Rollout Of Chevy Bolt May Mark Turning Point For Electric Car Market

Feb 13, 2017
Originally published on February 15, 2017 9:28 am

The Chevrolet Bolt EV, which is now hitting the market, could be the first of a new wave of game-changing electric vehicles.

Its longer range and lower price could attract new buyers to the electric car market, but there's uncertainty over whether federal tax incentives will continue and whether California will be allowed to keep tougher emissions rules under President Trump.

GM is marketing the Bolt as a small crossover. It has the footprint of a subcompact and the interior space of a standard car. More important are its range of 238 miles and price tag of $30,000, after the $7,500 federal tax credit offered on electric vehicles.

Currently, the only other all-electric cars for sale with that kind of range are Teslas, which cost upwards of $70,000.

"In all our research, we've talked to consumers, and really that 200-mile EV range at the affordable price was kind of the tipping point for them to really consider this a mainstream vehicle, so we went after that," says Darin Gesse, product manager for Chevrolet Electric Vehicles.

GM is rolling out the Bolt in phases: It's currently available in California, Oregon, Maryland, Virginia and Massachusetts and will be in all 50 states by the fall.

Like other all-electric cars, it has no tailpipe. As for fuel efficiency, the EPA gives the Bolt a rating of 119 MPGe, or miles per gallon equivalent.

But without some environmental motive weighing in the balance, does the bottom line check out?

We asked a few people who had stopped to look at the Chevy Bolt at the Washington Auto Show earlier this month.

Jack Cheng of Potomac, Md., already drives an electric car, a BMW i3. He is impressed with the Bolt's longer range, but less so with its price.

"For the price of the car versus what you get, you probably don't come out ahead," Cheng said. For him, the selling point is the environment; he likes the fact that he's not polluting.

Price is also an issue for David Manfredi of Davidsonville, Md.

"It's just expensive," says the electrician, who currently drives a Toyota 4Runner SUV. Manfredi hopes to cut the cord on oil and gas, so he is looking at not just the Bolt but also the Volt, Chevy's plug-in hybrid.

Manfredi says he couldn't consider either car without factoring in the $7,500 federal incentive. "That's a huge credit, so if that disappears then I think we'll have to disappear from the market."

Clean car advocates are concerned about the future of electric cars under the Trump administration. Could the $7,500 credit disappear in a new tax bill? Will Washington continue to spend millions on battery research?

And then there's uncertainty over whether President Trump's EPA will continue California's waiver for tougher car emissions rules. Washington permits California to set stricter emissions standards. Nine other states have gone along with Sacramento, adopting Zero Emission Vehicle regulations, or the so-called ZEV mandate. Automakers have to sell a certain number of electric vehicles, often at a loss, to sell profitable internal combustion engine cars.

"The consensus is that nobody knows what the heck is going to happen next. Nobody," says Dan Neil, auto columnist for The Wall Street Journal. "And the sense of uncertainty is really weighing hard on an industry that is capital intensive, long-term planning. They don't like uncertainty in the auto industry."

Simon Mui, who works on energy and transportation issues at the Natural Resources Defense Council, says government support is still critical to the electric vehicle market. He says without subsidies, it's likely going to be 5 or 10 years before electric cars are price competitive with gas-powered vehicles.

"Today, with incentives, you're very close to that point," he says. "Consumers that are charging on electricity, if they charge off-peak, they're basically paying a buck a gallon equivalent. So they're seeing much lower fuel bills overall."

Mui makes another argument for government support of the clean car industry: the jobs that come with it. In 48 states, he says, American workers make components for fuel-efficient cars. "These are red states. These are blue states. These are purple states, employing hundreds of thousands of people making technologies not just for clean cars in the U.S., but clean cars globally," he says.

China and Europe are big, regulated markets for electric cars. Mui says lowering the bar for American automakers by dialing back emissions standards would hurt the U.S. competitively.

There are now some 30 models of electric and plug-in hybrid cars available in the U.S. Last year, sales of these vehicles rose by almost 40 percent, but they still only accounted for about 1 percent of all new car sales.

