market may become viable outside the PRC. The respect for the Brand names of these makers, coupled with assembly line efficiency, and technical advancement should provide sufficient incentive to command a premium price.
Yes, you are correct, I am surmising. Although, based on fairly well educated market analysis. But a guesstimate nevertheless!
From the specifications you have provided for the CoMoCo product, it sounds excellent! The range is still short, but acceptable as commuter transport. The maximum speed is acceptable, and the owner friendly battery technology, is a definite step in the right direction. The rest is as good if not better than the VX1.
Pricing? Ok, let's accept that the US market will pay retail at $US 7500. Quite reasonable considering the ICE Vespa etc, are only 20-30% cheaper.
Given the currency rate of the US dollar, this should be a boom time for US exporters.
At the time that Vectrix was in full export mode, the US dollar was commanding a 30% premium over most currencies. Mike Boyle insisted on being paid in US dollars for what was essentially a Polish bike. The result was that distributors outside the US were obliged to pay $US 8900, which translated to most local currencies to in the equivalent of $11,500, plus the cost of importing,local registration, dealers commission etc. This meant the local final retail price had to be $15,000 dollars, or so, against the ICE equivalent at around $6-7000!In some of these countries a small car, cost about the the same price!
Vectrix was simply not competitive! To add insult to injury, the unfortunate local distributor got stuck with the crazy servicing costs(supposedly rebated by Vectrix Corp but never actually paid), and lousy batteries!
To make matters worse, all local websites referred to the main US website which gave the optimistic US price of $8900 retail!
Only one item you neglected to mention. The cost of battery replacement. Vectrix got round this aspect by claiming a ten year + battery life. This was hard to establish as every battery problem was blamed on the customers neglect of the battery regime. How much is the CoMoCO battery pack to replace?
Otherwise, the product sounds great, reservations aside, as to the problems you will encounter in trying to raise production to volume numbers, even at your beach head figures you should be viable.
Congratulations!
I am eagerly awaiting trying and evaluating, your final production model, and would seriously consider CoMoCo as a replacement for our ageing, and increasingly problematic, Vectrix fleet.
Good Luck.
marcopolo
I did answer it - but I may have obscured my answer
To replace all the cells in the battery pack would cost $2,500. We can replace individual cells (at one 30th of that price). This doesn't include the cost of the BMS or the charger etc. That's why I called it "total cell cost" and that term may have made you miss the data.
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I was a little dismissive in my comment about not discussing your breakdown - sorry about that. They may be reasonable guesses - the one I'd question most is 40% without access to a power point. However, I think "arguing" or "debating" these figures really comes down to a decision to agree to disagree.
I do appreciate your arguments - they are well based. I think the key area of difference is that we think we can start small and scale to mass numbers and you think that the market won't support that.
Time will tell - and I appreciate all the cheering on we can get :-)
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Drop me an email at john at currentmotor dot com and we can talk more about 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.
Thats good. Vectrix batteries are very expensive to replace, but were supposed to last 10 years. Still its an additional operating cost of about $10 per week. Or more importantly, a second-hand cost in 5 years time. I'm not sure how, or even if, that will effect sales. (perhaps battery costs will have reduced dramatically in 5 years).
I think your biggest positive selling feature will be ease of operation, the negatives include the relatively low range and competition from cheap imports.
But as you say time will tell, and you deserve all the support you can get.
marcopolo
I imagine that in 5 years time an owner would have a couple of options (in reducing likelihood of availability):
1) Replace the LiFePO4 pack with another LiFePO4 pack of similar performance (maybe 10% or 20% better) for significantly less money
2) Replace the LiFePO4 pack with another chemistry for $2,500 - that pack might be automotive grade LiPo and offer 50% improvement
3) Replace the LiFePO4 pack with another chemistry that's dramatically better (say 100%) for whatever the going rate of that new technology is
I'm very confident about #1. We've seen battery costs fall 40% or more in the last 3 years and supply is going to greatly increase which will increase competition. Of course, demand will also increase - however, I expect LiFePO4 batteries to be considered a commodity with slim margins for the producers so I think the net effect will be lower prices.
I'm fairly confident about #2. Already Kokam appear to have a suitable automotive suitable LiPo cell. I expect we'll see more companies (including everyone's favorite PRC) enter that market resulting in more options there.
I don't really know about #3. There are lots of promises out there - will any come to fruition in 5 years? It's not impossible. I wouldn't bank on it - but nor would I be amazed if that were true. However, I don't think there will be many people who will want to spend, say $5K (just an example) on a new battery pack for their 5 year old $7,500 bike. However, someone might be willing to spend $10K for a bike with twice the range than the $7.5K version.
This to me is one of the key beauties of EVs - choice of battery pack.
(reikiman et al - sorry that this thread shot off in a completely different direction - but I think it's a "good topic" and can be applied to a CMC or a Vectrix)
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.