The 21st Century Car Industry: Why Plug-in and Electric Car Conversions Could Fix it

plug-in hybrid conversion

Entrepreneurs have begun to retrofit ordinary combustion vehicles into all-electrics or plug-in hybrids. Here’s why this could be the “big fix” that the auto-industry needs.

Are we stuck with our oil addiction? What if millions of our middle-aged vehicles could be reincarnated as superior versions of their youthful selves, while developing new revenue streams for Detroit? What if that “fix” could start reducing the billion a day we spend on imported oil, while creating tens of thousands of local jobs in communities and cutting greenhouse gases from fossil fuels?

Automakers could do all this—by thinking of vehicles as upgradable high-tech products. For example: A pioneering Chicago startup makes a prototype Ford F-150 pickup with an all-electric range of 30 miles per charge. After that it’s a hybrid, boosting the best-selling truck’s 15 city miles per gallon to 21.

In volume, this conversion could sell for $10-15,000. Converting school and transit buses could cost $35,000, with three- to five-year paybacks and reduced diesel fumes. And delivery vans that stay on the road up to 300,000 miles, with engines replaced every 100,000, could instead get partly electrified. Solutions starting in under 10-MPG niches could then spread to gas-guzzling vans, SUVs, and large passenger vehicles.

Cash for Clunkers vs Cash for Conversions

As “Cash for Clunkers” proves the pent-up demand for new vehicles, it also reveals another significant lesson: what old products are worth. Why not monetize aging assets while retaining the energy and materials used to build them? Amidst the auto crisis, it’s a transformational opportunity to create a new future-facing business model for the industry.

Today’s auto companies are like parents launching their millions of offspring, saying, “Bye…we don’t expect to hear from you again unless something fails under warranty.” Their dealers hope for service revenue and repeat sales. Except for occasional annoying recalls, they have no way to add improved technologies to vehicles that suffer from unplanned obsolescence.

Other industries create products as platforms. Some software firms make more from upgrades than from original sales. Computer companies shift from selling hardware to providing information technology systems and services. Automobiles are our longest-lifetime technology product. Why shouldn’t OEMs (original equipment manufacturers), integrators, suppliers, and dealers acquire a lifetime interest in them?

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Comments

  1. Bobby B. says:

    1. One does not boost a vehicle’s MPG by converting it to a plug-in hybrid. The extra miles you perceive are in reality purchased from your utility company, instead of the corner gas station. If cap-and-trade (HR2454) becomes law, not only will gasoline and diesel increase in price, but so will one’s utilities. Equivalent mileage is a myth.

    2. Why would anyone want to put a $15,000 conversion on a $20,000 pick-up truck when said conversion adds no value to the truck? The school bus conversion makes sense in that it begins indoctrinating the children at a young age.

    3. Cash for clunkers swapped fewer than 200,000 old vehicles for new vehicles. A drop in the bucket for an industry that averages 18 million units per year (icmarc.org/xp/rc/marketview/chart/2009/20090626TotalVehicleSales.html). Plus, according to Edmunds, the clunkers were not traded for hybrids (money.cnn.com/2009/08/07/autos/cash_for_clunkers_sales/).

    Best wishes.

  2. Bobby B. says:

    1. One does not boost a vehicle’s MPG by converting it to a plug-in hybrid. The extra miles you perceive are in reality purchased from your utility company, instead of the corner gas station. If cap-and-trade (HR2454) becomes law, not only will gasoline and diesel increase in price, but so will one’s utilities. Equivalent mileage is a myth.

    2. Why would anyone want to put a $15,000 conversion on a $20,000 pick-up truck when said conversion adds no value to the truck? The school bus conversion makes sense in that it begins indoctrinating the children at a young age.

    3. Cash for clunkers swapped fewer than 200,000 old vehicles for new vehicles. A drop in the bucket for an industry that averages 18 million units per year (icmarc.org/xp/rc/marketview/chart/2009/20090626TotalVehicleSales.html). Plus, according to Edmunds, the clunkers were not traded for hybrids (money.cnn.com/2009/08/07/autos/cash_for_clunkers_sales/).

