GM Slashes Prices for Its Electric Vehicles (To Compete With Tesla)

“How much of this innovation and aggressive price-slashing is due to government intervention in the clean energy market? It’s hard to tell. E.V. sales have long been boosted by government subsidies that offer electric and hybrid vehicle owners federal income tax credits of up to $7,500 for new cars bought in or after 2010. But in a splendid twist of government logic, carmakers also get punished for being too successful, since customers are phased out of subsidies if the automaker has sold more than 200,000 qualifying units—a threshold Tesla has reached, rendering owners ineligible for tax rebates. Tesla CEO Elon Musk has even criticized such tax credits, noting that they’re simply not needed in order to drive demand for E.V.s. Though likely correct, Musk delivered this critique years after the subsidies were put in place and after his company’s customers became ineligible for it. It’s entirely possible that tax credits helped drive the early transition to E.V., but play less of a role now, and will play no role in the future.

In May, the Biden administration signaled that it would incentivize further E.V. adoption—pursuing ill-advised and market-distorting economic nationalism despite the fact that consumers were already gravitating in that direction (as strong Tesla sales, even post-subsidy-expiration, have suggested, and Musk has confirmed). The administration last month started to put in place a $3.1 billion plan to ramp up domestic production of E.V. batteries. Though packaged as a way “to insulate consumers from the fluctuation of global oil markets,” as The New York Times reports, gesturing at Russia’s war in Ukraine, the shift to mass domestic production of E.V. batteries will take quite a while to implement, and the effects even longer to be felt. It also ignores that much of the lithium, cobalt, and nickel mining needed for these batteries is done in China and will be difficult to scale up to sufficiently meet demand.

Mass electric vehicle adoption need not be spurred by socially conscious word-fluff or well-meaning (but flawed) subsidies; it’s looking like customers want electric vehicles because they’re high-quality, convenient products made increasingly attractive by their lower price and easier maintenance. May the best man win in the coming price wars.”

The death of the gas station

“While some gas stations have taken the leap and installed charging ports alongside their pumps, people tend to do the lion’s share of their EV charging at home. And since EV chargers can be installed in almost any location that’s connected to the power grid — they’re now available in office garages and rest stops, and will soon be in some Starbucks parking lots — the gas station is increasingly unnecessary for some Americans.”

“To adjust this business model for the EV era, some gas stations are now installing Level 3 chargers, which can deliver as much as 20 miles of range per minute, alongside their old pumps and convenience stores. Some of these fast chargers make EV charging almost as speedy as filling up a gas tank the old-fashioned way, and they’re much faster than what people typically use at home. Several gas station owners who have or are installing Level 3 chargers told Recode that their goal is to become “fuel agnostic” and appeal to EV drivers as well as those with gas-powered cars.

But for many gas stations, the cost of an EV charger outweighs the benefits. The charger itself can cost tens of thousands of dollars, which is a tough expense for a small business. The overall cost can be much more, since installation often involves drilling through asphalt and laying electrical wiring, and sometimes gas stations also need to buy transformers to boost the overall electrical capacity of their sites. Chris Bambury, who operates several gas stations in California, told Recode that setting up just four EV chargers at one of his locations would have cost about half a million dollars if government and utility programs hadn’t covered about 90 percent of the bill.

An even bigger challenge is that gas stations already face intense competition from other public EV chargers. Data collected by the Department of Energy shows that, of the public charger locations the agency fully tracks, there are currently more public chargers located at hotels and inns, shopping centers, and government buildings than there are at gas stations and convenience stores. This is a limited picture of the nation’s charging network, and it doesn’t include the large number of chargers built by private companies like Blink, Electrify America, and Chargepoint. These companies also seem to prefer installing these chargers in places with parking spots connected to the grid, where EV drivers can find something to do while charging, like go to a grocery store or a restaurant.”

“But perhaps the biggest obstacle facing gas stations: Charging an electric vehicle is often as simple as parking it. Many EV owners buy chargers that plug into a standard home wall outlet just like their laptop or phone, and that virtually eliminates the need for frequent refueling trips. These are typically less expensive Level 1 chargers that take a few hours to fully recharge a battery, which is perfectly acceptable for charging a vehicle overnight. And since the average EV can travel 260 miles on a single charge, most people only need to plug their cars in once a day.”

