The bumpy road to 1 million electric vehicles

This investigation by Sharyl Attkisson was first published on June 5, 2012 at CBS News.

(CBS News) WASHINGTON Sharyl Attkisson – The Obama administration invested $2.4 billion as part of its goal of putting one million electric vehicles on the road by the end of 2015. But that effort has, in part, stalled.

Nothing is more emblematic of the industry’s troubles than the Fisker Karma. In 2010, Fisker got a $529 million taxpayer loan to build a luxury electric sports car.

But the government cut off the loan to Fisker after $193 million when Fisker failed to meet its ambitious sales and production goals. Then, a Consumer Reports test dealt the Karma another blow.

“It is low. It is sleek. It is sensuous,” the Consumer Reports’ video narrator says.

“It’s also broken,” the narrator adds as a clip of the Fisker Karma being towed on a flatbed airs.

Fisker blamed the car’s lithium ion battery, which happened to be made by another government loan recipient, A123 Systems.

A123 got a $249 million taxpayer loan. This year’s first-quarter losses totaled $125 million.

The industry’s misfortunes have seriously undermined President Obama’s goal.

“We can replace our dependence on oil with biofuels and become the first country to have a million electric vehicles on the road by 2015,” Obama said in January 2011.

To get to one million, the White House pinned its hopes on 11 models of electric vehicles – including the Karma. Our CBS News investigation found that six of the 11 — Ford Focus, Ford Transit Connect, Fisker Nina/Atlantic, Tesla Model S, Tesla Roadster and Think City — either haven’t made their first delivery, stopped production, or are already out of business.

Others aren’t even close to the government’s 2015 projections. For example, 36,000 Fisker Karmas and 505,000 Chevy Volts were supposed to be made. But current projections slash the Karma’s 2015 number in half to 18,000 and put the Volt at one-eighth of the goal at 62,000.

(See chart below)

“I think these forecasts were very unrealistic, and history is showing that scaling an automobile company is much more difficult than many of these people thought,” Craig Carlson, industry analyst and managing director of Carlson Group, Electric Vehicles, told CBS News.

When told about the CBS News projection that only 300,000 electric vehicles would be on the road instead of the proposed 1 million, the Energy Department’s David Sandalow said, “Well, let’s hope that we can move faster. And if we don’t hit that goal in 2015, let’s hit it in 2016.”

CBS News pointed out that the Energy Department hoped that Think City would produce 57,000 cars, but only built 263 and went out of business. Ford Transit Connect was supposed to make 4,200 vehicles, but only built 500 and filed for bankruptcy. 

But, Sandalow reminded that there were some successes.

“General Motors sold more than 5,000 last year,” he said. “And so did Nissan. Around the world this industry is exploding. Innovation involves risks. Any type of new industry is going to encounter some successes and some failures.”

As reflected in our chart, Tesla is the only company on the Obama administration’s list that has met and/or anticipates it will meet the administration’s production goals.

Even falling far short of a million, backers say electric cars will take off as people realize how much fun and cheap they are to drive. Just to be sure, the president wants to invest $4.7 billon more tax dollars in electric vehicle incentives. 

Tesla says it will begin deliveries of the Model S on June 22, and that its Roadster -no longer in production– was always intended to be a limited run.

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3 thoughts on “The bumpy road to 1 million electric vehicles”

  1. Thank you for revisiting this. Of course, once a week, the Government throws billions at a project that makes the politicians feel good about themselves (and more importantly buys votes) but does no actual good. Or actually makes things worse. At 34 trillion dollars and counting, we can no longer elect people, like Obama, who have no idea what they are doing. But unfortunately we WILL go on electing people who have no clue about how to solve problems. (Look at Biden and his crew of morons in charge now.) So we will go on committing suicide as a country. That spaceship to Mars can’t come soon enough.

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