    Best wishes.

  3. Conversions and maintenance are way too pricey at the moment to encourage enough people to do it.

  4. Conversions and maintenance are way too pricey at the moment to encourage enough people to do it.

  5. Felix Kramer says:

    Currently, electric miles cost about 2-4 cents compared to 8-40 cents for gasoline miles (depending on many assumptions). With cap-and-trade, the price disparity between the highest-carbon fuels and increasingly low-carbon electricity will increase.

    The conversions we anticipate are for used vehicles rather than brand-new trucks, thereby giving them many more years of life as cleaner vehicles with lower operating costs.

    Of course, conversions are way too expensive until they scale at levels that can come only with cooperation from automakers for validated designs. We’re just beginning that journey.

    – Felix Kramer, Founder, CalCars.org

  6. Felix Kramer says:

    Currently, electric miles cost about 2-4 cents compared to 8-40 cents for gasoline miles (depending on many assumptions). With cap-and-trade, the price disparity between the highest-carbon fuels and increasingly low-carbon electricity will increase.

    The conversions we anticipate are for used vehicles rather than brand-new trucks, thereby giving them many more years of life as cleaner vehicles with lower operating costs.

    Of course, conversions are way too expensive until they scale at levels that can come only with cooperation from automakers for validated designs. We’re just beginning that journey.

    – Felix Kramer, Founder, CalCars.org

  7. Mamoru says:

    I can’t even justify paying 5k for a used car, let alone investing 10 to 15k in one.

  8. Mamoru says:

    I can’t even justify paying 5k for a used car, let alone investing 10 to 15k in one.

  9. Mamoru says:

    I can’t even justify paying 5k for a used car, let alone investing 10 to 15k in one.

  10. Mamoru says:

    Bobby B.

    Trade and Cap dose pose a problem, but when Solar Panels hit $1 a watt, I will have to ask so what?

    As to cash for clunkers. Small Steps, as much as I would like to see everything happen overnight myself. I know it won’t happen.

  11. Mamoru says:

    Bobby B.

    Trade and Cap dose pose a problem, but when Solar Panels hit $1 a watt, I will have to ask so what?

    As to cash for clunkers. Small Steps, as much as I would like to see everything happen overnight myself. I know it won’t happen.

  12. Bobby B. says:

    @Mamoru: It was a small step that yielded very little. I do think that it was cool that recipients found a loophole with which to buy what they wanted and not something that was mandated. I am not a big fan of hybrids.

  13. Bobby B. says:

    @Mamoru: It was a small step that yielded very little. I do think that it was cool that recipients found a loophole with which to buy what they wanted and not something that was mandated. I am not a big fan of hybrids.

  14. Antonio Andolini says:

    I think it’s really lame that gas2.org is creating multiple pages for a single article – attempting to create a false sense of growing page views for the sake of advertising dollars. I never click to the second page + when websites get petty like this. I will stop visiting this site if they continue to slow down my web surfing experience.

  15. Antonio Andolini says:

    I think it’s really lame that gas2.org is creating multiple pages for a single article – attempting to create a false sense of growing page views for the sake of advertising dollars. I never click to the second page + when websites get petty like this. I will stop visiting this site if they continue to slow down my web surfing experience.

  16. Antonio Andolini says:

    I think it’s really lame that gas2.org is creating multiple pages for a single article – attempting to create a false sense of growing page views for the sake of advertising dollars. I never click to the second page + when websites get petty like this. I will stop visiting this site if they continue to slow down my web surfing experience.

  17. dave says:

    @ Bobby P:

    1. Nobody cares about MPG. Electric motors are close to 80% efficient, you’re using less energy PERIOD.

    mpg and horsepower ratings for ICE vehicles don’t apply, its idiotic. (And yeah, I live somewhere sunny, so Solar FTMFW.)

