From the Desk of Mike (The Hammer) Garvin

Gunning for the Prius

Is Chinese-American electric car sign of things to come?

By Joseph B. White
Wall Street Journal

The all-electric Coda car, assembled in China, is scheduled to go on sale in the U.S. late this year. Target price: less than $35,000, after tax credits. Photo: CODA Automotive.
The all-electric Coda car, assembled in China, is scheduled to go on sale in the U.S. late this year. Target price: less than $35,000, after tax credits. Photo: CODA Automotive.

By 2050, there could be two billion cars on the road — twice as many as there are today — and 40% of them could be electric. That's the view of Peter Voser, the chief executive officer of oil giant Royal Dutch Shell PLC.

It may seem far-fetched that such a big change in the automobile business could come about in just 40 years. But bigger shifts in technology have happened in less time. Judging how cars will look and run six to eight product generations down the road is a tricky business, as I was reminded last week during a brief trip to the land where the auto industry's future is best glimpsed: California.

A decade ago, gas-electric hybrid cars were exotic rarities on the U.S. road. The first-generation Honda Insight was introduced to the American market in 1999. The first Toyota Prius arrived in 2000. Today, you can rent a 2010 Prius at Los Angeles International Airport as easily as renting a Chevy Malibu.

My rent-a-Prius accelerated when I wanted it to and stopped when I commanded, and it averaged about 50 miles a gallon in mostly freeway driving between LAX and The Wall Street Journal's ECO:nomics conference in Santa Barbara, where I had an appointment with a car that aspires to go the Prius one better by eliminating the need for gasoline entirely.

That car is the first model from Coda Automotive Inc., a Santa Monica, Calif., startup that wants to combine U.S. engineering and quality control with Chinese manufacturing to overcome the cost barrier that has kept modern, street-legal, all-electric cars out of the reach of most U.S. consumers.

I took a ride in a prototype of Coda's first car, which is based on a Chinese-made Hafei Saibao sedan. The vehicle, assembled in Tianjin, is scheduled to go on sale in the U.S. late this year. Kevin Czinger, Coda's CEO, said he hopes to have sold 14,000 of the all-electric cars in California by the end of 2011. Target price: somewhere between $30,000 and $35,000, after tax credits.

If the Coda car hits the market as scheduled, it will be one of a wave of electric or mostly electric cars — the Nissan Leaf, the Chevrolet Volt, the battery-electric Ford Focus, a plug-in Toyota Prius, an electric Mini Cooper and possibly others — due to hit the market over the next one to three years.

Mr. Czinger is a passionate advocate for his concept, but he recognizes some of the pitfalls that threaten the latest effort to create a mass-market electric car industry in the U.S.

The all-electric Coda car, assembled in China, is scheduled to go on sale in the U.S. late this year. Target price: less than $35,000, after tax credits

Electric-car makers should "under-promise and over-deliver," Mr. Czinger says, especially when it comes to the range of their vehicles. Coda's car is designed to go 100 miles between charges, he says, and Coda is basing that claim on the most aggressive of the federal government's standard road tests. He warns that electric-car makers risk disappointing customers if they base a range claim on a government test that is less representative of real-world driving.

A car that sells for about $30,000 and offers just 100 miles of driving between charges may not sound like a big deal, but such machines haven't existed until now, Mr. Czinger says.

Coda has some big-name backers in the U.S. and China. Its Chinese battery manufacturer is backed by China National Offshore Oil Corp., the big Chinese government oil company, which is investing heavily in electric-vehicle battery technology.

The first-generation Coda car looks like a generic, midsize Asian sedan. So far, U.S. consumers seem to prefer green cars that have distinctive looks and broadcast their identities as low-carbon, high-tech cars. That's one reason why the Prius outsells all other hybrid models.

Someday, Mr. Czinger says, he wants to see a new generation of Coda cars made in the U.S. For now, Coda's initial sales goals for the U.S. are modest. Mr. Czinger says many of the first sales will be to the fleets of corporations interested in showing a commitment to the environment.

In certain ways, Mr. Czinger and Coda hark back to the auto industry's earliest days, which are brought to life in exhibits the Petersen Automotive Museum in Los Angeles. In 1901, for instance, an L.A. native named Carl Breer built a tiny, two-cylinder steam carriage, making many of the components himself.

In less than 15 years, Henry Ford was cranking out Model Ts on moving assembly lines, and cars made the leap from the technological fringe to the mainstream of the American economy. Mr. Breer went on to become an executive at Chrysler Corp., leading the design of the Chrysler Airflow — a radically aerodynamic car that arrived about 50 years too soon — and lived long enough to see Detroit's muscle-car glory days.

It's no sure bet that electric cars will displace internal-combustion cars on a mass scale, especially if oil stays cheap and abundant. But it's equally uncertain that the relatively slow pace of automotive innovation between 1950 and 2000 will be the norm going forward.

10 March 2010 — Return to Cover