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CalCars Declares Plug-In Victory; Next: Fun Factor + Retrofits

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  • Felix Kramer
    We just spoke at the first large-scale conference in Detroit on plug-in cars, The Business of Plugging In. Speakers at this high-level event, organized by
    Message 1 of 1 , Nov 5 5:51 PM
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      We just spoke at the first large-scale conference in Detroit on
      plug-in cars, "The Business of Plugging In." Speakers at this
      high-level event, organized by the auto industry's leading
      research/analysis/conference group, the Center for Automotive
      Research, with founding sponsors DTE Energy, the University of
      Michigan and GM, included Michigan's Governor Jennifer Granholm and
      William Ford, Jr. We decided this was as good a time as any to make a
      long-awaited statement. While cautioning that "We still face a lot of
      steps between here and successful commercialization," we said, for
      the first time, we were "taking this occasion to DECLARE VICTORY --
      plug-in hybrids are coming!" Following that we outlined our view of
      the road ahead, including introducing the most challenging audience
      to our Gas-Guzzler Conversions campaign. You can see what we said
      below. We follow that with excerpts from a story about why fun is a
      key ingredient to successful commercialization. And we wind up with
      the first major national media report on our new conversions campaign.

      (Shortly after it goes out on email, this posting will also be
      viewable at http://www.calcars.org/news-archive.html -- there you can
      add CalCars-News to your RSS feed.)

      http://www.calcars.org/ice-conversions.html -- renamed "Join the
      Campaign to Electrify World's 900+ Million Vehicles (as many as
      possible, to plug-in hybrid or all-electric)." That page has links to
      11 small companies and projects that are the early entrants in what
      we believe will be a booming global opportunity. We also point from
      there to our one-page campaign description and endorsement form, plus
      links to our presentations, flyers and White Paper.

      THIS CONFERENCE FEELS DIFFERENT: Over and over, that's what we heard
      Detroit attendees say. Pressed to explain, most said they felt it was
      appropriately named "The Business of Plugging In:" everyone
      understood the benefits and wanted to find the most effective ways to
      advance the technology and the companies and organizations across the
      industry, the nation and globally.

      Happily all-business now comes with a twist, best captured in "Fun
      could be the key to selling plug-in hybrid autos," an article by
      automotive reporter Sharon Silke Carty ,
      . Here are excerpts quoting two speakers from our session plus a keynoter:

      At a three-day conference on the future of plug-in hybrids, one
      lingering question kept coming up: Who's going to buy these things?
      The answer, according to outsiders and industry leaders here: no one,
      if they're not fun to drive. Fun to play with. And fun to look at.
      Naturally, people want safe and reliable cars, but, they said, the
      key to wide public acceptance of more expensive plug-in and electric
      cars is making them fun. "We're asking, 'Can you give us the next big
      thing? Can you make a profit? And can you make it fun?' " said Wesley
      Clark, former presidential candidate and keynote speaker at the
      Business of Plugging In conference. "If you can do that, it's a whole
      new age for Detroit and a whole new age for America."

      Tony Posawatz, vehicle line director for General Motors' Chevrolet
      Volt, said GM is working to educate consumers. "Our job is to make
      this something they fall in love with, so they're not talking about
      the (higher sticker price than a similar gas-engine car). They're
      talking about how they want the car," Posawatz said. John Waraniak,
      vice president of vehicle technology for the Specialty Equipment
      Market Association, said every electric and plug-in hybrid will need
      to wow buyers. "That cool factor is critical to acceptance of green
      vehicles," he said.

      "The Consumer: Who, When and Why?" (agenda at
      http://www.pev2009.com/program/index.asp#w_bs1_3 ).


      By session moderator Brett Smith, director of the Automotive Analysis
      Group, at the Center for Automotive Research (CAR) in Ann Arbor
      Michigan, organizer of The Business of Plugging In 2009 Conference.

