Mercedes-Benz USA Boss: Electric Car Revolution Is More Than A Decade Away

1 year ago by Eric Loveday 112

Mercedes-Benz Vision Tokyo

Mercedes-Benz Vision Tokyo

Mercedes-Benz' Dietmar Exler

Mercedes-Benz’ Dietmar Exler

At an Atlanta Press Club event last week, Mercedes-Benz’ U.S. boss told the Atlanta Business Chronicle that although electric cars do pose an existential threat to the gasoline car, that threat is “more than a decade” away.

According to Exler, there are a few things holding back electric cars. Exler believes that batteries are still too expensive and that the used-car market for electric cars is problematic. Quoting Exler on price:

“It’s all well and nice to [offer] an electric vehicle. But, if the average consumer can’t afford it, we have a problem.”

And here’s Exler’s comment on the used-car market:

“Would you be comfortable buying a four-year-old electric car that might not have a warranty on the battery?”

Neither comment has much truth to it though. As we know, there are cheap electric cars out there and additionally, the battery packs usually carry a warranty of well over 4 years, so Exler’s comments make little sense.

Exler even took some time to take a shot at Google. This comment is in reference to M-B’s autonomous driving package:

“It’s a production car. It’s not the Silicon Valley cars with 15 sensors on top that look like (they’re) from Mars.”

“Our cars — the E-Class and S-class — can do autonomous driving today. The law does not allow us to do it.”

Source: Atlanta Business Chronicle

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112 responses to "Mercedes-Benz USA Boss: Electric Car Revolution Is More Than A Decade Away"

  1. tftf says:

    I would probably say “only” 5-7 years away for mass-market car instead of a decade but otherwise I fully agree with him (which may irk some readers on this site, but it’s the truth).

    1. tftf says:

      PS: And there won’t be a revolution, but a slow evolution imho. Why?

      Long replacement cycles for cars as well as low gas prices coupled with transitional PHEVs and finally missing infrastructure for home renters (homes without a garage for overnight charging).

      It will takes decades, not years, before BEVs take over significant car marketshare.

      1. ItsNotAboutTheMoney says:

        Depends how you look at it.

        Viewed in terms of the fleet, it’s guaranteed to be evolutionary, but for manufacturers and new car dealers, what matters are being able to sell new cars.

        The current evolutionary limitation is not the replacement cycle, it’s the fact that there will need to be a massive expansion in battery and component manufacturing, as well as support systems.

        And, for any company, it’s also not just about volume, it’s also about margin and ROI. If BEVs expand in the premium segment, as I expect, it’s going to have significant impact on ICE technology investment.

        In my opinion, automotive execs need to be thinking about 5 years, rather than 10.

        1. wavelet says:

          If it’ll take a decade or a bit more, the heavy investment needs to start 4-5 years from now, and, given that that there are various new techs involved, the decisions about them need to be taken _NOW_.
          Including stuff like hiring, funding research in academia, etc.

          It’s like the old adage about generals who are preparing to win the last war, not the next one.

      2. beta995 says:

        Exactly. EV’s are replacing ICE cars in the lux category already at 10%. Stay Asleep MB, that just makes Tesla stock even stronger.

        For a compelling product people are willing to step out of the 11 year upgrade cycle.

        1. wavelet says:

          “For a compelling product people are willing to step out of the 11 year upgrade cycle.”
          Especially given that for luxury cars, that cycle is 3 years, not 11. Virtually no S-Class or 7-series customer holds on to a car more than 3 years (whether leased or bought).

      3. Sublime says:

        The other aspect working against a quick revolution is that the more popular EVs get, the cheaper gasoline will get.

        1. Dragon says:

          Seems to me that gas is about as cheap as it’s going to get. On the other hand, the more EVs, the fewer customers gas stations have and eventually some will close, making gas increasingly inconvenient to find, leading to higher EV sales. Problem is that will probably take awhile.

          It took 50 years for ICE to replace horses in all industries so it’s going to be hard to push the EV transition a lot faster. Unfortunately the physics of climate change don’t give us 50 years to get off gasoline.

      4. martinwinlow says:

        I’m assuming you haven’t heard that both Norway and The Netherlands (not to mention India) are both committed to banning the sale of FF cars by 2025? I’m guessing they think Herr Exler is wrong.

