The Fuse

France’s “EV for the People” Misses the Big Picture in Future Mobility

by R. Kress | January 13, 2016

So far, government support has proved to be a vital factor in gaining traction for electric vehicle adoption. But not all support is created equal: Some policymakers have found ways to say that they’re bolstering EV deployment without delivering results. That’s why when Ségolène Royal, French minister of ecology, sustainable development and energy announced a new initiative to create an “electric car for the people” that would cost $7,500 or less, experts were not quick to praise her.

Royal’s announcement at COP21 called for international competition to create this car, noting that the vehicle could cost as little as $5,300. She pointed out that it “may not look like traditional electric cars” and be somewhat lighter and smaller, but should be capable of fast charging.

“In emerging countries, the growing middle class means that there are more and more vehicles being purchased and most of these cars are fossil fuel cars,” she said. “This is a very attractive solution.”

While Royal’s announcement is almost certainly intended as supportive of EVs, the actual impact might be the opposite.

“There’s some merit in setting ambitious targets,” said Jeremy Michalek, professor of engineering and public policy at Carnegie Mellon University. He’s also the director of the school’s vehicle electrification group. “But if there are more efficient ways to deal with the problem and we miss them because we’re pursuing a specific strategy, we may be missing an opportunity.”

Michalek noted that a more effective policy might be to target an end goal—reducing oil dependence, for example—and work backwards from that, as opposed to announcing an EV that may not have wide appeal. Furthermore, he expressed skepticism that this car would be something people would go out of their way to purchase, by pointing out that other EVs have started with more expensive models and slowly pared down features to reach a lower price—Tesla being an example of this.

“When you start on the low end, you’re talking about a limited range and limited features. It’s not for everyone but it’s another niche market that could be a part of the trajectory to making the technology more relevant to consumers,” Michalek said.

“It’s plausible that you could build the car [at the $7,500 price point] but you’d be giving something up… If you make enough compromises you can get the price down. But the portion of the population that it becomes relevant for is reduced.”

With such a limited range of capabilities, is such a car really going to move the needle for widespread EV adoption?

While Michalek believes that actually constructing a car that could retail for $7,500 could be possible, he notes that it might not look like any type of EV we know today—a point that Minister Royal also underscored. He estimates that the car would have to be very small, very light, and be targeted for mostly neighborhood applications as it would likely not exceed speeds of about 35 miles per hour. With such a limited range of capabilities, is a car like that really going to move the needle for widespread EV adoption?

“The market has been pretty clear that 200 miles is a minimum [range] for a mainstream adoption,” Tony Seba told the Fuse, author of Clean Disruption of Energy and Transportation and lecturer at Stanford University. “The question is can we make a 200-mile [range] EV for $7,500? The answer is not yet.”

Seba pointed to India’s attempt at a cheaper EV for the people: The E2o by Mahindra Reva.

“A lot of these companies such as Mahindra bring out a little car with 100 mile range… it’s a little boxy car and the reviews haven’t been good,” Seba says. “What that tells you is that yes, you can do a [cheaper] EV but that’s not the EV that’s going to win in the market. The EV that’s going to win in the market is a superior car.”

Seba, who had just returned from COP21—although had not attended Minister Royal’s remarks in person—said that even if she was hoping to reinvigorate battery-swapping at that price point, it was not going to be welcomed with open arms.

“The market has shown that that is not what people want. They don’t want to stop and swap batteries,” Seba said, citing Tesla’s experiment in battery swaps.

Seba is thinking outside the box when it comes to real solutions to develop the transportation of the people—and his answer is much bigger than a $7,500 EV.

“I think that if governments really wanted to help push the cost of EVs down, then they should be investing in research and development for batteries,” Seba said, speaking globally. But when it comes to action that France could take that would lead to realistic change, Seba points to legalizing vehicle-to-grid integration—which is currently banned in France.

If France wants to make EVs happen, then they should make vehicle-to-grid technology legal.

“This kind of technology could power a user’s EV with solar while it’s parked at work and bring [that energy] back home. You could use the vehicle as a way to store electricity for solar or wind and then use it to power the grid itself, your house, or your apartment building,” says Seba of the technology he saw in action at COP21. He cites a discussion he had with Nissan as indicating that the 2016 Leaf could power an apartment building for a day or two—but only if local regulations permit it to do so. “It turns out that in France, using your vehicle to power your house is not legal. Using this vehicle to grid technology is not legal: Because the grid is a monopoly, the utility is a monopoly. So if France wants to make EVs happen, then they should make vehicle-to-grid technology legal. By doing that, there is one more incentive for car buyers to buy EVs.”

But Seba thinks even bigger than vehicle-to-grid technology when it comes to advanced transportation. He sees the coming tide of self-driving cars colliding with ride sharing to create a world where personal vehicle ownership is no longer necessary at all.

By the time the cost of EVs declines into the more manageable price range of $15,000, self-driving cars will be much more common anyway.

“The truth is that car ownership will be obsolete. We won’t even need a car for the people. We’ll just need mobility that’s cheap, that’s affordable and available to everyone everywhere,” says Seba of this future. “That’s going to make transportation available to the very old who can’t drive, to the very young who can’t drive and the very sick who can’t drive. That’s transportation for the people—it’s not a $7,500 car. It’s very inexpensive, on-demand mobility. And that’s only going to happen when you have the combination of car sharing and self-driving [technology].”

Seba points out that by following the trends that are currently in action, by the time the cost of EVs declines into the more manageable price range of $15,000, self-driving cars will be much more common anyway.

Seba estimates that a future when self-driving cars and ridesharing coalesce could be as soon as 2025 or 2030. “That’s the real transportation for the people. Not a $7,500 car, not a $15,000 car, but when we won’t need to own a car at all.”