With the Obama administration strongly backing electric vehicles through federal incentives, can the industry overcome the technological and market challenges that are causing lower-than-expected sales figures? During today's OnPoint, Brian Wynne, president of the Electric Drive Transportation Association, discusses General Motors Co.'s response to the Chevy Volt's technical issues and the future of government funding for the electric vehicle industry.
Monica Trauzzi: Hello and welcome to OnPoint. I'm Monica Trauzzi. Joining me today is Brian Wynne, president of the Electric Drive Transportation Association. Brian, great to see you.
Brian Wynne: It's great to be back, thank you.
Monica Trauzzi: Brian, there's been a lot of negative attention on electric vehicles lately with the Chevy Volt encountering some technical issues. Has GM addressed the issue properly so that there won't be permanent damage to the electric vehicle industry moving forward?
Brian Wynne: I think so. I think GM has done a great job and in the spirit that we all have for I this that safety is paramount. And, you know, the thing that consumers need to keep in mind is that we have over a million miles of road experience with these vehicles. The vehicles themselves have garnered tremendously high safety ratings and the Chevy Volt itself, you know, Consumer Reports, it actually won the top prize for consumer satisfaction. So, for those that are driving the Volt, they just need to understand that what's being reviewed right now is an after-test crash matter. And I think consumer education, as with this technology in general, is really going to be very important.
Monica Trauzzi: The House Oversight Committee has alleged that perhaps the Obama administration has not divulged all the details of their investigation into what's happening with the Volt. Do you believe that the administration has backed electric vehicles so staunchly that they would be willing to maybe cover some of those details up?
Brian Wynne: I sincerely doubt it and Secretary LaHood, I think, addressed that the other day. The key thing here, again, is that this is a multi-industry effort. The automotive industry is treating these vehicles the way it's treating all of their vehicles with putting safety first. And so I think the thing that people need to continue to focus on here is what's the vehicle safety here? What kind of safety regulations are in place here for the batteries? And the batteries and the battery packs have been thoroughly tested with these vehicles. In play is a matter after a safety crash, a crash test weeks after that test. We're trying to get to the bottom of exactly what happened to that and we're crash testing battery packs now to make certain that we understand that when those battery pack fail they fail safe. So, you know, there have been no on road, real-time incidents in this regard and, essentially, this is what we pay NITSA to do.
Monica Trauzzi: This administration has been very aggressive in its support of electric vehicles. Sales figures, however, are much lower than predicted. In some cases we're seeing 40 percent lower values than what was predicted for this year. How would you qualify the state of the electric vehicle industry at this point?
Brian Wynne: I think we're looking out of the wrong side of the binoculars right now. You know, this is a rollout, a very successful, I think, rollout of the newest configuration of electric drive. Actually several configurations, because you've got pure battery and you've got battery range extended essentially or plug-in hybrid. So, these are the newest vehicles that plug into the grid. We only started this a year ago. We're going to deliver somewhere between 17 and 18,000 of these vehicles. Nissan is delivering an additional 10,000 worldwide. The bigger story too is in addition to the vehicle numbers, is that we've stood up an entirely new, highly capital intensive battery industry for lithium ion batteries, almost from a standing start. In 2009 was estimated that the United States could produce about 2 percent of the world's lithium ion batteries. The estimate now for a couple of years hence into the future is 40 percent of the world market. That's a huge win for the country and for this particular industry, because batteries are key not just for the vehicles, but also for a clean energy infrastructure in the future. And the last point to bear in mind, just going beyond the vehicles, is we've installed about 5000 public chargers to plug these vehicles in, in public, and probably double that in terms of private infrastructure as well. So, there's an awful lot of activity here that, you know, that we need to, again, you know flip the binoculars around and make sure that we're looking at the right picture.
Monica Trauzzi: The industry though has been pretty reliant on government support, government funding, incentives. Are taxpayers going to see a return on the investment that they have made?
Brian Wynne: Absolutely and private investors are going to see a return on that investment as well, because the federal investment is essentially following much larger private investments by the companies themselves, again, on the vehicle side as well as on the infrastructure side. The thing to bear in mind is what is the challenge that we're trying to address here as a country, that warrants the federal policies that we've been successful on a bipartisan basis in getting into law? And, you know, Americans paid $448 billion for gasoline this year. That's $100 billion more than we paid in the last year. Think of what we could do, think of what that's doing to our economy. The question is not are we going to get a return on our investment? It's how fast can we get a return on the investment? We're getting a return on our investment immediately with people going back to work on the latest state-of-the-art technologies for automotive and for infrastructure. That's key to bear in mind and then this is, again, just the very beginning of the latest configuration of electric drive.
Monica Trauzzi: But can the grid even handle a large influx of electric vehicles on the market?
Brian Wynne: Well, you can't have it both ways. Now, you know, we're ramping this thing up, so people will focus on small numbers. Absolutely we can handle those small numbers. Northwest Pacific National Labs did an estimation that we could fuel 73 percent of the existing light-duty fleet with off-peak kilowatt hours. That's capital that you and I have paid for through our utility bills that's sitting there underutilized. More to the point for the American taxpayer, this is energy that's produced from domestic feedstock. So every time we can shift from petroleum, a gallon of gasoline to electricity, which by the way is cheaper than gasoline on a mile per mile basis, we're keeping our energy dollars in this country. That's enormously significant and there's a huge capacity available on the grid for that.
Monica Trauzzi: Aptera recently went out of business and many questions have been raised about the role of government loans in propelling the EV industry forward. How reliant is the industry on these loans and do you risk possibly getting into a Solyndra-like situation with the EV industry? How concerned are you about that?
Brian Wynne: Well, as far as I know, Aptera didn't take any loans. So, yeah, there's going to be market adjustments as we go forward here. There will be winners and losers. It's a new technology. I think the importance of battery manufacturing, that's really critical to continuing the ramp that we need not just on the vehicle side, but also for stationary storage as well. So, we think there's, you know, there's a market for those batteries, whether they be in the vehicles, and that's a growing market, or in the infrastructure, and that too is a growing market. At the end of the day, again, you have to telescope out to what is the timeframe in which we're looking to get a return on our investment? How do we accelerate that return on the investment? And let's not forget that, you know, what's at stake here is moving people and goods in this country and we're highly dependent upon one fuel. We need fuel diversity and we get that with electricity in a big way.
Monica Trauzzi: All right, we'll end it there. Brian, nice to see you. Thanks for coming on the show.
Brian Wynne: Nice to see you too.
Monica Trauzzi: And thanks for watching. We'll see you back here tomorrow.
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