        IMO, the only thing holding back EVs are people like Exler.

        1. arne-nl says:

          Netherlands is not committed.

          The real situation is that the parliament has urged the government to make a law to that effect. But there is nothing concrete yet.

  2. Anon says:

    Yes, the electric car revolution for Mercedes Benz– is at least a decade away…

    1. ffbj says:

      Right. Bloomberg thinks it will be sooner for one particular car maker:
      http://www.bloomberg.com/news/articles/2016-04-21/tesla-changed-cars-forever-now-it-must-deliver

    2. Scott Franco says:

      Just as is their profitability.

      1. Beta995 says:

        State of the art battery factory, and charging infrastructures are ASSETS on the balance sheet, in the BILLIONS.

        Musk isn’t shipping profit to an off-shore tax haven.

  3. Kdawg says:

    “It’s all well and nice to [offer] an electric vehicle. But, if the average consumer can’t afford it, we have a problem.”
    ———
    Wait, what!? Since when does Mercedes Benz make affordable cars for the average consumer?

    1. Jérémie Olivier says:

      +1

    2. Forever Green says:

      +1 Kdawg

    3. Charbar says:

      Beat me to it!

    4. Seth says:

      +1

      And it didn’t even have fast charging, that is an outright sin on a BEV.

    5. Vin says:

      They’ve been making affordable cars for a while. CLA and GLA MSRP start at $32.5K and can be had for less than that. So an entry-level ICE MB is about as cheap as an “affordable” Model 3 will be.

      A B250e can be had for even less. According to Edmunds, a 2016 with the Premium package can be had for ~$35K, and that’s before $7500 from the feds and whatever the state will cough up ($2500 for me in CA). So that’s $25K for a new 2016 MB. That is well below the average transaction price of $33.6K as reported by USA Today last May.

      Everyone here seems to agree that the Model 3 will be “affordable” at $35K. I totally agree. I just wish some of you guys would actually do some homework before crapping on the manufacturers that are cranking out product that we can afford to drive TODAY.

  4. Will Davis says:

    I HATE his arrogance. He claims his cars can already do autonomous driving, but the law prevents it. I call utter BS. If an S-class can navigate UK roads from one side of the country to the other on all road types, then Mercedes would be incredibly stupid to not be pushing this amazing tech as hard as they possibly can

    1. mr. M says:

      Maybe they are pushing it to little, but please try the E-Class autonomous drive before you criticise it.

      1. Anon says:

        It has been reviewed (smoothness of lane keeping, etc.), and did not score as highly as Tesla’s Beta Implementation.

  5. Rick Danger says:

    The biggest thing holding back electric cars is the fact that Tesla doesn’t have Apple’s billions to invest in them.

    1. Speculawyer says:

      Tesla has not had a problem raising cash in the recent years.

      And with the 400,000 Model 3 orders and SpaceX landing a rocket upright on drone barge out in the Atlantic, I don’t think Elon Musk will have problems raising billions more as needed.

      1. Rick Danger says:

        How many Gigafactories, auto factories and Superchargers could Tesla have on tap with $180 billion to spend?
        How far along would Model ≡ be right now? Model Y?

        1. Terawatt says:

          If Musk thought more money would help him reach goals faster he’d simply raise more money. He could even pay for another parallel gigafactory out of pocket using his personal wealth.

          Tesla may of course still raise more capital, and it’d be a little surprising to me if they don’t, considering the rethink of production plans and all.

          If they had 180 billions stuffed away when this all started it probably wouldn’t have worked. When your survival depends on success you pull out all the stops. When 5% of your savings might evaporate unless you’re successful you probably don’t try as hard.

          1. arne-nl says:

            “out of pocket using his personal wealth.”

            What utter BS. (Sorry, couldn’t resist)

            His personal wealth are in large part shares in Tesla, so what you are saying is that he has to sell those to invest in Tesla. Haha.

    2. Rich says:

      No doubt. Tesla is the tip of the spear. Apple is the spear head, spear shaft, and the 100 megaton nuke at the end of the shaft.
      Apple moving to make a BEV, should keep legacy automakers up at night.