    2. Why would anyone want the government subsidizing car purchases that only net a new ICE vehicle a minimum of 4mpg better ? Its like digging to get out of a hole. Why not subsidize new companies with new, cleaner solutions and help them get a head start, rather than help to “stay the course”.

    3. Agreed C4C is absolute bunk and is not really encouraging people to buy more fuel efficient cars let alone hybrids. The restrictions should be tougher and vouchers much greater to encourage hybrid purchases.

    Best wishes.

  18. dave says:

    @ Bobby P:

    1. Nobody cares about MPG. Electric motors are close to 80% efficient, you’re using less energy PERIOD.

    mpg and horsepower ratings for ICE vehicles don’t apply, its idiotic. (And yeah, I live somewhere sunny, so Solar FTMFW.)

    2. Why would anyone want the government subsidizing car purchases that only net a new ICE vehicle a minimum of 4mpg better ? Its like digging to get out of a hole. Why not subsidize new companies with new, cleaner solutions and help them get a head start, rather than help to “stay the course”.

    3. Agreed C4C is absolute bunk and is not really encouraging people to buy more fuel efficient cars let alone hybrids. The restrictions should be tougher and vouchers much greater to encourage hybrid purchases.

    Best wishes.

  19. Bobby B. says:

    @dave:

    1. Just because the motors that drive the wheels are 80% efficient doesn’t mean that you are necessarily using less energy.

    A utility burns fuel to generate power. Most utilities convert 30% to 50% of the fuel into usable electricity. The remainder is heat loss. Some of the newer combined-cycle plants are approaching 80% total efficiency, but that assumes that the end user has a use for the by-products of the waste heat (i.e. steam, hot water, flue gas, etc.). So, for the sake of this discussion, let’s be generous and assume an electric generating efficiency of 50%. Transmission and distribution of electricity (i.e. the grid) eats up another 7% of the efficiency between the generator and the user. So, now you are left with 43% of the fuel’s original energy content available at your household electric socket. If your car is a plug-in with electric motors that are 80% efficient under load (which they aren’t), then 20% of the of the energy stored in the batteries gets lost to heat, friction, etc. The bottom line is that total efficiency of the concept comes in under 23%. Operating costs may be lower since gasoline costs per kW-hr are a bit higher than what utilities charge per kW-hr. However, claims of higher efficiency and lower emissions have to be restricted to the electric-car-battery-to-wheels-on-the-road paradigm with total disregard for what happens upstream of the electric wall socket. Since the average automobile utilizes 25% to 30% of its fuel’s energy to push it down the road, run its creature comfort features and recharge its battery, the comparison becomes a wash.

    Hybrids do have a little more going for them. The concept of using the automobile’s wasted energy to charge a large battery is already proving to outperform conventionals. Unfortunately, those big batteries are energy intensive and expensive to produce and costly to replace. You may not know this, but all modern railroad locomotives are hybrids without batteries. Diesel engines are coupled to a generators to produce electricity for immediate use by the motors that drive the wheels.

    I will not even start one of my rants about the shortcomings of hydrogen vehicles.

    2. Agreed.

    3. Agreed.

    Take care.

  20. Bobby B. says:

    @dave:

    1. Just because the motors that drive the wheels are 80% efficient doesn’t mean that you are necessarily using less energy.

    A utility burns fuel to generate power. Most utilities convert 30% to 50% of the fuel into usable electricity. The remainder is heat loss. Some of the newer combined-cycle plants are approaching 80% total efficiency, but that assumes that the end user has a use for the by-products of the waste heat (i.e. steam, hot water, flue gas, etc.). So, for the sake of this discussion, let’s be generous and assume an electric generating efficiency of 50%. Transmission and distribution of electricity (i.e. the grid) eats up another 7% of the efficiency between the generator and the user. So, now you are left with 43% of the fuel’s original energy content available at your household electric socket. If your car is a plug-in with electric motors that are 80% efficient under load (which they aren’t), then 20% of the of the energy stored in the batteries gets lost to heat, friction, etc. The bottom line is that total efficiency of the concept comes in under 23%. Operating costs may be lower since gasoline costs per kW-hr are a bit higher than what utilities charge per kW-hr. However, claims of higher efficiency and lower emissions have to be restricted to the electric-car-battery-to-wheels-on-the-road paradigm with total disregard for what happens upstream of the electric wall socket. Since the average automobile utilizes 25% to 30% of its fuel’s energy to push it down the road, run its creature comfort features and recharge its battery, the comparison becomes a wash.

