Daimler, BMW, VW race to catch up with EV, hybrid models
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FRANKFURT (Bloomberg) -- German automakers including Daimler, BMW and Volkswagen have spent much of the past decade fine-tuning their diesel and gasoline engines, letting Toyota race ahead in hybrid technology and more recently, allowing General Motors and the Renault-Nissan alliance take the lead in electric-powered vehicles.
Now the Germans are making up for lost time as all three big automakers expect to get electric vehicles into showrooms by the end of next year.
"German manufacturers slept through the hybrid trend, which eroded their image as technology leaders," said Peter de Haan, an auto markets analyst at consulting company Ernst Basler + Partner in Zollikon, Switzerland. "Electric drives give them the opportunity to recover."
Daimler will kick off the push in the coming weeks when it starts delivering an electric version of the Smart city car. At the Paris auto show this week, the manufacturer's Mercedes-Benz brand will present the SLS AMG E-CELL. The exhaust-free gull-wing supercar, to be available next year, has four electric motors that help it accelerate to 100 kilometers (62 miles) per hour in 4 seconds, just shy of the 3.8 seconds for the 571-hp combustion version.
The VW brand plans to introduce battery-powered variants of the Up city car and the Golf compact next year. Audi will start a limited-run two-seater called the R8 e-tron later this year, while deliveries of the Porsche 918 Spyder, a plug-in hybrid, will start in 2013.
BMW intends to roll out the i3 next year, which sports a weight-saving carbon-fiber body, the first offering in its "i" electric sub-brand. Then in 2014, the carmaker plans to introduce the i8 plug-in hybrid sportster.
French carmaker Renault and its partner Nissan, which makes the segment-leading Leaf EV, are unlikely to give up the advantage they've gained after investing a combined 4 billion euros ($5.2 billion) in electric cars. At the Paris show, Renault will introduce a compact called Zoe, its fourth electric model after the Fluence sedan, Kangoo delivery van and the Twizy, a four-wheel scooter with a roof.
For customers like Harald Geisbauer, a 52-year-old engineer from southwest Germany, the late entry of the German automakers to the market isn't enough to convince him to buy German. Geisbauer has meticulously planned his purchase of an electric car. For months, he has kept a driving log of his Toyota Prius to determine range, he has read volumes about electric cars, and has driven four of them. He won't be buying German: "BMW, VW and Mercedes have been very vague about when their vehicles will be ready," Geisbauer said after testing a Mitsubishi i-MiEV near Berlin earlier this month.
Tripling demand
With new models from the Germans and others, the market for electric-passenger cars will more than triple to 384,000 vehicles in 2014 from 102,000 this year, researcher IHS Automotive predicts.
Renault-Nissan's leading share of the segment will probably fall to 40 percent from 48 percent. Renault and Nissan, which is 43 percent-owned by the French carmaker, aim to deliver a cumulative total of 1.5 million electric vehicles through 2016. So far, they've sold about 77,000 cars, according to company data and IHS estimates.
The German entry may help Renault and Nissan meet that goal by raising the segment's profile after initial sales have been disappointing. Consulting company Frost & Sullivan reduced its forecast this year by 25 percent on signs that consumers remain concerned about the cost and range of the vehicles.
New technology
"There is a limited advantage of being the first movers" for Renault and Nissan, said Sarwant Singh, automotive partner at Frost & Sullivan. By educating customers on the concept, the French-Japanese auto alliance "had to do a lot of work that others have gained from."
For Daimler, introducing new technology is a key part of the company's drive to retake the lead in premium car sales by the end of the decade after falling to third, behind BMW and Audi, last year.
In addition to the SLS, the automaker will present an electric-powered version of the Mercedes B-class compact in Paris and plans to start deliveries in 2014. The manufacturer's Smart will also show a performance version of the electric Fortwo and a larger battery-powered concept in Paris as the brand looks to underscore its image as an urban pioneer.
French incentives
"I am very confident that we will make a large step forward with the e-Smart," CEO Dieter Zetsche said at a company event last week. Daimler plans to sell at least 10,000 electric Smarts a year, or about 10 percent of the two-seater's sales. At 18,910 euros for the car and 65 euros a month to rent the battery, the two-seater undercuts most rivals, including the Renault Zoe, which will cost 20,600 euros without a battery. In Renault's favor is the fact that the French government, which owns 15 percent of the manufacturer, is supporting electric-car sales with an incentive of 7,000 euros toward the purchase of battery-powered vehicles.
With no similar programs, Germany's automakers may be at a disadvantage as they scramble to get a piece of "the pie," said Christoph Stuermer, a Frankfurt-based analyst with IHS. With their financing and distribution muscle, he said, the Germans will help boost interest in the entire segment. "There is no pie there yet," Stuermer said, "so the increase will be massive."
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