2018 will be the year of the electric car

In 2018, electric cars will finally turn the corner from curious niche product to become a viable option for America'...

Posted: Dec. 21, 2017 2:44 PM
Updated: Dec. 21, 2017 2:44 PM

In 2018, electric cars will finally turn the corner from curious niche product to become a viable option for America's families. Next year will mark a turning point in the ultimate electrification of America's roads.

Electric cars will still only make up just 1.5% of all U.S. auto sales according Navigant Research. But, for EVs, the really important numbers to watch are price, driving range and availability.

Americans will finally be able to buy reasonably affordable and widely available electric cars that can hold enough power to breeze through their daily routines with no worries. Cars like the Chevrolet Bolt EV, the redesigned Nissan Leaf and the Tesla Model 3 will begin to strip away the "trust issue," as Kelley Blue Book analyst Rebecca Lindland terms it.

Electric cars are far simpler, mechanically, than internal combustion cars and should be more reliable. But it will take time for people to realize that they aren't going to freeze up like their smart phones do, she said. Seeing more electric cars on the road in large numbers will help ease those fears.

Next year will be the first full year that the Chevrolet Bolt EV will be available nationwide. But it's already been a clear marketplace success. Already more than 20,0000 have been sold. And it wasn't even available in all 50 states for most of the year. Prices for the Bolt EV start at about $37,000 and it has batteries that can take it an estimated 238 miles.

The redesigned Nissan Leaf is also just entering production. For now, the Nissan Leaf isn't going head-to-head against the Bolt EV, since it doesn't go as far -- only 150 miles on a charge. But it also doesn't cost as much, with a starting price in the U.S. of under $30,000. A version of the leaf that will be closer to the Bolt's range and price is expected to come later.

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The Tesla Model 3, with a starting price about the same as the Bolt EV, was supposed to be leading the charge for the mass-market EV. But something went wrong. Tesla has struggled to make the car -- only 260 had been produced as of October. That's given GM a long lead in the marketplace.

Still, if it can get its production troubles behind it quickly enough -- something that remains far from certain -- Tesla could handily outsell either Nissan's or GM 's electric cars, despite Tesla's far more limited dealer network.

Over 400,000 people have already paid refundable deposits to buy a Model 3. Sam Abuelsamid, a transportation analyst with Navigant Research, expects more than half of those people will ultimately back out when they learn how much options cost, and about what he describes as the car's awkward interior controls. Even then, the Model 3 would be well positioned to take the lead in sales.

Tesla has two advantages. First, there's the allure of the Tesla brand band. KBB's Lindland, who holds a reservation for a Model 3 herself, said she'd never consider the Bolt EV despite the fact that she knows it's at least as good.

"There is a mystique about Tesla," she allowed.

The other factor is that Tesla's dealer network, while paltry compared to Chevrolet's or Nissan's, is far more effective at selling electric cars. Salespeople at mainstream auto dealers often push customers interested in electric vehicles toward gasoline-powered models, according to a recent study by the marketing research firm Ipsos.

Each of these three cars are helping to change consumer attitudes about EVs. Tesla has transformed the idea of what electric cars can be, making them intriguing and desirable. The Leaf and the Bolt EV show that these cars are accessible -- they can be purchased from the same dealer that sells you a pickup truck, not just from a start-up car manufacturer.

One remaining wrinkle is the $7,500 federal tax credit that manufacturers are counting on to help sell these electric cars. That incentive survived the Republican tax overhaul but the full credit is only good on the first 200,000 electric cars sold by each automaker. And GM, Nissan and Tesla are expected to hit that number some time next year.

Maybe by then enough people will have changed their minds, and electric cars will be able to stand on their own.

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