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PHEV Economics

Discussion in 'Tesla, Inc.' started by tonybelding, May 10, 2007.

  1. tonybelding

    tonybelding Active Member

    Aug 17, 2006
    Hamilton, Texas
    Some people have been pointing toward plug-in hybrid electric vehicles (PHEVs) as a stepping stone towards pure battery-electric vehicles (BEVs).  From a technological standpoint I can see that.  From an economic standpoint, I'm not so sure.

    You need to take into account the hundreds of millions of gasoline-powered vehicles already on the road, and what's going to happen to them, because they aren't going to just evaporate.  When people start switching over to electric cars in large numbers, you can imagine the prices of gasoline cars will collapse.  Used gas cars will be dirt cheap.  Some may be converted to electric drive, but sheer numbers suggest that most of them won't be.  For the person trading up to an electric car, there won't be a lot of incentive to sell off the old car -- they wouldn't get much for it.  Instead they may feel inclined to keep it for those occasional long highway trips.

    If you have both a new electric car and an old gasoline-powered car in your garage, then you don't need a PHEV.  The main problem a PHEV was meant to solve -- limited driving range -- is not a problem for you.  And since you are driving the electric car most of the time, the gas car could last you a very long time before it ever wears out.  By the time it does wear out, BEVs may then have 500+ miles range and PHEVs will effectively be obsolete.

    Some people simply can't keep two cars, because they don't have room, or for other reasons. . .  and for them a PHEV may be a fine thing.  However, a lot of people in this country already have two or more cars, so this multi-car scenario I've described isn't a big leap for them.
  2. Michael

    Michael Member

    Aug 25, 2006
    I would agree that those of us looking to buy a vehicle in the near term; at least until BEV's are able to reach a much longer range, and there is an infrastructure established to get a quick (er) recharge, it's very likely that a PHEV will be the vechicle of choice. I would imagine that we're still quite a ways off from achieving this mass conversion so ICE vechicles won't be losing all their value overnight, although I also would agree that the depreciation should excelerate during the transition.

    I, for one, have no interest in having to maintain two vehicles, so I'm motivated to focus on a solution that doesn't require significant compromises.

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