      Our next speaker is Felix Kramer. I had the chance to meet Felix
      actually several years ago very briefly and then last November out in
      California at a meeting of the Volt people and several folks from the
      community in California who are very passionate about this subject.
      At the end of the day, Felix gave up and gave what Iand [GM's] Rob
      Peterson -- I don't think Rob is in the room -- and I agreed, was the
      most amazing speech we had ever heard. This was right at the stage, I
      think it was the day that the Big Three chief executives were on
      Capitol Hill, and the mood was so bad, you remember. Felix got up, a
      real California guy, being someone who's been passionate about the
      environment for a long time, got up and gave a speech that was just
      stunningly thoughtful on why we need our automotive industry to
      succeed to get to this point. And Rob and I looked at each other and
      said, "Yeah, he gets the PEV part but he also gets the importance of
      the industry as a whole." Our next speaker is Felix Kramer from
      CalCars Initiative.

      [Felix Kramer]

      So I want to talk about what we've learned from conversions, and what
      they tell us about future consumer demand. Seven years ago, I started
      CalCars.org to put plug-in hybrids on the map. From 2002 to 2005, all
      we heard was "Nobody's interested, nobody wants to plug in -- there's
      no business case, there's no benefit, and the carmakers will never go for it."

      Andy Frank, meanwhile, did the first retrofits, mostly on big GM
      vehicles, and almost five years ago we brought the first Prius
      conversion to Detroit to show to an automotive reporter. On the way
      back we stopped at the Center for Automotive Research to show them a
      plug-in hybrid.

      After us, hundreds of Prius conversions and Ford Escape conversions
      gave a glimpse of the future to a lot of important, critical people
      -- some journalists, think-tank people, C-level executives, elected officials.

      And those vehicles enabled us to communicate three powerful slogans
      that became kind of memes: "100+ miles per gallon" (with a footnote
      "plus a penny or two a mile of electricity"); "Good enough to get
      started" with the technologies we have now -- good enough to get
      started; and "Cleaner, Cheaper, Domestic" as a way of describing the
      benefits of electricity compared to gasoline.

      And then they also enabled us to show this [a short "dongle" cord,
      with a regular 110 electrical plug on one end and a plug for the
      vehicle on the other] and get a laugh from people, saying "every
      alternative fuel source needs a new infrastructure and new
      technology; this connects us to today's infrastructure." And that was
      a really very powerful message.

      So, with the help of a broad coalition that began to form, most of
      those objections fell away in 2006 to 2008.

      We still face a lot of steps between here and successful
      commercialization. But today, for the first time, I'm taking this
      occasion to DECLARE VICTORY -- plug-in hybrids are coming! And we
      actually haven't had a chance -- you know, we've been working so hard
      all the time -- to actually say, "Look what we've done! We've made
      this happen. We've made this amazing change."

      [Gas-Guzzler Conversions]

      Now before I go on to talk about the market, I want to talk about a
      major new development, which I think will become part of the "What
      comes next?" story.

      Having achieved our primary goals, we started to look at how long it
      takes new vehicles to penetrate into the market. It took hybrids 10
      years to become 1% of the fleet and 2% of new cars. If you take that
      and you multiply [it] by a highly optimistic 10x factor, 15 years
      from now, we will still have a dribble of new plug-in vehicles in the
      market compared to 250 million vehicles in the United States and 900
      million in the world.

      That means that during those 10 to 15 years, we won't get the
      petroleum-reduction benefits we need. So, that leads us to a new
      goal: we're pointing to a global business opportunity to fix the
      vehicles that are on the road today.

      Intel's former CEO Andy Grove likes to talk about big gas-guzzlers,
      PSVs -- Pickups, SUVs and Vans -- as the market (and I'd add
      municipal and school buses and some other vehicles to that), and he's
      a big fan of this strategy, although there's a lot of skepticism
      about it. We think it's possible to retrofit to safe, drivable,
      validated EVs or PHEVs, depending on the drive cycle and the
      technology and construction of the vehicle, millions of vehicles.

      So, we're launching a new campaign that's spotlighting a few
      prototypes from small startups. We're collecting endorsements and
      getting a lot of partners on board about this. We want this effort to
      happen in two years instead of seven years. I'm happy to talk about
      it, give you a flyer, and all the info about it is at CalCars.org.