    Hybrids do have a little more going for them. The concept of using the automobile’s wasted energy to charge a large battery is already proving to outperform conventionals. Unfortunately, those big batteries are energy intensive and expensive to produce and costly to replace. You may not know this, but all modern railroad locomotives are hybrids without batteries. Diesel engines are coupled to a generators to produce electricity for immediate use by the motors that drive the wheels.

    I will not even start one of my rants about the shortcomings of hydrogen vehicles.

    2. Agreed.

    3. Agreed.

    Take care.

  21. Tim Cleland says:

    The main advantage of electric cars, IMHO, is that it will make coal a much more valuable resource (and America is awash in coal) and reduce our dependence on foreign oil.

  22. Tim Cleland says:

    The main advantage of electric cars, IMHO, is that it will make coal a much more valuable resource (and America is awash in coal) and reduce our dependence on foreign oil.

  23. Tim Cleland says:

    The main advantage of electric cars, IMHO, is that it will make coal a much more valuable resource (and America is awash in coal) and reduce our dependence on foreign oil.

  24. Danny D Economist says:

    It took 3 pages for you to express already known concepts that can be formed within a few paragraphs.

    Also, there is obviously a secondary (used car) market that will develop specifically for electric adoptions: eBay Motors is a start, LOL. Your “parenting” analogy is useful, however, there is no reason trying to lecture the corporate abyss shifting its usual ways: its all for a reason due to liabilities and contracts, duh?

  25. Danny D Economist says:

    It took 3 pages for you to express already known concepts that can be formed within a few paragraphs.

    Also, there is obviously a secondary (used car) market that will develop specifically for electric adoptions: eBay Motors is a start, LOL. Your “parenting” analogy is useful, however, there is no reason trying to lecture the corporate abyss shifting its usual ways: its all for a reason due to liabilities and contracts, duh?

  26. Bobby B. says:

    @Tim

    Great point! America does have abundant coal supplies. Unfortunately, the environmental movement and the current administration are vehemently anti-coal. Read a few passages from HR2452 (The Cap and Trade Bill that passed in the House) to see the plans they have to punish coal. Here is a sampling from Subtitle B (Page 65):

    “d) ASSESSMENTS.—

    1) AMOUNT.—(A) In all calendar years following its establishment, the Corporation {a new government agency} shall collect an assessment on distribution utilities for all fossil fuel-based electricity delivered directly to retail consumers (as determined under subsection (f)). The assessments shall reflect the relative carbon dioxide emission rates of different fossil fuel-based electricity, and initially shall be not less than the following amounts for coal, natural gas, and oil:

    Fuel type Rate of assessment

    per kilowatt hour

    Coal …………………………… $0.00043

    Natural Gas …………………….. $0.00022

    Oil ……………………………. $0.00032.”

    Did you notice how much higher coal’s assessment will be? An assessment is simply a tax, which is generally passed to the consumer by those that manufacture the goods. Even though the assessment rates per kilowatt-hour seem relatively low across the board, you have to consider that it will be applied to everything that requires electricity to produce; which exempts nothing. Most critics point out that the admistration’s claim that the planet can be saved for only $175 per household is grossly underestimated. Others estimate the costs to be 10 to 20 times that figure annually. The National Black Chamber of Commerce estimates losses of “2.3-2.7 million jobs in each year of the policy through 2030–after accounting for ‘green job’ creation.” We are already seeing how painful a recession can be. Do we really want to exacerbate the experience?

