How Electric Cars Can Be Profitable For The Public And Automakers

GM Showcases Electric Car On Capitol Hill
WASHINGTON - JULY 19: An electric cable is attached to the side of a Chevrolet Volt vehicle during a viewing on Capitol Hill July 19, 2007 in Washington, DC. The Volt is a plug-in electric vehicle which will run its first 40 miles without using any gasoline, and then the battery pack will be re-charged by a small internal combustion engine that runs on gas, diesel or ethanol when required. The vehicle is expected to be on the market by 2010. Photo : Alex Wong/Getty Images

Electric cars are already a reality, but it is a reality that not a lot of people can afford as of this time. The only way that auto manufacturers will be profitable at this point is to market these vehicles well and with a high price tag. That will not always be the case, however, as battery-run units will continue to get on the main street.

As GreenTechMedia reported, the appeal of gas cars is really just that they cost less than electric vehicles. The cost of the electric vehicle, in large part, is due to the excessive pricing of batteries. The interest of the public, however, is there and automakers are leaning more and more towards releasing more environment-friendly vehicle options.

The numbers have indicated that the Tesla Model S and Nissan's Leaf were the bestselling electric cars of 2016. They were followed by both BYD's Tang and General Motor's Chevy Volt. These companies have been more aggressive in tackling the growing industry, but this does not mean that other companies are just gazing past the new technology - they are simply waiting for the right and most profitable time to strike.

One way to make the industry more profitable is, of course, to offer lower-cost options. Tesla is already starting to get its feet wet with this, especially since the Model 3 costs significantly less than either the Model S or the Model X. But the publication argues that there is more to it than just offering a cheap alternative.

The Model 3 is a vehicle that boasts its ability to travel long distances on a single charge. And while this is a logical point to make, it is not one that is completely necessary. Most people tend to use their vehicles only within urban areas, with one destination not far from the other. A lower range and a lower price tag will appeal to the market. French company Renault has had some success in this with its Zoe, which has a 22-kilowatt hour battery pack.

Another is by widening its market reach. There are several types of buyers and each of these buyers will need to be sold on the idea of an electric car in different ways. While there are those that will require only short range vehicles, there are also those that will use the same sort of like a status symbol. There are also those that prioritize mass premium above all else, as well as those that require large family-friendly units.

Of course, there is also the need to educate the public on the benefits of electric cars. As Ergon AU notes, it will be a lot cheaper to maintain and run a battery-powered vehicle. In terms of maintenance, an EV will have less moving parts as compared to a gas-powered unit. This means less servicing and more savings. Meanwhile, it will be cheaper to run because gas prices continue to increase while the cost of recharging - if any - are more likely to stay stable.

The largest selling point, however, is that an EV will be more environment-friendly. It uses renewable energy, which means less pollution is generated. At the same time, eco-friendly materials are also generally used. The Ford Focus, for example, is made of recycled materials while its padding is made out of bio-based materials.

The appeal of electric vehicles are there - it just needs to be marketed in the right way. However, this also means that EV manufacturers will need to spend some time in figuring out how to package the technology. As it stands, the industry is simply too costly to appeal to the masses.

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