  6. Rick says:

    Sounds like sour grapes to me, kinda like Lutz and Marchione.

  7. G2 says:

    MB is still needing to sell ICE cars that they are so heavily invested in, so what else would he say except statements intended to cool demand for EVs and keep stockholders from jumping ship?

  8. Murrysville EV says:

    He’s right about the used car market.

    My $38k 12 Leaf went for $6-7k at auction in 2015. Its battery SOH was 85%, falling about 6% annually.

    The battery directly drives the resale value, and customers are justifiably wary of used EVs.

    Just because a used EV still has some utility for somebody, it is definitely not the same utility it had when new. ICE cars don’t suffer like this since their range never changes.

    1. The Leaf is on the very bottom of the scale for resale because it is one of the few EVs with an air cooled battery which, in early models especially, had degredation problems. Teslas have retained value very well compared to other premium cars.

      Price pressure from new cars with $10k incentives is another issue.

      The second hand buyer is the big winner.

      1. Scott Franco says:

        No. Most leaf owners don’t have this issue (including me). Its been overblown here.

      2. Murrysville EV says:

        Your speaking like an enthusiast, which most people aren’t.

        My Leaf lived in western PA, where it was subjected to mild heat, but rough winters. I’m tired of the “Leaf + heat + no cooling = battery problems” argument, because my battery still suffered in spite of gentle treatment in a cooler climate.

        Deep cycling is very detrimental to lithium ion batteries, which the Leaf endures due to its small battery. Teslas don’t have to deep cycle like a Leaf.

        The second-hand EV buyer is a winner only because they got the car cheap, and they knew what they were buying. The average car buyer (new or used) avoids EVs like the plague.

        Moreover, the additional hurdle of needing a Level 2 charger at home is a big one. Sure, you can trickle charge from 110V, but it’s not practical. When the average Corolla buyer hears they need to get a $500 charger for their EV (likely installed professionally), they move on.

        The True Believers here need to put themselves in the shoes of their mother, next door neighbor, a single mom, etc. and ask themselves why that person wouldn’t buy an EV. The reasons are manifold.

        1. Kdawg says:

          I think the Leaf did suffer a lot of resale value loss due to many factors.

          Regarding Tesla, they put out this in 2013 to help with resale worries.

          “Buying a Model S through the Tesla financing offering now comes with a guarantee that the resale value will be higher than that of BMW, Audi, Mercedes, Lexus or Jaguar.”

          https://www.teslamotors.com/blog/tesla-improves-financing-product-best-resale-value-guarantee-and-lower-monthly-

          1. Anon says:

            Elon just tweeted this about the Model X resale value. Got a chuckle out of it:

            1. kdawg says:

              Yeah, I saw that yesterday. I wonder when he finds time to read. And I also wonder if he ever peruses this website.

        2. Terawatt says:

          The batteries in the LEAF have largely fared very well, according to all the data I’ve ever seen. Anecdotes can’t refute that, yours included. In all probability you were very unlucky and happened to get one of few bad batteries.

          If you have stats that show there really is a problem with the battery, let me know. I may be wrong and when I am I appreciate being corrected.

          If you think anecdotes and personal experience are intelligent ways to assess the facts, let me share mine as well: I got a 2012 LEAF, imported from the US, one year ago. It’s driven 45,000 kilometers now in temperatures from -17 to +28 (Celsius), though mainly between 0 and 15 Celsius, and I cannot detect any difference so far in available range. The capacity meter indicates twice out of twelve. I realize it’s possible that the meter doesn’t show a linear 0-100% scale (and I do find this sort of manipulation dishonest and deceitful), but it seems to me I have the same capacity as a year ago so I believe it’s in a fairly good state.

          My experience and yours tell us nothing about the quality or life of the LEAF packs in general. A proper assessment requires at least an unbiased sample of 30 or so. (Seeing 30 people writing angrily about their bad battery isn’t an unbiased sample, of course.)

          1. Murrysville EV says:

            As I mentioned below, my battery was declared OK by Nissan.

            I kept track of the during the last 6 months I had it using LeafSPyPro, which told me its state of health was 85% when I traded it.

