The future is electric – DUH!

A year ago I bought myself a nice new 4 cylinder petrol car with all the mod cons. I’ve driven 8,000 kms, which divided by the number of work days (it really only takes me to work and back, plus the odd meeting) is 32 kms a day. The average car commutes 55 kms a day, and already we have electric cars on sale in this country that can do 160 kms on one charge. Charge the thing at home. Little or no cost (especially if you have solar power), no fumes, no noise, no pollution. Why aren’t we all driving them already?

Hybrids like the Prius are not the answer. Yes, you have a battery and save some dollars on petrol, but you are still carrying around a petrol engine and all that petrol. The extra weight is self defeating. Surely we should all be driving pure electric cars, no moving parts (apart from the wheels), a long battery underneath you means there’s more room (no engine!), it’s lighter (better performance), whisper quiet, no emissions (at all!) and it costs a tea spoon to run.

The reason we are not doing this is due to a few factors: inertia, the power of the incumbents (the car companies and the big oil companies) and price. History of markets show that no matter how dominant you are in a market, if the market changes on you, you are powerless. So I am not bothered about big oil and the car manufacturers. We’re never going to be making cars ourselves, so the car companies will be alright. Oil is not a good product and will run out anyway one day. It’s price. And then we will start to shift.

The Prius (apart from being a dog of a car) is expensive, and looks plain awful. People do not buy a vehicle to take them from A to B, they buy something that fits their  lifestyle and adds to their self image. For a time, being environmentally friendly was ‘in’, so some people took to Prius. But, in the end, in these days of sharply rising energy costs, the hip pocket will rule. Electric cars have to come down in price, and they will only do that by volume. Economies of scale. They have to sell more of them. Sadly, in Australia, despite more hybrid options, sales of them FELL 10% last year. But, as we know, hybrids are not the real deal.

The i-MiEV (“Mitsubishi’s innovative Electric Vehicle“) went on sale in Australia last year, with severely limited stock, for just under $50k. The first real all electric car. It was only available initially on leasing terms ($1,740/mth for 36 months) and in August 2011 had its public launch. They expected 5 sales a month. By December 2011, they had sold 27 in the country (5 a month!). At this rate, it will hardly make any dent, and as of now, electric cars and hybrids don’t even make up 1% of total car sales.

The arguments for a move to electric cars are so all pervasive. I have never been as sure about something than I was about the internet shifting classified advertising away from print (which persuaded me to set up an internet business back in 1999). But the internet advertising was, and is, way cheaper than print. Except initially, with less viewership, it did not deliver, but within a year or two it swept over the offline offerings. With a few years it crossed the $1bn threshold in Australia, only to double this by 2010, and is set to double again to $4bn by 2014, where it will be largest advertising medium of them all.

Looks like my next car will be electric – all I really do is drive to work and back, and my wife has a lovely big Mazda 6 wagon, which we use for longer trips. Lead by example, that’s my motto. i-Miev here I come. Still, it is almost $55k on the road, and all you get is the equivalent of a $16,000 petrol 4-door hatchback…

About the author

Charlie has spent more than 20 years in Perth’s tech and startup sector, firstly as a founder himself, through to exit, and more recently as a writer, advisor and investor. Originally from the UK, Charlie worked in Singapore before arriving in Perth in 1997 to do an MBA at UWA. Graduating as top student in 1999 he set up online real estate business, running it for 10 years before selling to REIWA, whereupon Charlie ran In 2013, he moved to Business News to lead their digital transformation as CEO, and then worked for the federal government’s Accelerating Commercialisation program, funding pre-revenue startups and innovative businesses. He now works in an advisory capacity for multiple tech and other businesses, is managing editor of Startup News and co-host of the Startup West podcast. He also writes a column for Business News on startups. Charlie sits on the advisory boards of WA Leaders, TEDxPerth, WAITTA, the Perth Symphony Orchestra, and the full board of Rise Network.

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