      [Expectations & Our Challenge]

      So back to the questions that we want to talk about here. 2010 is our
      real major unexplored frontier and our most critical year. The
      vehicles are coming this time -- not prototypes, not conversions, but
      real production cars. And they're going to come into a kind of
      twilight zone, at an unusual intersection.

      On the one hand, you've got the public -- with its understanding, its
      conceptions and its misconceptions, its expectations and its hopes
      that somehow there's going to some sort of solution that's going to
      get us out of this problem, this situation. And they'll bring all of
      those expectations to their encounters with multiple flavors of
      vehicles -- from small manufacturers and from large companies.

      So, they're going to start to see what plug-ins can deliver and
      there's going to be some mismatch in their thinking. And we hope that
      they'll recalibrate their expectations in healthy and enthusiastic
      ways. But that's not guaranteed.

      Automakers and the broad community can take a lot of steps to
      influence this unpredictable journey. The actions and communication
      strategies that we choose can significantly improve the chances of
      successful commercialization.


      So my predictions: I think the first vehicles will be gobbled up by
      early adopters. I think for a long time, carmakers will sell as many
      as they can build. I think the early buyers are going to self-select,
      based on the drive cycles and access to home or business charging.

      If 50% of the population has access to a plug right now, that's not a
      niche -- that's a huge market and we don't have to worry for a long
      time about where people are going to plug in. Plenty of people can
      start by plugging in.

      And millions of people are going to pay for features, just like they
      do for every kind of car. They'll pay for the green feature, the
      smart feature, the cool feature, the advanced-technology feature, the
      prestige feature. And all of those features get communicated by
      positioning, by design and by advertizing.

      So how many people are we talking about? Let's take one example:
      there's an acronym LOHAS, the LOHAS community -- Lifestyles of Health
      and Sustainability. It's a marketing category and people estimate
      that over 50 million people in America, 25% of adults, are willing to
      pay more for products where they will get the features that appeal to
      the LOHAS mentality. That again is not a niche.

      Now one caveat to all the predictions that we've been reading about:
      they are all based on "BAU" -- Business As Usual. Business As Usual
      -- I don't think is likely in the next couple of years. It could come
      from bad news: higher oil prices, international crises, supply
      disruptions. We could move at any point to a post-Pearl Harbor
      situation where we say we've got to retool the whole country because
      we don't have guaranteed access to oil any more.

      It could also come from positive steps, like carbon credits and
      additional incentives on local levels.

      [Redefining the Customers' Role]

      So now, I'm really encouraged that the carmakers see as their allies
      and -- this is in contrast, in some cases, in the past -- not only
      the utilities, but plug-in advocates, communities, and regional
      efforts like project Get Ready -- and I highly recommend that you
      look at http://www.projectgetready.org .

      So it's now possible for carmakers, the media and advocates to use
      new communications tools to give voices to the future drivers who are
      going to be the first owners of plug-in cars. These customers and
      future customers can describe now what they hope for, and when they
      start getting them, they can say what they like and what they'd like
      in version 2, because we're talking about automotive software now, to
      a great extent, and hardware, but a lot of it is -- version 2 can go
      right into their car, some day in the future.

      So, let's think of all of those customers as a giant fan club and as
      a focus group.

      For the roll-out in the next year, I think the guiding principle for
      all of us should be the ones that GM embraced when it announced the
      Volt: transparency and two-way communications at every stage.

      This year, just like those demonstrators' cars, those conversions for
      all of those years, the cars are going to do us a big favor and give
      us the biggest boost yet. They give us the chance to personalize the
      experience and for people to communicate their own personal
      experiences. We can enlist every new driver as an advocate -- at
      least for their families, their friends and their neighbors and coworkers.

      But I expect, actually, many of them will jump in an become amateur
      evangelists to audiences who want to hear all about this. And I can't
      wait! Thank you.