            There is a disconnect between the indicated bars, and actual performance. Nissan won’t replace a battery unless it hits 8 bars, or has bad cells. By then, the car is almost useless.

            I assume you mean your Leaf has a 10-bar battery (lost 2 of 12 bars), which is actually degraded worse than mine was at the same mileage. Good luck with that.

            By the way, there are MANY unhappy Leaf drivers out there. My anecdotal story is just one of them. I really liked the car, but less so at the end.

      3. Pushmi-Pullyu says:

        @electric-car-insider.com

        Well said!

        Just because the Leaf has poor resale value doesn’t mean that, going forward, EVs in general will. The Leaf was poorly designed, with no battery thermal management system. The poor used car value is an accurate reflection of that.

        Contrariwise, Tesla cars have been shown to have excellent retention of battery capacity, and the surprisingly high resale value of the Tesla Model S is at least partly due to that fact.

        Now, not all EVs are going to retain their value as well as Tesla cars currently do, because demand isn’t so high for others. But the Leaf resale value doesn’t inform what the resale fraction will be for the average 200+ mile EV.

        1. Terawatt says:

          Well, you’re right that poor second hand value for EVs in general doesn’t follow simply from an example of one EV that exhibit this trait.

          But look at the reasons and it’s clearly applicable to EVs today and for a long time to come. Tesla is in fact the exception, not the rule. I think that’s simply because they’ve been production constrained for a long time and there is similarly not enough used Model S cars to cover the demand at lower price points. Eventually however, when Tesla has made all the cars they can sell for a few years, this situation will normalize.

          Looking ahead, incremental cost reduction, capacity increase, faster charging, wireless charging, and autonomy features all point to cars that improve faster than before, and EVs improving much faster than other vehicles. The economic laws should then ensure a poor second hand value when compared to what’s typical today and for the past several decades.

          On the other hand, once EVs are in a more direct competition with ICE, fast-improving EVs will put pressure also on the price of used ICE vehicles. Personally I’d be most sceptical, even from just a financial point of view, to buying a diesel, because they may be banned from city centers on days with especially poor air quality, which obviously would make them less attractive).

          In short EVs will almost certainly retain their value poorly compared to what cars used to do. But this will likely apply to ALL cars, and it’s not at all certain that EVs will fare any worse than ICE. And with an EV, if the price crashes completely, you can recoup your losses simply by sticking to the car. Both the ICE and the EV after all depreciate to zero eventually, and the savings from lower running and maintenance costs with the EV will far exceed the remaining value of the ICE at the end of the EVs life. I bought a used LEAF knowing it would probably depreciate fast, but from a relatively low base. It doesn’t matter to me if I lose 30% of $100 or 10% of $300 since in both cases I lose $30.

          1. Pushmi-Pullyu says:

            Terawatt said:

            “Looking ahead, incremental cost reduction, capacity increase, faster charging, wireless charging, and autonomy features all point to cars that improve faster than before, and EVs improving much faster than other vehicles. The economic laws should then ensure a poor second hand value when compared to what’s typical today and for the past several decades.”

            Hmmm, well that goes against the typical improvement curve for new tech, in which they improve rapidly in the first few years, but then the law of diminishing returns kicks, in, and improvements become more incremental.

            We can see this already happening in BEVs, with ranges jumping from an average of 80-85 miles to 200+ miles, all at once. We won’t ever again see a more-than-doubling of range between one generation of EV and the next.

      4. Speculawyer says:

        Tesla has retained value because there is an army of people that would love a Model S but can’t afford $80K for a car . . . however, if they stretch, they can afford a $50K used one. So there is a big market people that can’t afford a new Tesla but would love to get one on the used market.

        1. TomArt says:

          That, and the fact that Tesla’s packs are swappable – easy to upgrade/get a new one, for a price, or a refurbished one, for a little less. We’ll see how that plays out – the oldest S isn’t through the 8-yr battery warranty yet.

      5. Aaron says:

        None of the Mitsubishi i-MiEV owners have reported significant degradation either. It also uses an air-cooled battery.

    2. Jérémie Olivier says:

      Range of ICE cars also drop with time, because of wear of the engine, of the ball bearings, etc.

      1. Murrysville EV says:

        No it doesn’t, not by 6% annually.