    I would also highly recommend that everyone read Section 201 to see how cap and trade will allow the central government into each and every home. Here is a sampling of what can be done to code violators:

    “(3) VIOLATIONS.—It shall be a violation of this section for an owner or builder of a building to knowingly occupy, permit occupancy of, or convey the building if the building is subject to the requirements of—…”

    That means you can be evicted from your home if it fails to meet the new standards. Plus, you can’t sell (convey) it. Other sections describe the daily fines that will be imposed on you while you correct your dwelling. How many families risk becoming unemployed, law breakers with no claims to the land that they purchased before this wonderful piece of legislation?

    Currently floating around the internet are a video and a streaming audio file of Congressman Steve Scalise’s (R-LA) comments on this bill, which include the following quotation: “We’re setting up a global warming Gestapo that can literally come in and now this new term, ‘unlawful occupancy.’ Now living in your home is considered unlawful under this bill. This is ludicrous.”

    I couldn’t make this stuff up.

  27. Bobby B. says:

    @Tim

    Great point! America does have abundant coal supplies. Unfortunately, the environmental movement and the current administration are vehemently anti-coal. Read a few passages from HR2452 (The Cap and Trade Bill that passed in the House) to see the plans they have to punish coal. Here is a sampling from Subtitle B (Page 65):

    “d) ASSESSMENTS.—

    1) AMOUNT.—(A) In all calendar years following its establishment, the Corporation {a new government agency} shall collect an assessment on distribution utilities for all fossil fuel-based electricity delivered directly to retail consumers (as determined under subsection (f)). The assessments shall reflect the relative carbon dioxide emission rates of different fossil fuel-based electricity, and initially shall be not less than the following amounts for coal, natural gas, and oil:

    Fuel type Rate of assessment

    per kilowatt hour

    Coal …………………………… $0.00043

    Natural Gas …………………….. $0.00022

    Oil ……………………………. $0.00032.”

    Did you notice how much higher coal’s assessment will be? An assessment is simply a tax, which is generally passed to the consumer by those that manufacture the goods. Even though the assessment rates per kilowatt-hour seem relatively low across the board, you have to consider that it will be applied to everything that requires electricity to produce; which exempts nothing. Most critics point out that the admistration’s claim that the planet can be saved for only $175 per household is grossly underestimated. Others estimate the costs to be 10 to 20 times that figure annually. The National Black Chamber of Commerce estimates losses of “2.3-2.7 million jobs in each year of the policy through 2030–after accounting for ‘green job’ creation.” We are already seeing how painful a recession can be. Do we really want to exacerbate the experience?

    I would also highly recommend that everyone read Section 201 to see how cap and trade will allow the central government into each and every home. Here is a sampling of what can be done to code violators:

    “(3) VIOLATIONS.—It shall be a violation of this section for an owner or builder of a building to knowingly occupy, permit occupancy of, or convey the building if the building is subject to the requirements of—…”

    That means you can be evicted from your home if it fails to meet the new standards. Plus, you can’t sell (convey) it. Other sections describe the daily fines that will be imposed on you while you correct your dwelling. How many families risk becoming unemployed, law breakers with no claims to the land that they purchased before this wonderful piece of legislation?

    Currently floating around the internet are a video and a streaming audio file of Congressman Steve Scalise’s (R-LA) comments on this bill, which include the following quotation: “We’re setting up a global warming Gestapo that can literally come in and now this new term, ‘unlawful occupancy.’ Now living in your home is considered unlawful under this bill. This is ludicrous.”

    I couldn’t make this stuff up.

  28. Bobby B. says:

    Oh, I almost forgot to mention that your shiny electric car will sure look nice sitting idle on the repo dealer’s lot.

  29. Bobby B. says:

    Oh, I almost forgot to mention that your shiny electric car will sure look nice sitting idle on the repo dealer’s lot.

  30. Bobby B. says:

    Oh, I almost forgot to mention that your shiny electric car will sure look nice sitting idle on the repo dealer’s lot.

