An ambitious plan to build an electric vehicle infrastructure in tiny Israel has backfired as the company, Better Place, announced on May 26, 2013 that it was closing its doors. It seems that for every two steps forward taken in the EV world, there are just as many two steps back.
I have written about the challenges EV technology faces, the need for an infrastructure as reliable and ubiquitous as that which supports internal combustion engines. But alas it doesn’t exist. Better Place, an Israeli company, hoped to build stations throughout the country and when launched confidently predicted 100,000 EVs on the country’s roads by 2010. That of course has not happened. Today, with the demise of the company, three dozen EV switching stations are now orphans without much of a future unless someone else picks up the ball.
Initially the company raised almost $850 million in private capital but has spent much of it while going through multiple CEOs, each trying to make the business model work. Part of the problem was overly optimistic forecasting. The other was the lack of EV manufacturer support with only one, Renault, signing up with its Fluence Z.E. EV sedan. The EV had to be redesigned to make it easy to switch out and replace the battery. The Fluence , seen below, has a battery range of between 80 and 200 kilometers (50 to 120 miles) between charges, with an estimated battery recharge life of 3,000 charging cycles.
Better Place’s business model was built on the premise that a cheaper EV could be built if the battery were taken out of the cost equation. Every Better Place EV car customer would:
- Buy or lease an EV easily accessible, switchable battery.
- The customer would beg given unlimited access to a lifetime of batteries.
- An EV owner would charge his or her car at home or at work every day.
- If needed the EV owner would visit a Better Place switch station and replace the battery.
- As new battery technology came out, Better Place subscribers would automatically be able to get the most up-to-date technology.
- Upon resale the EV would retain better street value because the battery technology would be current.
But the optimistic forecasts of 100,000 EVs on Israel’s roads by 2010 never materialized and Better Place’s business model just “ran out of charge.”
With the liquidation it is hoped that the existing subscriber network and switching station infrastructure will continue to function. But who knows. In the article that appeared in the New York Times, Isabel Kershner described Better Place as a vision that was ambitious in a company “hobbled by problems and delays.” In the end less than 1,000 Israeli subscribers signed up with several hundred more in Denmark, not even close to the 100,000 initially anticipated by the founder. So a Better Place turned out to be “not so much.”