        Besides, a total engine swap in an ICE costs a fraction of what an EV battery costs.

        1. beta995 says:

          It’s not 6% annually for anyone.
          ( except this guy. )
          That should be covered under warranty.

          1. Murrysville EV says:

            My car still had 12 bars when it was traded.

            Nissan declared its battery to be A-OK when I complained about its 36-mile range in the winter. No warranty claims, then.

        2. Big Solar says:

          ICE motor swap costs about the same as a battery swap. Unless you are comparing a 97 Jeep wrangler to a 90D Tesla.

          1. Peter says:

            But ICE engines usually last the lifetime of the car, batteries don’t.

            1. Nick says:

              That’s almost a circular argument.

              It rarely makes financial sense to replace an engine, so when the engine dies, the car is at end of life.

        3. Djoni says:

          I’m sorry for your case and so many others, but 84% after 4 years is 4% losses per year.
          I still have 86% for my MY2012 Leaf after 105 000 kilometers.
          Sure the value of the car has plummeted, but it still running great and does everything I need to do with it.
          I know if I want to sell it when I’ll have my Tesla 3, there will be the possibility to install a lizard battery in, albeit not a 30 kWh yet.
          But who know in 3 years what will be the option.

          1. Murrysville EV says:

            No, I said 85% after 3 years.

            Battery degradation is an exponential curve, which makes my losses about 5.3% per year.

            My car was running great when I returned it last year, but it had practically no used car value. Nissan took the loss, which is what I suspected when I leased it to begin with.

    3. Someone out there says:

      Yes but the $38k price tag is the early adopter price, of course they are going to depreciate fast once the technology takes off like all new technology.
      It’s not just about battery warranty either. Once the $35k-$37k 200+ milers are out, who would pay any significant money for a car that only goes 87 miles? Even new LEAFs are going to have to take a significant price cut once the Bolt is out, until the next gen LEAF.

  9. PVH says:

    I remember myself foolishly saying 5 years ago to whomever with enough patience to listen to me that EV car revolution was only 5 years away. Given glacial pace all this is moving despite hype machine EM I think I better shut up rather than saying this guy is wrong. Also, current low fuel price does not help.

    1. TomArt says:

      The claim may have been optimistic, but in some respects, it depends on how you look at it.

      As someone else mentioned above, new car sales is all automakers make money on (repairs go to dealerships).

      When taking that into consideration, we know that the EV revolution already struck in 2015 for poor old M-B. They’ve already lost their luxury sales leadership to Tesla Motors, no only in the US, but also in their own backyard of Western Europe!

  10. EV sales will nearly double next year in the US.

  11. Jérémie Olivier says:

    New title for this article: ”Mercedes-Benz USA will see a dramatic drop in their sales in less than a decade.” In fact, it’s happening right now. New EV tech is more expensive initially (to buy) from the consumer, but MB clients can easily afford that.

    1. Fred says:

      Hahaha! Excellent! But yeah, it is true, it will still take some time before EVs are the majority. This has more to do with fear, mental laziness and latency then technology progress, but hey. Growth should accellerate very quickly now, but let’s see.

      1. Scott Franco says:

        They don’t have to be the majority. At about %25 of new car sales as being EV, the entire market will be sliding sideways. It would be a sea change. And by market I don’t mean just cars. Imagine %25 less customers for gas stations.

  12. John C says:

    One thing to remember is that the industries being disrupted usually have their stock value destroyed many years before the event actually comes.
    Investing is mostly a long game and are you now interested in holding stock in this company if it admits disruption is coming??

    1. beta995 says:

      What they say publicly and what they spend in R&D are two different things. Didn’t MB bump up their EV R&D?

  13. Sparkinator says:

    Carefully crafted message. If my bonuses were dependent on selling fossil fuel vehicles, I’d say that too. If he said that EVs are coming hard and fast, he would have to direct buyers to other manufacturers, since the current MB offerings are negligible. They would look stupid for not having an aggressive EV lineup in development. Like so many of his ilk – they just hope that this EV fad will go away. But, in their hearts they know that fossil fuel cars are running around with tombstones in their eyes.

    1. arne-nl says:

      Nicely put.

