Can the Electric Car Survive?

Yet the electric-car industry remains uncertain as to where it is situated in the innovation cycle. The other side of the valley of death?to be reached at the earliest when the next generation of lithium-ion batteries lowers the price of electrified cars?is at least three to five years in the future, industry hands believe. At this point, electrified vehicles can begin to seriously close the price-and-performance gap with gasoline-driven cars, allowing them to commence a long ascent toward a mass consumer market. But until that starts, one must survive.

So how can companies end up like Thomas Edison and avoid the fate of his commercial failure rival?Nikola Tesla, a legend only in death, and the namesake of Musk?s electric company?

Musk?s solution is to grapple with the market currently at hand. In the case of electric cars, there is no mass consumer market as yet. So he has sold out a niche $109,000 sports car and begun to work his way gradually down the pricing scale. Electric cars are following the long innovation-and-commercial arc of cell phones, asserts Ricardo Reyes, Musk?s vice president of public communications. ?[Cellphones] were almost prohibitively expensive at first,? Reyes told me. ?You had some adoption by early adopters, initially wealthy folks. As technology went up and price went down, market demand increased. Now you have everyone with a cellphone in their pocket.?

The danger is that both Musk and Raney, the former Honda executive, are right?electrified cars do take off relatively soon, but for a long time only as a niche product. If that is the case, one might call the electric vehicle crowd the latest Martin Cooper.

Cooper invented the cellphone. In 1973.

Source: http://feeds.slate.com/click.phdo?i=c3638adb651c935f8473130ec5ea9f00

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