Neil of The Wall Street Journal says that in part reflects a poor job of marketing them.

"The marketing has been terrible, disastrous. It's such a lost opportunity. For one thing, automotive dealers have done a terrible job in the United States of explaining what electric cars are, they don't have them on the lot, so that's hardly their fault," he says. "A lot of these cars fall into a category of compliance vehicles, which are just there to meet the California ZEV mandate."

Neil says he wishes more consumers knew that these cars are "a better way to make mobility."

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ROBERT SIEGEL, HOST:

We don't take note of every new car that hits the market, not even every new electric car, but the advent of the Chevrolet Bolt, the Chevy Bolt EV - EV for electric vehicle - is worth our noting because it could be a game changer. Or more accurately, it could be the first of a new wave of game-changing electric vehicles. I went to the Washington Auto Show to check it out. It's a subcompact that seats five. And what's so special about it? Well, here's Kathy Beslic, advertising and marketing manager for Chevrolet electric vehicles.

KATHY BESLIC: Well, the game changer is the great range of 238 miles on a single charge at a very affordable price. So as Chevrolet, we're very proud to be the first manufacturer to hit both of those.

SIEGEL: Two hundred thirty-eight miles on one charge is a big deal. Until now you only got that kind of range on a Tesla, which costs upwards of $70,000. Tesla's more moderately priced model isn't out yet. The Chevy Bolt, after a federal tax credit of $7,500, starts at 30,000. This is a car that has no tailpipe, so it doesn't pollute the air. You don't change the oil. And as for fuel efficiency - well, the mile per gallon equivalent it says here in the specs is 119 miles per gallon. You would save $4,250 in fuel costs over five years, pretty hard to beat with a internal combustion engine.

BESLIC: That is very true, yeah. Yeah.

SIEGEL: Aside from the environmental benefits, Chevy's Kathy Beslic is quick to talk about other virtues of the Bolt. It's a very high-tech little car with a touch screen the size of an iPad. By designing seats that are thin and upright, GM has managed to squeeze the interior space of a standard car into the body of a subcompact. Beslic is 5'11", and she says she's comfortable in the front seat.

BESLIC: And performance? Once you hit that accelerator, you go. So it's instant torque, very fun to drive. I think it'll put a smile on anyone's face.

SIEGEL: I took a test drive with Toni Rice, who does communications for GM.

I'm now in the driver's seat of the Chevy Bolt. And the display tells me things that I'm unaccustomed to seeing that shows me my battery. I've 181 miles left with this battery charge.

That instant torque they talk about is a feature of electric cars. There's no need for an engine to rev up so it's more responsive to the pedal, and acceleration is smooth. I've been driving for just a few minutes, and the charge has dropped by one mile. We started with 181 miles of charge, and we're now down to a 180 miles. And I understand now what happens to drivers of cars like these where I become obsessed about, oh, it went down to 179 already.

TONI RICE: There's already a phrase called range anxiety.

SIEGEL: Range anxiety?

Range anxiety - GM researched it and found that a battery charge that gets around 200 miles is what people need to ease that anxiety. Less than that and the fear of getting stuck somewhere short of a charging station is an impediment to sales.

So now I'm accelerating up toward 60 miles per hour, 55 - feels very good.

And it's very quiet, so quiet GM actually had to add noise that goes on at slow speeds so that pedestrians can hear it coming.

RICE: Now, to park it there's actually a button...

(SOUNDBITE OF ELECTRONIC BEEP)

RICE: ...And it just pops into park.

SIEGEL: It went into park?

RICE: Yeah.

SIEGEL: Oh, OK. I see, yeah.

RICE: Yeah.

(LAUGHTER)

SIEGEL: OK, all right.

One question about the Bolt and other electric cars is whether the bottom line checks out without some environmental motive weighing in the balance. We stopped some folks at the auto show who were looking at the Bolt. Jack Cheng already drives an electric car, a BMW i3. He's impressed with the Bolt's longer range, less so with its price.

JACK CHENG: I don't know if it's money saving because, you know, for the price of the car versus what you get you probably don't come out ahead.

SIEGEL: For him, the selling point is the environment.