  14. Mel4EV says:

    I’ll go along with the title. A revolution is big stuff and we’ll see some good Evolution before then!

  15. CDAVIS says:

    Revolution: “a sudden, complete or marked change in something”

    —–

    In the large luxury sedan category Tesla is outselling Mercedes in North America and Mercedes’s Western Europe home market (that stat is not a typo). In Western Europe Tesla is also outselling Audi large luxury sedans and BMW 7 Series while Tesla continues to grow market share in all of Europe.

    Tesla will soon be producing the Model 3 (with already 400,000+ deposit reservations in hand many of those European) intended to target the much higher volume mid-level luxury sedan category.

    …..and Mercedes in the face of that is saying “Electric Car Revolution Is More Than A Decade Away”???

    Amazing….

  16. Texas FFE says:

    This guy is crazy! Maybe the EV revolution is ten years away for normal people cars but not for luxury cars. If Mercedes doesn’t get on board with EVs real soon they they are going to get their socks blown off by the likes of Tesla, Porsche, Audi, BMW, Cadillac, etc., etc.

    1. TomArt says:

      They already have by Tesla – a small margin, yes, but they lost market leadership in the US and western EU in 2015.

  17. ffbj says:

    “The Emperor has no clothes.”

  18. Kevin Z says:

    If the electric cars look anything like the one pictured, I don’t think there will ever be a threat.

    1. Pushmi-Pullyu says:

      LOL! 😀

      At least not from Mercedes-Benz.

    2. Seth says:

      The one electric car they do have (The B Claas ED) doesn’t have DCFC, what does that tell you about how serious they are.

      “There was no quickcharge standard we liked”.

      No, in that case you put in atleast a 11kW 3phase charger, or just insert a Chademo plug until you finally have the plug that you want (CCS).

  19. David Murray says:

    I still agree with him, though. Sure. there were be some market penetration of EVs over the next few years. But as far as getting the mass market to shift. Yeah, that’s at LEAST 10 years away. Remember trucks and SUVs are the largest segments now and there are essentially no contenders available in those segments (don’t make me laugh at the Volvo and BMW PHEVs with limited range and a very high price tag) In fact, there aren’t even any vehicles ANNOUNCED. and considering how long it takes to develop a new vehicle, yeah, 10 years is quite reasonable.

    1. Jahav says:

      Perhaps in US.

      In EU, with high taxes on gasoline and the fleet-wide 95g CO2/km EU limit, it will be sooner than that. For vans, it will be 147 g CO2/km.

      95g CO2/km is equivalent to 4.1l/100 km of gasoline or 3.6 l/100 km of diesel. No way you can make that without considerable amount of EVs.

      Not sure if I should be annoyed or delighted. In any case, EVs will make up a considerable share of cars by legal necessity.

  20. Get Real says:

    Translation:

    “We at Mercedes have fallen hopelessly behind in electrification because we thought that it would go away. Therefore we would like to sell you a dinosaur and if you have lots of money we will sell you a performance-modified dinosaur.”

    What a joke, anyone (like the notorious short-selling anti-Tesla poster tftf) thinks that Mercedes is correct here they are deluding themselves.

    Mercedes did not have the foresight to develop its own electric drivetrains or perhaps even more importantly, battery supplies so now Tesla is eating their lunch.

    What is also stupid is the remark by his boss that Mercedes dwindling customer base wants more AMG versions rather then electric.

    One of the most important reasons that luxury buyers are switching to Tesla is because an electric drivetrain done properly IS very high performance.

    What is happening in this segment will soon move down segment and that will be the revolution.

    1. Stephen Hodges says:

      I wonder what words taste like? I think Mr. Exler may be going to find out long before ten years from now. My suggestion to Elon, announce a Model 1V, a smaller car than the M3, to be made in factories in China or India or Europe (or all!). Give the competition plenty of time to attempt to “Bolt” the door on it. That and maybe the E150 (Kwh) pickup. Let the scrambling begin!

  21. Scott Franco says:

    I agree. This guy sees it as evolution. Its going to be a revolution (the famous S curve). The first is walking slowly into high water. The second is being hit by a wave.

  22. Big Solar says:

    There are cars from Mars?

