The appeal of electric cars is becoming more obvious as gas prices edge ever closer to $5 a gallon this summer. If you're affluent enough, you may be tempted to buy one right now. Don't. Give it a year or two while the technology (particularly in batteries) continues to improve.
Here are three strong reasons to sit tight, at least for the moment. But scroll down for some caveats -- early adopters are going to take home the biggest government subsidies and get the best individual attention from dealers and automakers.
The case for waiting
Early buyers are guinea pigs. Electric vehicles, or EVs, represent a radically new technology, and it would be a miracle if they didn't have bugs to work out. No miracles here. One big issue so far is the way the cars can dramatically lose range in cold weather due to the unexpectedly high energy drain from the electric heater. Automakers are still scrambling for workarounds on that.
The Nissan Leaf has also had some software bugs that leave it stranded after failing to restart, as well as over-optimistic range estimates. Buyers of later cars will benefit from fixes for these early SNAFUs.
Better batteries. Let's face it, 100 miles is not enough range, and it forces EV owners to watch that range gauge attentively. Sure, the experts may say most people drive only 40 to 50 miles a day, but "range anxiety" is still a big issue.
The good news is that lithium-ion battery technology is moving fast, and in two years 200 miles may be the new normal -- and cold weather range loss won't be such an issue. Engineers at Tesla (TSLA), for instance, thought it would take a year after the 2012 Model S sedan introduction for the car to get its optional 300-mile battery pack. Instead, that battery will be on the first 1,000 cars built next year.
And solid-state batteries, which jettison the liquid electrolytes that double cost and weight, are an around-the-corner technology that could dramatically increase performance. General Motors' venture arm recently pumped $3 million into one solid-state battery startup, Sakti3.
A charger on every corner. If you plan on charging up your car while you're out on the town, at the moment you're generally out of luck. Public electric-car chargers â€"- at malls, big boxes, office parks and in front of the local Starbucks (SBUX) -- are just starting to trickle out. The Leaf's handy app will give you a map of stations, but it's still displaying many that don't even exist yet.
Federally supported charger installations are moving slowly, and utility-based programs are only now gearing up. For-profit companies such as the Car Charging Group have put in dozens, not hundreds, of stations. If your plan is to rely on the public infrastructure, it's better to wait.
The smart money is on watching and waiting, but here are three ways the early birds will benefit from being ahead of the pack:
Free money. Two federally supported programs, ChargePoint America and the EV Project, are putting free chargers worth $2,000 or more into thousands of homes in strategic states. Together, they're going to make about 10,000 homeowners happy (especially if they own Chevrolet Volts or Nissan Leafs).
California has a pot of money from which to hand consumers as much as $5,000 up front if they buy selected EVs. You can apply right here. But California's budget problems are legendary, and who knows how long this program (or those in other states) will last?
There's also a $7,500 federal tax credit (not as good as upfront cash) that everybody gets, but it's limited, too, and only available to the first 200,000 EVs from any manufacturer. It will take a while to run through those credits, but they could disappear on the most popular cars (which is why a pending bill would extend it to 500,000 cars per carmaker).
Driving past the pumps. Make a few calculations, and it will soon be obvious that earning back your extra investment in an electric car through lower per-mile costs will take many years. But SUVs never made any practical sense, either, and it didn't stop people from buying them in droves. Choosing a car is an emotional experience, and the electric choice comes with the satisfaction of avoiding record high gas prices. Charging at home costs 5.7 cents a mile (Volt) or 3.7 cents a mile (Leaf), compared to 25 cents per mile for an average gas car on $5 gas. What's that good feeling worth?
Great customer service. Automakers are, understandably, anxious about their EV programs. Their early adopter customers are the people whose word-of-mouth experience, relayed in online forums, on Facebook and Twitter, will form the public wisdom about these cars. So when these folks ask for attention, they get it, from the car companies and from the local service departments. According to Felix Kramer, who owns both a Leaf and a Volt:
They're very concerned, and I get great service. With the Leaf, they brought out the lead technician to meet me and ask how it was going, and they're constantly evaluating my experience. The Volt people have been incredibly attentive -- if I have a question, they're very concerned until I find an answer. They're always making sure I'm happy.EVs are definitely a gamble in 2011, but some people might like the odds. Are you feeling lucky?