      Please review http://www.calcars.org/calcars-bigfix-endorse.pdf ,
      then send us your company/organzation's endorsement or your personal
      endorsement if you're a high-profile individual or active advocate.

      background: CalCars completed its first Prius conversion in fall
      2004. That news didn't reach major public awareness until Spring
      2005, with major profiles and features in the NY Times, Business
      Week, Newsweek, etcv (That story is told in Sherry Boschert's book on
      PHEVs -- see http://www.calcars.org/books.html -- and you can find
      the news clips at "CalCars in the News 2004-2005"
      http://www.calcars.org/kudos.html . But in late January, well before
      that, Mark Clayton at the Christian Science Monitor wrote "Hybrids?
      Some Opt to Go All-Electric," describing our project. Now Clayton
      returns with the first national story on our new campaign -- and he
      gets it all right! Here it is, filed at CSM under "Innovation."

      "Electric SUVs: A smaller footprint for big vehicles: Converting
      existing gas-guzzling trucks and SUVs into hybrid and electric
      vehicles gains traction."

      By Mark Clayton | Staff Writer for the Christian Science Monitor /
      November 4, 2009

      Tom Reid likes his ride big -- a 2000 Ford Explorer SUV with plenty
      of interior room and all the amenities. None of those prissy little
      hybrid vehicles will do for him.

      But after gas hit $4 a gallon last year, Mr. Reid had a big fuel
      bill, too -- and an epiphany: convert his gas guzzler to an
      all-electric vehicle.

      So he did. Now Reid's bright idea has become a sideline business for
      his shop, HTC Racing, which produces specialized protective coating
      for automotive and other metal parts in Whitman, Mass. He offers kits
      to convert any 1995-2004 gas-sucking Ford Explorer into a
      cheap-to-keep, no fuel, little maintenance all-electric SUV. Cost: $15,000.

      He admits that the idea may be "ahead of its time." Reid has yet to
      sell a single kit. With gas at only $2.50 a gallon, the conversion
      cost is too much for even SUV-loving die-hards. But if gasoline
      prices soar again, Reid says he'll be ready -- and he won't be alone either.

      Converting America's vast existing fleet of gas-guzzling SUVs and
      pickup trucks into electrified vehicles is an idea percolating among
      policy wonks, start-up companies, and fleet owners such as FedEx and
      the US Postal Service.

      Despite all the hoopla over Detroit's move to make plug-in hybrid and
      all-electric vehicles, there's a need for a speedier US shift away
      from oil in order to enhance energy security and slow the buildup of
      carbon in the atmosphere, says a small but growing chorus.

      President Obama has set a goal of 1 million plug-in vehicles on the
      road by 2015. But with 260 million cars, SUVs, and light trucks on
      the road today, new electrified vehicles won't arrive in sufficient
      volume to yield a significant benefit on reducing US carbon dioxide
      emissions or oil consumption for at least 15 years, says Felix
      Kramer, cofounder of the California Cars Initiative, an advocacy
      group that promotes plug-in electric-gas hybrid vehicles.

      What that means is that conversions will be needed -- and the best
      place to start is with gas guzzlers, Mr. Kramer says .

      They point out that even if all new cars sold in America were
      electric by 2030, they would only represent a third of US vehicles.

      "We're happy automakers are changing -- but new plug-in vehicles
      sales can't do the job alone or anytime soon," he says. "It's clear
      [new plug-ins] will initially be a drop in the bucket. So we have to
      change over existing vehicles -- we need conversions."

      A big part of the problem is vehicle longevity. It takes 15 to 17
      years for a typical vehicle to go from showroom to junkyard crusher
      -- and sometimes longer for SUVs, pickup trucks, and vans that have
      sturdier frames.

      In the scenario where 100 percent of new car sales are plug-in hybrid
      vehicles by 2030, US oil consumption would fall by just 21 percent
      and carbon emissions by 15 percent because of the millions of
      remaining gasoline cars, estimates a California Cars Initiative white paper.

      But with an active conversion program that included tax incentives,
      the number of plug-in vehicles would roughly double to about
      two-thirds of the fleet by 2030. That would produce a 36 percent cut
      in oil use and a 25 percent chop in CO2 emissions.

