Is America Ready For The Chinese Electric Car?
There's already been a documentary film that examined the death of the electric car, but perhaps the reports of the electric car's death, as the cliché goes, have been greatly exaggerated.
It's clear that recession has left the U.S. automobile industry crippled, but the current economic troubles will likely look like a small blip on the radar compared the damage that will be done if/when China starts making quality cars and selling them overseas. The latest news from the Chinese automobile industry is that one company is on the verge of a breakthrough with respect to reviving the electric car.
Investor, philanthropist and all-around rich guy Warren Buffet has seen the writing on the wall. His company, Berkshire Hathaway, recently spent $230 million to buy 10 percent of a Chinese company called BYD Auto that's known for their expertise in making cheap, rechargeable batteries. BYD isn't looking to power your iPod, though. They have bigger ideas, starting with electric cars.
Electric cars are obviously cleaner than conventional gas-powered vehicles, but they also carry the potential to be much cheaper because their engines are significantly more efficient. A typical gas-powered car can require over $1000 in fuel annually. An electric car can drive the same distance for less than $500. (These figures assume gas prices of around $2 per gallon and electricity prices of around 12 cents per kilowatt.)
BYD's first two all-electric cars (the company currently produces a hybrid like the Toyota Prius) will hit the market later this year. Initially, they will only be sold in China. Europe will likely follow, as gas prices in Europe are higher than in North America and electric cars will likely be a very attractive alternative. BYD hasn't yet determined when, or if, it will begin selling its cars in North America. However, if the company's vehicles can gain some traction (pardon the pun) overseas, it's probably only a matter of time.
Warren Buffet is already on board for the electric revolution. Will you be ready?