  31. Bill Rowling says:

    There are thousands of new 2008 small cars that didn’t sell because of the economy at the Port of Tacoma and other ports too. Convert them to all electric. It’s fun to convert a spanky clean new car.

  32. Bill Rowling says:

    There are thousands of new 2008 small cars that didn’t sell because of the economy at the Port of Tacoma and other ports too. Convert them to all electric. It’s fun to convert a spanky clean new car.

  33. Jerry says:

    I have a question, does anyone know how much kWhr does it take a passenger car typically take to drive a mile (or 100 miles)?

  34. Jerry says:

    I have a question, does anyone know how much kWhr does it take a passenger car typically take to drive a mile (or 100 miles)?

  35. Lys says:

    Toyota Rav4 EV (Full EV, but a heavy SUV):

    27 Kwh = 100 miles (city)

    34 Kwh = 100 miles (highway)

    And it’s a 2002 year tecnology.

    Sure they can do it better 7 years later.

  36. Lys says:

    Toyota Rav4 EV (Full EV, but a heavy SUV):

    27 Kwh = 100 miles (city)

    34 Kwh = 100 miles (highway)

    And it’s a 2002 year tecnology.

    Sure they can do it better 7 years later.

  37. JCitzen says:

    The poster talking about relative efficency was right, but Joe and Jill six pack don’t give a flying **** about that! They want CHEAP transportation! Getting OFF oil will eventually result in CHEAPER transportation. One way to satisfy ALL requirements:

    1. cheaper

    2. more efficient

    3. national security

    Is to convert to methanol fuel cells!! Methanol can be make of natural gas very economically, fuel cells are way more efficent than even coal fired electricity! It takes about $35,000 to convert a big vehicle to hybrid, where as 1200Kwh methanol generator can be had for way less than $6000.

    You could do a cash for conversion program and the cost would be humongously less expensive on a large scale, than pure EV battery conversions, and you would still put out 35% of the CO2 that gas guzzlers do!(that is a LOT less)

    Scientist are working now to use algae – specially DNA modified that can convert more waste material to methanol than we could convert natural gas!! Very efficient methods have been proven, and we could even use coal exhaust to do it. This at least is something that could start a science and infrastructure foundation, to renewable resources. Do not under-estimate the power of diatomic life; methanol could bury the oil companies in rapid succession, if the government would just support it.

    I suspect they already know this and are trying to obfuscate the subject matter! Even Alan Greenspan was confused at why methanol wasn’t chosen rather than ethanol, which is mostly food product(which has been torpedoed by the oil distribution industry as well!!)

  38. JCitzen says:

    The poster talking about relative efficency was right, but Joe and Jill six pack don’t give a flying **** about that! They want CHEAP transportation! Getting OFF oil will eventually result in CHEAPER transportation. One way to satisfy ALL requirements:

    1. cheaper

    2. more efficient

    3. national security

    Is to convert to methanol fuel cells!! Methanol can be make of natural gas very economically, fuel cells are way more efficent than even coal fired electricity! It takes about $35,000 to convert a big vehicle to hybrid, where as 1200Kwh methanol generator can be had for way less than $6000.

    You could do a cash for conversion program and the cost would be humongously less expensive on a large scale, than pure EV battery conversions, and you would still put out 35% of the CO2 that gas guzzlers do!(that is a LOT less)

    Scientist are working now to use algae – specially DNA modified that can convert more waste material to methanol than we could convert natural gas!! Very efficient methods have been proven, and we could even use coal exhaust to do it. This at least is something that could start a science and infrastructure foundation, to renewable resources. Do not under-estimate the power of diatomic life; methanol could bury the oil companies in rapid succession, if the government would just support it.

    I suspect they already know this and are trying to obfuscate the subject matter! Even Alan Greenspan was confused at why methanol wasn’t chosen rather than ethanol, which is mostly food product(which has been torpedoed by the oil distribution industry as well!!)

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