      The reason to focus on gas guzzlers rather than gas sippers is the
      much bigger benefits from electrifying them. When Kramer of the
      California Cars Initiative converted his Toyota Prius hybrid into a
      plug-in hybrid with more electric power -- the car went from 50 miles
      per gallon up to 100 m.p.g. But the United States could save far
      more, he says, if it converted existing pickup trucks that get 15
      m.p.g. to vehicles that can go 30 to 40 miles on a charge before
      shifting to gas.

      And that's the aim of Ali Emadi, president of fledgling Hybrid
      Electric Vehicle Technologies, a Chicago spinoff of the Illinois
      Institute of Technology. His young company has just converted its
      first Ford F-150 pickup truck from a 16 m.p.g. gas hog into a plug-in
      hybrid that gets up to 41 m.p.g. gasoline equivalent.

      "Our technology could be applied to almost any vehicle from SUVs to
      pickup trucks, buses, or even school buses," Dr. Emadi says. "The
      important issue is that when you apply our technology to larger
      vehicles -- trucks and buses -- the fuel economy savings and return
      on investment are much more attractive."

      Unlike Reid's all-electric approach, Emadi's company plans to add an
      electric drive system to an existing internal combustion engine to
      create in essence a retrofitted plug-in hybrid vehicle that runs
      primarily on electricity. But once the battery is depleted after 15
      miles or so, it can continue running on its internal combustion
      engine while recapturing braking energy just like a standard hybrid.

      Emadi is in talks with potential customers. Big commercial fleets of
      pickup trucks, SUVs, and vans seem likely to be the first arena where
      the economics line up and gas-guzzler conversions get the go-ahead.

      FedEx, the big delivery company, began retrofitting some of its
      trucks to standard hybrid models. But its president, Frederick Smith,
      says that, in the long term, the company "would likely convert a
      substantial portion of our fleet to the new plug-in hybrid technology."

      Bright Automotive, an Anderson, Ind., startup, has its sights set on
      building a new commercial 100 m.p.g. plug-in hybrid van it calls the
      IDEA. But until it wins funding it is focusing on converting
      Volkswagen's Transporter van from a 15 to 22 m.p.g. vehicle to a
      plug-in hybrid workhorse that goes 22 miles on all-electric and 57
      m.p.g. across its 50-mile daily drive cycle.

      Earlier last month, Inglewood, Calif., announced it had tapped REV
      Technologies, a company in Vancouver, British Columbia, to convert
      its existing fleet of 21 Ford Escape SUVs into all-electric vehicles
      that get 100 miles on a charge.

      "When you just look at the sheer number of cars on the road, they're
      not going away anytime soon," says Jay Giraud, president of REV.
      "People are saying, 'I want to keep driving what I've got -- I just
      want it to be electric.' "

      Making a similar point in dramatic fashion, Raser Technologies in
      Provo, Utah, unveiled a converted plug-in hybrid "extended range"
      Hummer that gets 100 m.p.g., according to the company. Raser is
      trying to sell its technology to a manufacturer and has no current
      plans to convert existing vehicles, a spokesman says.

      Which leaves Reid wondering when gas prices will rise high enough
      that individual consumers begin converting their beloved SUVs, vans,
      and pickup trucks. He also wonders why those fat federal tax credits
      of $7,500 for new plug-in hybrids like the upcoming Chevy Volt don't
      yet apply to converted all-electric vehicles or plug-in hybrids that
      accomplish the same fuel savings and environmental benefits. Why not
      a "cash for conversions?" Kramer adds.

      "If the government would help with a reasonable tax credit, you'd get
      all these entrepreneurs like me converting all kinds of vehicles for
      maybe $10,000," Reid says. If gas rose to $4 or more a gallon, he
      figures his SUV conversion to electric-vehicle kits would be selling
      like hotcakes.

      "The way I see it, Americans have a love affair with their SUVs," he
      says. "None of my friends want anything to do with little cars -- no
      matter how high [the price of] gas goes."

      -- -- -- -- -- -- -- -- -- -- -- --
      Felix Kramer fkramer@...
      Founder California Cars Initiative
      -- -- -- -- -- -- -- -- -- -- -- --
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