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Algora Publishing - Carmakers pin their hopes for electric car sales on fleet buyers
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Carmakers pin their hopes for electric car sales on fleet buyers
GM claims that it will cost just 60p-70p for the electric charge needed to run the Ampera 40 miles
Financial Times

Carmakers pin their hopes for electric car sales on fleet buyers
Higher capital costs are likely to prove prohibitive for private consumers, writes John Reed

   General Motors brought a prototype of its Opel/Vauxhall Ampera electric car to Europe for the first time this week to attract customers for what it calls its most important new vehicle.

   The car, known in the US as the Chevrolet Volt, will not go on sale in continental Europe until late 2011, with the right-hand drive model ready for the UK in early 2012.

   However, GM has begun pitching the car to potential corporate and government buyers including London’s Metropolitan Police, which plans to use low-emission cars during the 2012 Olympic Games.

   The Ampera is a four-seater, with bucket seats in the back to accommodate its large T-shaped battery pack, which GM says will shrink in size as technology improves.

   The Detroit carmaker is marketing not just the car, but its technological solution to the trade-offs all producers of plug-in cars face between battery power, price and driving range.

   The Ampera has a small petrol engine and generator that power its motor when its battery is depleted. GM claims this will eliminate “range anxiety” experienced by drivers of pure electric cars such as Nissan’s forthcoming Leaf.

   Unlike petrol-electric hybrids such as Toyota’s Prius, GM says its Ampera is always driven by its electric motor. This week it was touting the car as “the world’s first extended-range electric vehicle”.

   To demonstrate the Ampera’s driving range, GM drove the prototype 175 miles between its two UK plants. It said its final production version could make the 350-mile round trip without refuelling

   Duncan Aldred, Vauxhall’s managing director, described the test drive as “truly a red-letter day” for the brand.

   The public relations stunts are essential for a class of car that will get much of its initial business from fleet buyers, and rely on generous government subsidies to attract private consumers.

   The Ampera will cost £30,000 in the UK, not including a £5,000 government subsidy available for low-emission cars. GM admits it will not make money on the car initially.

   GM thinks that Britain, because of strong central and local government support for electric cars, will be the Continent’s leading market for them, however.

   This week in London, Toyota launched a three-year leasing programme for a rechargeable version of the Prius. On Monday, the Japanese carmaker will host Vince Cable, Britain’s business secretary, at its plant in Burnaston, Derbyshire, for the production launch of its Auris hybrid, for which it is also lining up fleet buyers when it goes on sale in July.

   “We’ve got a lot of interest from people who want to take the car from day one,” says Mark Roden, general manager of fleet services for Toyota and its Lexus luxury marque.

   Nissan and its associate Renault have also been securing a range of partnerships with companies and regional authorities in Europe and globally.

   “The fleet sector is nearly 50 per cent of the new car market, so it’s absolutely crucial,” says Greg Archer, managing director of Britain’s Low Carbon Vehicle Partnership. “Particularly with electric vehicles, the higher capital costs are likely to be initially prohibitive for private buyers, but the much lower running costs will be recognised and realised by fleets.”

   GM claims that it will cost just 60p-70p for the electric charge needed to run the Ampera 40 miles.

   The sales jobs come amid growing doubts in the sector about whether consumers will buy enough electric and rechargeable hybrid cars to repay carmakers’ investments, or decision makers’ wagering of public money to support them.

   EurotaxGlass, which publishes the UK’s leading used-car guide, has warned that electric vehicles’ residual values could plummet by as much as 90 per cent within five years because of concerns about their batteries’ performance.

   To address these anxieties, GM is offering a 10-year warranty on the Ampera’s battery

Carmakers pin their hopes for electric car sales on fleet buyers