"The electric car is not dead," general motors North America president Mark Reuss insisted at the recent Automotive News World Congress in Detroit. He's right: automakers are introducing more battery-powered vehicles than ever before, a hopeful sign for this promising green technology. Fiat, Cadillac, Ford and Honda are all launching new electric models this year. Sales of the two mainstream plug-ins already on the market are up: GM's Chevy Volt sales tripled in 2012 over the year before, while the Nissan Leaf's rose modestly, by 1.5%.
Why is the auto industry on the defensive? Sales may be rising, but the Leaf and Volt both failed to reach their projected goals, even though Nissan and GM used cheap lease deals--$139 per month for a Leaf, $269 for a Volt--to goose volume. Electrics are still a tiny part of the auto landscape in the U.S.: cars that use at least some electricity for power accounted for under 3.5% of auto sales in 2012, and plug-ins represented a tiny fraction of that. Conventional hybrids are much more popular, with the Prius outselling the Volt by about 10 to 1.
The biggest hurdle for pure-electric cars, according to auto analysts, is range. Cars like the Leaf, which do not use any gas, max out at about 80 miles before requiring a recharge that can take hours. "If they were literally giving them away, Nissan still could not make the Leaf the predominant vehicle in the U.S.," says John O'Dell, a green-car analyst at Edmunds.com "For most people, it'd be a second car."
The other sticking point is sticker shock. The Volt's $39,145 retail price is roughly double that of a similar car that runs only on gas. Carmakers tout savings on gas costs, but even with generous rebates and tax credits that knock as much as $10,000 off the price, the math doesn't add up in favor of electric cars for most drivers. Still, 2012 lease deals for the Leaf and Volt moved the sales needle, proving there is a market for electrics if the price is right. And prices are becoming more palatable. Nissan just dropped the base price of the Leaf by $6,400, and GM executives say the next edition of the Volt will be thousands of dollars cheaper than last year's.
The newest plug-in models are trying to sell practicality and prestige, with extended drive range, shorter charge times and enough luxury features to make the neighbors green with envy. This may be the year that the car of the future shows whether it has a future at all.