Automakers charge ahead with EV sales

David Shepardson and Melissa Burden
The Detroit News

New York — Automakers are moving full-speed ahead building electric vehicles to meet government zero emission vehicle mandates despite sagging sales.

At the New York International Auto Show, automakers said they were moving forward despite low oil prices. Daimler AG’s Mercedes-Benz USA unit unveiled a new plug-in GLE 550e with the electric drive train from its S-Class. By 2017, Mercedes-Benz will offer up to 10 EVs and plug-in vehicles.

“I don’t know how you can meet the regulations in terms of emissions without electric vehicles. I think it is going to get stricter and stricter — I don’t think it’s going to get looser,” said Renault-Nissan CEO Carlos Ghosn Thursday at the show. “Zero emission is here to stay.”

Many of the dozens of new EVs that have gone on sale have been sold in very low numbers — and often only in California — and other states that have required automakers to sell a growing number of zero emission vehicles. Automakers have been forced to cut prices and offer heavy discounts to sell EVs, even with $7,500 federal tax credits and state incentives.

Nissan has the best selling electric car — the Leaf. But it has fallen far short of Nissan’s early aggressive targets. In January Nissan canceled a planned Infiniti EV. Ghosn acknowledged EV sales were “a little bit disappointing” globally compared to forecasts. Leaf sales topped 30,000 in 2014, up 33 percent, but are down 22 percent this year.

In 2009, Ghosn predicted that electric vehicles could account for 10 percent of Nissan’s sales by 2020 — a forecast he later abandoned. Asked for a new forecast of when Nissan would hit that figure, he declined to answer. “I think we have to be patient.” He blames the lack of recharging infrastructure in part for delay.

He said Nissan was confident it would have enough demand for at least 50,000 vehicle batteries from a Tennessee battery plant that was financed through low-cost U.S. government loans. He says some automakers will buy EVs from other automakers.

General Motors Co. isn’t continuing its Spark EV with the next-generation 2016 Spark, revealed at the New York auto show.

The Spark EV will be available for a time in its current body style, a Chevrolet spokeswoman said. General Motors Co. sold 1,146 Chevrolet Spark EVs last year and 356 through March.

GM plans to replace the Spark EV with the Chevrolet Bolt, a pure electric, five-passenger car with double the range of the Spark EV that will be sold across the United States. A new plug-in hybrid Chevrolet Volt goes on sale in September.

The Spark EV is sold in three states — California, Oregon and Maryland. GM North America President Alan Batey said GM has been happy with sales of the Spark EV. “This one was really produced so we could meet some (zero emission) requirements that were out there in these surf states,” he said.

Cadillac also will offer a plug-in electric version of its Cadillac CT6 luxury sedan that GM showed at the New York show. It will be unveiled at the Shanghai auto show later this month.

On the sidelines of the show, a group of automakers met with officials from states that are requiring a growing number of zero emission vehicles by 2025.

Audi AG touted its A3 Sportback e-tron plug-in hybrid that will go on sale this year. Audi of America President Scott Keogh said in an interview that regulations will prompt a huge flurry of EVs.

“As you get out to 2025, you need to have about 25 percent of your business need a full battery electric vehicle,” Keogh said. “Directionally that’s where we see all of the companies are going to need to get to.”

BMW North America President Ludwig Willisch said industry EV sales remain spotty. He noted that there are areas like New York City “where people couldn’t care less” about EVs. He said he thinks the market will remain stable this year. “I don’t think it will be exploding anytime soon,” Willisch said in a Detroit News interview this week.

He said regulations will drive EV sales in Europe and the United States. In some parts of Europe, drivers can only enter in a zero emission vehicle. “If you could only get into Manhattan with a zero emission vehicle ... that would really drive electro-mobility,” Willisch said.

Energy Secretary Ernest Moniz told The Detroit News in January the United States will not meet President Obama’s goal of getting 1 million electric vehicles on the road by the end of this year, and said hitting the target could be a few years away. “We’re going to be a few years after the president’s aspirational goal of the end of 2015, but I think that we are within a few years of reaching that goal,” Moniz said.

Chrysler brand chief Al Gardner is blunt about why the company is building a plug-in hybrid Chrysler Town & Country minivan.

Regardless of gas prices, Fiat Chrysler needs to build plug-in hybrid and other advanced technology vehicles to meet rising fuel efficiency standards. Fiat Chrysler, according to an Environmental Protection Agency report last week, remained the least fuel efficient major automaker and purchased fuel economy credits from Tesla Motors Inc. to help meet requirements.

Ghosn said Nissan sold a lot of emissions credits this year, but he didn’t say to whom.

“The federal government will mandate in no uncertain terms what you will and will not build or you will not sell cars in this country,” Gardner said this week. “There are multiple reasons why you do it but the number one reason is you have no choice. We’ve got to figure it out and hurry up and get on with it.”

Other automakers are focusing on hydrogen fuel cell vehicles. Toyota Motor Corp.built an all-EV RAV4 — selling about 2,500 over three years in a partnership with Tesla — but ended production and has no plans to build any new full EVs in favor of hydrogen fuel cell vehicles.

Hyundai Motor Co. is focused on fuel cell vehicles. It leased around 70 last year in the United States and plans to lease slightly more this year. The technology is hindered by a lack of hydrogen refueling stations. Hyundai’s U.S. chief Dave Zuchowski noted that despite interest in the vehicles, Hyundai has only been able to approve about 10 percent of those who sought to lease a fuel-cell Tucson because of their location.

DShepardson@detroitnews.com