Buy the car. Lease the battery.
Is this the way to sell PHEVs and EVs?Quite regularly, I am contacted by people inquiring about the reliability of the batteries in hybrid cars. As the auto industry moves further towards the electrification of the auto, the importance of batteries will increase significantly.
Would a battery lease be the best way to handle this issue?
Bob Lutz has already suggested such a plan for the Chevy Volt, for instance. Likewise, GM is already contemplating what to do with used batteries, which would still retain some, or even much, of their capacity. Thus, even after an EV is retired, the battery might still be valuable. Considering the considerable upfront costs of this technology, could leasing help spread that cost?
Buy the car. Lease the battery. Is this a business model that you would accept?
Labels: electric cars, Hybrid Vehicles, plug-in hybrid vehicles
posted by Dahcredyns at
8:47 AM
7 Comments:
I don't like it. Seems like another way that consumers are getting screwed over. So, your car will be in the junk yard - fully bought and paid for, but you might still owe on the battery? Not for me.
Yes! In 5 years I buy a new Volt compatible lithium battery for $2000 that gives twice electric range.
GM takes the old battery to reuse somehow. Maybe GM's suppliers can rebuild them or what have you, and then GM can use them for warranty repairs or something.
Or maybe all those old Volt and other hybrid batteries can be redeployed by utilities as part of solar farms to store energy overnight. Utilities won't care as much for absolute reliability as for numbers, and they would be better able to manage the batteries anyway.
Denise Gray is GM's Advanced Battery Director.
http://gm-volt.com/2008/08/15/gms-advanced-battery-director-denise-gray-is-keeping-her-eyes-on-the-future/
She said this, "the battery is the underpinning of a major transformation taking place in the automotive industry and particularly at GM."
I've met Denise a few times, she's a cool lady.
I was part of a conversation with A123's CEO about using lithium for solar farms, and he didn't see it as being cost-effective, at least not yet. Plus, the batteries, in order to store enough power, would require a significant amount of space. Obviously, that could change over time.
Plus, there is a lot of interesting research coming out of MIT right now regarding solar storage, and batteries might not even be needed.
So, who knows what the future will bring.
I think the lease idea is an interesting idea, but I think there are a lot of variables. Inevitably, I think used Volt batteries will be worthless to anything but recyclers. The technology will just move to quickly, especially if something like Moore's law occurs.
I've had plenty of old computers that worked just fine, but i still replaced them and just recycled the old ones. The technology just moves too fast.
I get the feeling this will happen with batteries and electric vehicles as well. Certainly, leasing will probably work in the short term, but I don't think its the future.
Wouldn't leasing batteries be smart for the consumer if battery advances really speed up? Lower upfront costs and a commitment from GM to take the worthless batteries back, which allows you to really add value to your Volt with the greater range of the newer batteries?
I ask because I don't know much about leasing so I'm not sure about the potential for savings.
it could be, but leasing has lost favor with automakers because the value of most used automobiles has depreciated too much. automakers will only offer consumers favorable leases on such batteries if there is an asset at the end of the lease.
in the short term, automakers will probably offer leases, but in the long term i don't think they will like the model. just because as battery technology advances, old batteries will be a worthless asset in my opinion, except for recycling.
thus, automakers won't make it easy to swap batteries - at least not cost-effectively.
on the other hand, many believe that EVs will last forever and consumers will just swap batteries, but i don't believe so. however, if such a model is the future, leasing works great.
still, i think the EV revolution will completely change the automobile. it will lead to carbon fiber bodies, for example, which will drive consumers to want new autos. new vehicles will offer new electronics, new safety features, etc. ultimately, new technologies might make new EVs two, three or more times more efficient than previous generations.
since the cost of electricity is going to go up significantly in the future, these changes will matter. thus, rather than swap your leased battery, you'll probably prefer a new car to go with that battery.
can you predict how many hybrid cars
will be sold world wide in 2009?
i'm not sure what this prediction has to do with this topic, but i'll guess as many as are made will sell. as for that number, most manufacturers have made it pretty clear roughly what their production will be.
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