CHENG: I like the fact that I'm not polluting, you know, my son in fact today just remarked to me that, hey, that car that drove by smelled. I said, oh, yeah, you've been used to it because you've grown up with electric vehicles at home.

DAVID MANFREDI: Definitely price is - it's just expensive.

SIEGEL: That's David Manfredi. He's an electrician who drives an SUV, a Toyota 4Runner. He says he wants to cut the cord on oil and gas so he's looking at the Bolt as a possible commuter car. He's also thinking about the Volt, Chevy's plug-in hybrid whose battery is much smaller but can run on gas when the battery is empty. Manfredi says he couldn't consider either car without factoring in the $7,500 federal rebate.

MANFREDI: That's a huge credit. So if that disappears, then I think that we'll have to disappear for the market 'cause right now our price range is in that 25 to 30 range, you know, and that credit keeps us there.

SIEGEL: Which raises some questions. What's the future of electric cars under the Trump administration? Could that $7,500 rebate disappear in a new tax bill? Will Washington continue to spend millions on battery research? And then there's the California waiver. Washington permits California to set stricter emission standards. Nine other states have gone along with Sacramento. They've adopted zero emission vehicle regulations, the so-called ZEV mandate. Automakers have to sell a certain number of electric vehicles, often at a loss, in order to sell profitable internal combustion engine cars. Would electric cars sell if the Trump administration took Washington's foot off the pedal?

DAN NEIL: The consensus is that nobody knows what the heck is going to happen next - nobody.

SIEGEL: That's Dan Neil, who writes about cars for The Wall Street Journal and who has been singing the praises of electric cars to me for years.

NEIL: And the sense of uncertainty is really weighing hard on an industry that is, you know, capital intensive, long term planning. They don't like uncertainty in the auto industry.

SIEGEL: Simon Mui of the Natural Resources Defense Council says government support is still critical to the EV market. He says without subsidies it's likely going to be five or 10 years before electric vehicles are price competitive with gas-powered vehicles.

SIMON MUI: Today with incentives you're very close to that point.

SIEGEL: And electric car prices are dropping. The most expensive part of the car is the battery pack. And with more car sales, battery production is going up and prices are coming down rapidly.

MUI: The drop in battery prices is very similar to what we've seen with solar and wind where it's flipped the market on its head. It's not just environmental groups saying this, it's now automakers saying this, and that's really encouraging.

SIEGEL: The Chevy Bolt battery is not made in the U.S., it's made in South Korea. But Simon Mui says all across the country American workers are making components for fuel-efficient cars.

MUI: These are red states, these are blue states, these are purple states employing hundreds of thousands of people making technologies not just for clean cars in the U.S. but clean cars globally.

SIEGEL: China and Europe are big regulated markets for electric cars. Mui says lowering the bar for American automakers would hurt the U.S. competitively. There are now some 30 models of electric and plug-in hybrid cars available in the U.S. Last year sales rose by almost 40 percent, but they still accounted for only about 1 percent of all new car sales. Dan Neil of The Wall Street Journal says that reflects in part a poor job of marketing them.

NEIL: The marketing has been terrible, disastrous. It's such a lost opportunity. For one thing, automotive dealers have done a terrible job in the United States of explaining what electric cars are. They don't have them on the lot, so that's hardly, you know, their fault. A lot of these cars fall into a category of compliance vehicles that are just there to meet the California ZEV mandate. I wish more consumers knew that these cars are a better way to make mobility.

SIEGEL: But electric car sales are held back by another obstacle - a chicken and egg problem. More people might buy them if they were confident there would always be a charger nearby. And businesses might install more chargers if there were more electric vehicles on the road. Well, tomorrow we'll visit a city where the local utility has taken the lead in breaking that vicious cycle, and it's not in California.

UNIDENTIFIED MAN: There's a little movement afoot here in the middle of flyover country with electric vehicles.

SIEGEL: More about this place tomorrow on ALL THINGS CONSIDERED.

(SOUNDBITE OF ICARUS HIMSELF SONG, "DIGGING HOLES") Transcript provided by NPR, Copyright NPR.