VW's e-Golf aims for slice of US e-car market

Electric vehicle (EV) sales are continuing to grow steadily in the US. During the first half of 2014, more than 54,000 EVs moved off the lot - a 33 percent increase from last year.

The industry has been experiencing a second wave of interest in the past several years, said Chelsea Sexton, an advisor and consultant in the field for almost 20 years.

"The first electric car of the last generation was the General Motors EV1. It was announced in 1990 and went to market in 1996," Sexton said, pointing out that the US has been at this for quite some time.Other automakers followed suit in the 1990s.

"It was a nice, well-loved, but very brief generation of cars available back then," Sexton said. It's déjà vu perhaps, "but with a lot of energy and attention paid to the industry this time," said Sexton.

Since 2010, about 250,000 electric cars have been sold in the US, according to the online industry magazine "Inside EVs." The number was far below the aims of US President Barack Obama, who announced in 2009 to bring a million EVs to US streets by the end of 2015.

One reason is the size of the country. Since the US is the third biggest nation in the world, electric batteries can't handle the long distances traveled by car - at least, for now.

"Technically if you'd tried really hard, you could drive one cross-country, and occasionally someone does," said Chelsea Sexton, laughing.

But modern EVs were not meant for that, Sexton believes.

"Today they are like microwaves. You use the microwave every day, but you wouldn't cook your holiday meal in it." Sexton is confident this will change over time, as battery technology becomes more advanced.

Tesla has whetted appetites

As US carmaker Tesla became more popular in the US, consumers became more interested in the topic. Tesla Chief Elon Musk fits into the hip IT start-up culture and comes across as a visionary. Sales of Tesla's Model S sells continue to increase every quarter, and company shares have risen around 70 percent this year.

But the high prices don't make the Model S affordable for the masses, critics say.

The market leader in terms of sales is the Nissan Leaf, followed by the Chevrolet Volt and the Toyota Prius. But German automakers aren't worried.

"I don't think that we are behind, first of all. I think we are right out there," said Douglas Skorupski, product strategy manager with Volkswagen of America. "Let's be honest, we always come to market when we have it figured out."

The e-Golf will be launching with the help of dealers in California, Massachusetts, Connecticut, Oregon, Maryland, Rhode Island, New York, New Jersey, Maine and Vermont. The governors of most of these 10 states agreed last year to a target of bringing 3.3 million zero-emission vehicles on the roads by 2025.

These states not only account for more than 25 percent of the US car market, they also provide the cleanest, greenest electricity mix in a country where green energy is by no means the norm, according to Nic Lutsey from the International Council on Clean Transportation.

The US Midwest primarily uses coal as its source of fuel - with the black rock having at least a 60-percent share in the mix of fuels to generate electricity.

"You start to get to numbers, like 70 percent, 80 percent coal," Lutsey pointed out.

Thus, the overall carbon balance of an EV would become similar to a gasoline or diesel-powered car, making the US market a double-edged sword.

"There are many ways to be a very clean electric automaker," said Lutsey.

E-cars vs improved technology

Diesel or even gasoline cars could run more cleanly with better engines and more efficient transmissions, Lutsey said, adding that these measures would make a bigger environmental impact within the next 10 years than EVs. But industry consultant Chelsea Sexton is confident that this current wave of interest won't fizzle out. She compares electric cars to other new technologies, like smartphones.

"A decade back, no one looked at their original cassette player and said, 'I wish I could watch TV on it and use it as a phone,'" she said.

But when the smartphone became popular, people realized they wanted something they previously did not know of and therefore did not miss.

"Once consumers see it is possible, once they have a chance to drive an electric vehicle and get a sense of the experience, it becomes a much more compelling case," Sexton said.

But to compete with the current cars on the market, the industry would need to introduce a bigger variety of EVs.

"We need cars for folks who need different sizes or want an EV versus a plug-in hybrid. We need different ranges - all of those sorts of things," Sexton said.

The e-Golf, which will be available in the US as early as this month, would create at least one more option for consumers.