Consultant

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Chloe Mark 10/22/2014 CAT – Professor Berk Assignment # 5 – What caused the demise of the electric car? In the 1990s the electric car was never really alive In 1987 when the Sunraycer won, Roger Smith saw the potential for a commercial electric vehicle (EV); only 3 years later, GM announced the Impact prototype. CARB, emboldened by the seeming viability of EVs, quickly passed ZEV mandate. It seemed the EV was making rapid in-roads. However, 13 years later ZEV mandate was reversed and nearly all electric cars produced were destroyed by their own manufacturers. This stark turn of events begs the question – Who is to blame? When we go back over the facts, it becomes clear that ultimately limited and cost-prohibitive technology…show more content…
Although Who Killed the Electric Car focuses on ~50 enthusiasts there is no consistent evidence of high potential demand for the EV1. GM made a rational business decision to close down the EV1 At a price point of $50-60K with poorer features than traditional cars demand for the EV1 would be extremely low, and it is unclear whether the EV1 would have ever reached enough scale to be profitable. Given these conditions, it is not unreasonable that GM would discontinue the EV1. Other factors While the demise of the EV was largely a function of viable technology there are several other contextual elements worth noting. Firstly, the decline of oil prices in 1996 decreased the price of substitutes to the EVs and increased demand for traditional cars. In addition, the oil lobbyist’s blocking of recharging infrastructure limited important complements for a viable EV market. Secondly, CARB’s production requirements contingent upon demonstrated demand created a perverse incentive for car manufacturers to suppress demand for their vehicles if they believed that consumer demand (at a profitable price) would fall below CARB’s mandated levels. The impact was that even if the EV was not viable at the time, manufacturers were encouraged to stop exploring improvements to make the EV viable in the future to avoid signaling a future demand to CARB. Viable EVs, but CARB should be careful
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