Energy Business

An Electric Cadillac No One Will Drive

General Motors (NYSE: GM) will build a Cadillac fueled by electricity. And it will be added to a long line of new electric-powered models that are unlikely to have many buyers.

The world’s largest car company announced that “The Cadillac ELR will feature an electric propulsion system made up of a T-shaped lithium ion battery, an electric drive unit, and a four-cylinder engine-generator. It uses electricity as its primary source to drive the car without using gasoline or producing tailpipe emissions. When the battery’s energy is low, the ELR seamlessly switches to extended-range mode to enable driving for hundreds of additional miles.”

GM’s first electric-powered car — the Chevy Volt — has been a failure. Only 125 were sold in July. Recent research on inventory indicates that most dealers have the car in stock. The electric-powered car market is tiny, primarily because alternative products are more popular and practical.

Volkswagen has advanced the cause of clean diesel engines in the U.S. These vehicles get nearly 50 MPG and the technology behind them eliminates nearly 90% of the sooty emissions associated with earlier diesel-powered cars.

The larger challenge to the Volt and the Cadillac ELR is that hybrids like the Toyota (NYSE: TM) Prius are still the preferred cars for people who want gasoline-driven vehicles. Toyota said in April that it had sold more than a million Prius vehicles in the U.S. since the car was introduced. The gasoline-electric hybrid, which gets more than 40 MPG, has become the favorite car in its class.

JD Powers issued a report last year that explained why demand for electric cars will be small in the next few years. “Combined global sales of hybrid electric vehicles (HEVs) and battery electric vehicles (BEVs) are expected to total 5.2 million units in 2020, or just 7.3 percent of the 70.9 million passenger vehicles forecasted to be sold worldwide by that year,” the research firm wrote. The primary obstacles to electric car sales are their relatively high sticker prices, concerns about their short driving ranges and confusion about where they can be plugged in.

GM and other car companies continue to press the advantages of electric-powered cars with gaudy introductions of products like the Cadillac ELR. The truth is that almost no one wants to own them.

Douglas A. McIntyre

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