Automotive startup GreenTech will soon be sending its MyCar to a “Neighborhood Electric Vehicle” market experts say is still in its infancy, at least outside of California.
The two-seater MyCar is limited to speeds of 35 mph and prohibited on major highways. The car is expected to begin coming off the assembly line at GreenTech’s recently completed Tunica plant by the end of the year.
GreenTech issued a press statement on the plant’s completion in early September, but otherwise has been secretive about how the car will be marketed and whether other models are in the works. The company has promised more details at the fourth quarter grand opening of the plant near the intersection of Old Mississippi 304 and Buck Island Road. GreenTech had been using a former elevator factory in Horn Lake as a test facility.
Getting to the assembly stage follows two years of delays and a federal investigation into enticements used to gain foreign investors for the plant. The slow progress by the McLean, Va., automaker likely created some jitters among stakeholders Tunica County and the Mississippi Development Authority. The county’s Economic Development Foundation donated 100 acres, at a cost of $1.8 million, and the MDA loaned the company $3 million for site preparation.
“They have come a long way,” said Lyn Arnold, head of the Tunica Economic Development Foundation. She noted GreenTech has a certificate of occupancy for the new building.
“They are moving equipment into it,” she said.
MDA spokesman Jeff Rent said GreenTech must begin repaying the $3 million six months after starting operation. The loan is for 10 years, he said.
When it broke ground in 2009, GreenTech detailed plans for producing versions of the four prototypes it showcased then, including hybrid cars. It has since said it will make the MyCars and an electric-powered sedan, according to the Associated Press.
The AP reports that GreenTech has international distribution agreements for 30,000 vehicles over the next three years. The company originally planned 250,000 vehicles.
In the brief press release earlier this month, Chairman & CEO Charles Wang said GreenTech has made “significant progress toward our engineering, production, hiring and industry partnership goals in recent months.”
GreenTech is a subsidiary of WM Industries Corp., which describes itself as Detroit-based luxury sedan and sports car manufacturer.
Roger King, director of the Mississippi State University Center for Advanced Vehicle Systems or CAVS, in Canton, said the center worked with GreenTech early on but not in recent years. The job ahead for GreenTech and other electric automakers is overcoming “range anxiety” car buyers have about the short distances electric cars can travel before needing a battery recharge, King said.
Tesla, the high-priced all electric car conceived by billionaire Elon Musk, can go more than 200 miles without a recharge. The key is for manufactures such as GreenTech to match the Tesla range but at a far lower sale price, King noted.
Musk hopes to begin producing a more economical lithium battery in Nevada. “That is the future,” King said.
Meanwhile, GreenTech and other electric car makers must be patient, said John O’Dell, senior editor for fuel efficiency and alternative vehicles at Edmunds, an automotive publication and website that offers research and pricing on all types of vehicles.
“The whole segment needs to be moving into the automotive mainstream. This hasn’t happened,” he said, “outside of a state like California, which requires automakers to make them available if they want to continue selling cars.”
California, O’Dell said, accounts for 40 percent of national sales of plug-in vehicles. “Even then, they are a miniscule part of total sales,” he added, citing San Francisco and Los Angeles as the two main California markets for electric vehicles.
In the United States, electric cars and their hybrid cousins account for only seven-tenths of 1 percent of the automotive market, according to O’Dell. Of the 18 all-electric models sold, only four are sold outside of California, he noted.
Price – they cost around $4,000 more than a hybrid, is one market obstacle, O’Dell said, though he added the industry is expected to bring prices in line with conventional gas-powered cars by 2020.
Current state and federal tax credits help defray costs as well, he noted.
Charging time is another obstacle. Most electric cars are recharged by home 110V wall outlets and can take nearly 20 hours to regain full capacity. A charging station’s 220V outlet will do the job in about four hours but the United States has yet to begin planning a national fueling system for EVs, O’Dell said.
The lithium battery accounts for nearly half the price of an electric car, according to O’Dell. He said by its eighth year of use charging capacity diminishes to around 80 percent, thus reducing a typical car’s range from 80 miles to 70 miles. By the 12th year you can expect the battery’s life to expire, he added.
“The big problem is that the batteries degrade over time,” especially in either hot or cold climates, O’Dell said.
Most manufacturers warranty the batteries to 90 percent capacity for at least eight years, he noted.
O’Dell said he expects GreenTech will encounter challenges moving its MyCar into the neighborhood car market. The bigger manufacturers have the promotional dollars and the exclusive contracts sellers, though “big” is relative in the neighborhood car market, he noted.
GEM, a subsidiary of six-decade-old Polaris, is the market leader, having sold about 55,000 vehicles around the world, O’Dell said. GEM got a huge sales boost when it contracted with huge Los Angeles mixed-use community Mar Vista. Every homebuyer could by a GEM neighborhood car at an attractive discount, he said.
“They are not marketing to John Q. Public,” he said of GEM. “They are marketing to businesses and governments that can use these type vehicles for park maintenance or shuttling people around business campuses.”
O’Dell said it is difficult to assess the market for GreenTech’s MyCar. The company has not even said where it plans to sell them, he noted.
“They are highly secretive about how many people they employ, how many cars they are going to build. They want to sell cars but they don’t want to talk to anyone,” the automotive editor said.
O’Dell said he expects it is possible GreenTech will build a car and market it, but he is not without some doubts. “If they were going to build a car they would be out there seeding the ground with advertising and talking about it.”
Meanwhile, O’Dell noted, “Nobody I know who is in the business is predicting any sizable market share for electric vehicles. They are still a niche.”
What EVs need, he said, is either a charging breakthrough or a battery breakthrough.
“The pure electric car in this country tends to be a hard sell for whatever reason. Personally, I love them.”
And the rest of us may have to learn to love them as well. The federal government has mandated vehicles get 54 miles-to-the-gallon by 2025, O’Dell said.
“The only way we can get there is electric vehicles.”