“even if gas stations do install fast chargers, people who are traveling long distances may be their main customers. This situation is already playing out in Norway, where about 90 percent of new cars sold are now electric or hybrid. While gas stations have moved quickly to install charging ports, many EV drivers in Norway are only visiting them on a monthly basis.
The rise of EVs could actually lead to a new generation of pit stops. Some private companies, for instance, are opening their own luxurious destinations with multiple charging stations. Electrify America plans to open a series of flagship, EV-focused travel lounges with solar canopies and event spaces that could possibly offer valet services and curbside deliveries in California and New York later this year. Automakers are also experimenting with the idea of premium charging stations. In California, Tesla has already opened a charging hub for its vehicles that incorporates a lounge, an espresso bar, and free wifi. Porsche and Audi are developing similar plans for stations of their own.

None of this is necessarily surprising. New innovations often make old technology obsolete. After all, the phasing out of travel by horse also meant the demise of the horse-drawn carriage industry and the repurposing of stables. Now, after a century spent building complex infrastructure around gas-powered vehicles, another transition seems inevitable. This means that EVs aren’t just transforming the kind of cars people drive, but also where they take them.”

The downside to Biden’s electric vehicle charging plan

“to build 500,000 chargers with half the budget, the Biden administration will have to opt for slower chargers. (The faster the charger, the more expensive it is to install.) The Biden administration’s plan, which draws on funds from the recently passed $1.2 trillion bipartisan infrastructure bill, prioritizes chargers that take hours to fully charge an electric car — a potentially hard sell for Americans who are used to filling gas tanks from empty to full in minutes. And while more chargers are great, the plan is an indicator of just how watered-down Biden’s energy policies have become over the last year. Democrats still haven’t been able to agree on a clean energy plan, and without one in place, those EV chargers could just end up getting their energy from fossil fuel sources.”

“There are currently three different types, or levels, of electric vehicle chargers. Level 1 chargers plug into a regular 120-volt power outlet and deliver power to electric cars at a glacial three to five miles of range per hour. At that rate, it would take a couple of days for most cars to go from empty to fully charge. Level 2 chargers convert the 120-volt connection to about 240 volts, charging cars around 10 times faster than Level 1 chargers and bringing a battery to full within a few hours. Level 3 chargers, also called DC fast chargers, are the fastest of the lot. They add anywhere from three to 20 miles of range per minute.That means your car can be about 80 percent charged in the time it takes you to use the bathroom and grab a cup of coffee at a rest stop.”

“industry experts say, we don’t really need every charger to be a fast charger — which is why the Biden administration’s charging framework just might work.
“There’s a temptation to recreate the gas station model, where we say, ‘Oh I’m low on fuel, I need to go fill up now and be on my way in five minutes,’” Joe Britton, executive director of the Zero Emission Transportation Association, told Recode. “That would be a mistake.” (Just don’t tell Harris, who said charging the Volt was “just like filling up your car with gas.”)

Instead, Britton said, it’s important to consider how most people actually use their cars on a regular day. Most folks aren’t driving hundreds of miles each day; they’re driving between home and work or running errands around town. For those folks, Level 2 chargers would work just fine. They can charge their cars at home, drive to a grocery store, plug in at the parking lot, and drive back home with a full battery. So while the Biden plan does include strategically installing faster chargers along highways and in rural areas, the focus on building lots of Level 2 chargers in local communities is a way to stretch that $7.5 billion a long way.”

“Despite being home to EV pioneers like Tesla and GM, the US lags far behind Europe and China in electric vehicle sales. The majority of American EV sales are also concentrated in major metropolitan areas, with nearly half of all EV sales in California alone.”

“Studies have shown that electric cars drawing power from coal-heavy grids can actually be worse for the climate than hybrids. And so far, the president’s attempts to clean up the grid have been repeatedly thwarted by Senator Joe Manchin of West Virginia, who single-handedly gutted a proposal to replace coal- and gas-powered plants with solar, wind, and nuclear energy. Most of the energy policy that remains in Biden’s signature Build Back Better bill revolves around tax credits for clean energy, with few penalties for continued pollution-heavy energy production.”