Fast development for electric cars
OPINION: Last weekend I came across my old Nikon F3 camera while cleaning out some cupboards.
Back in the day, the F3 was the 35mm camera of choice for photojournalists. Matched up with the 105/f2.8 manual lens, it was considered top shelf kit for anyone shooting portraits. It was also built like a brick outhouse.
On a whim, I decided to buy a roll of Ilford FP4+ film so I could show my kids how to develop and print film. At least that was the idea.
Turns out about the only place that has a ready supply of FP4 is Photo and Video International in Christchurch which caters for the diehard enthusiasts, the artists and dinosaurs like me.
The first consumer digital cameras started selling in New Zealand in the mid 1990s. By 2003 they were outselling film cameras. And now, 14 years later, the chances are you won’t know a person who owns one – other than as a valueless paperweight.
It strikes me that we are currently immersed in a similar journey in respect of electric cars.
Seven years ago the nice folks at Mitsubishi loaned me an iMiev electric car. It was tiny, tinny and couldn’t do much more than 100 kilometres between charges. It was also worth about $200,000.
Today I know several people with proper electric vehicles (EVs) and three businesses that use them. More importantly, you can buy one for around $70,000 new and travel more than 190km between charges.
Apart from the fact that New Zealand is blessed with a surfeit of electricity (the large majority of it carbon-neutral), and the attraction of a car that ‘‘fills up its tank each night’’, the thing that has really supercharged EVs is Government support.
The Government has a target of 64,000 electrical vehicles on local roads by 2021, quite a hockey stick of growth given we’ve only got around 1500 true EVs on the roads now.
Last year it introduced a wodge of policy to fast-track this process including road-user charge exemptions, supporting a charging infrastructure project and bulkbuying by government agencies.
A key piece of the package was a $6 million contestable fund where the Energy Efficiency and Conservation Authority provides joint venture capital for EV initiatives.
To date, about 15 initiatives have received funding – with the next set about to be announced next month.
The last bucket of approved projects included stuff as diverse as electric car sharing by Z Energy, electric delivery vans for Foodstuffs, and (my personal fave) three fast- charging stations to enable carbon zero eco-tours of the Coromandel. Very cool.
Pleasingly, much went to heavy transport users – from Waste Management, to Tranzit Group and Auckland Transport. Getting them on board early will be pivotal.
On the consumer side there’s one big obstacle. Cost.
Hyundai recently launched their Ioniq. About the size of an Elantra liftback, the Hyundai Ioniq has a start price of $59,990, about $10,000 cheaper than the competition.
It’s a smart move by the company which has previously demonstrated innovation by being the first carmaker to offer its entire range with diesel power plants.
On the one hand, it’s a meaningful step in the right direction. On the other, it’s still beyond the reach of most New Zealanders.
The average value of used vehicles in the New Zealand fleet is about $10,000, and the new price of New Zealand’s favourite car – the Toyota Corolla – is $29,000.
So even if you have carbon neutral tattooed on your forehead, it’s a big stretch to spend $60,000 on a first generation electric car. There needs to be step change.
Interestingly, it was film-maker Kodak that invented the digital camera back in 1975.
It was also first to market with a consumer SLR digital camera, the DCS, which sold for more than $15,000 in the early 90s. Its price was based on the value of the likes of the F3 and the historical margins it had enjoyed. Kodak sold a few, but not many.
A few years later Casio came to the market with a simple, robust digital camera, the QV10, and priced it at $799, about 5 per cent of the price of the Kodak. And it sold like hot cakes.
Although the Casio camera had a wafer-thin margin, so many were sold that it was worthwhile. The unit economics changed and everyone followed suit. Well, not quite everyone. A few years later Kodak filed for Chapter 11 bankruptcy.
Right now, it feels to me that EVs are at a similar point in their development.
One day some manufacturer will deliver a true EV at a price similar to the Corolla. Then the market will accelerate towards the tipping point. And the only people left with cars running on dino juice will be the dinosaurs like me.
Mike ‘‘MOD’’ O’Donnell is a professional director and e-commerce manager. His Twitter handle is @modsta and he’s got more operating cylinders than most.