    1. Speculawyer says:

      Yeah, that concept car is amazingly silly.

  23. Speculawyer says:

    Yeah, it is a decade away . . . for Mercedes Benz. Meanwhile Tesla and GM will roll forward with it.

    Mercedes has no good battery source and that is gonna hurt.

    1. Mike I says:

      M-B boss recently said that there is an oversupply of batteries. They are right. If you pony up the money there are many companies that have capacity to build you very good EV battery cells. All you have to do is integrate them into a battery pack tailored for your vehicle. That is what M-B is doing, investing in the expertise to take commodity cells and build battery packs. The problem is that by relying on outside suppliers for battery cells, they don’t have any control over the cost of the cells. This is why Tesla will have a competitive advantage.

  24. Pushmi-Pullyu says:

    “Would you be comfortable buying a four-year-old electric car that might not have a warranty on the battery?”

    Apparently you’ve never heard of Tesla Motors’ CPO (Certified Pre-Owned) program? I understand they’re doing quite well with selling used Model S’s at a surprisingly high fraction of new car price.

    “It’s all well and nice to [offer] an electric vehicle. But, if the average consumer can’t afford it, we have a problem.”

    Now there, you have a valid point. So if your argument is that the tipping point at which the average car buyer starts seeing EVs as preferable to gasmobiles is more than a decade off, I agree with you.

    But the EV revolution is happening right now. Unless you’re living under a rock, you must have heard about the incredible number of reservations Tesla is getting for its forthcoming Model ≡.

    1. arne-nl says:

      “But the EV revolution is happening right now.”

      That was the first thing that crossed my mind as I read the headline.

      In my mind, the EV revolution started with the successful production ramp of the Model S. That proved that an EV could be made that is just as good and even better than a comparably priced ICE vehicle.

      From that revolutionary point onward, it is evolutionary progress that will gradually make EV’s cheaper and better until they beat their ICE counterparts in every price segment.

      Sitting around and waiting until EV’s have taken over the market and then declaring “hey, it seems we have a revolution” is not what is expected of you if you are an auto industry exec.

  25. Volt says:

    10 years away for Mercedes

    the rEVolution has been going on

  26. Someone out there says:

    Those are the words of an obsolete company. The revolution has already started and it will accelerate quickly from here.

  27. Speculawyer says:

    “It’s all well and nice to [offer] an electric vehicle. But, if the average consumer can’t afford it, we have a problem.”

    Says the company that pretty much makes no products that the average American consumer can afford.

  28. James says:

    I agree with this assessment. Of course, the Chinese market. Is maturing much, much faster, which is good and bad. Too much coal.

    I think that short-range EV’s like the Leaf ultimately handicapped the electric car market, but Tesla has singlehandedly redeemed it. Problem for old-school car companies is servicing a dying market and falling behind. No other car company is making a truly compelling EV for fear of cannibalizing their profitable gas cars, which is why we have joke cars like the Mercedes B. No CEO wants to take the big risk of making a real Tesla competitor, because then all their gas cars look like garbage.

    1. arne-nl says:

      “I think that short-range EV’s like the Leaf ultimately handicapped the electric car market,”

      There are still more than a 100 thousand happy LEAF customers. Happy for Nissan to have had the balls to market an affordably priced EV and otherwise unable to experience the joys of electric driving.

      Nissan haven’t handicapped anyone, they deserve credit for sticking out their neck.

  29. Mark C says:

    I like the way he mentioned the average customer being able to afford it.

    MB isn’t exactly for the “average” customer, but more an aspirational vehicle. Well, at least to those who haven’t looked into Tesla YET.

  30. PVH says:

    As for the problem of used EV depreciating fast, he is, for the time being, 100% right hovewer. Car makers needs to make EVs with a possibility to easily upgrade the battery. Maybe Renault got it right after all (ownership of car but lease of battery). The Tesla is keeping a good value second hand because of the extended warranty which is costing a harm to Tesla (see Bjorn long list of items that were fixed/changed on his car).

    1. TomArt says:

      Generally speaking, yes.

      However, Tesla’s packs are swappable (at least Model S), so that makes it easy mechanically to upgrade. A 10-yr-old Model S can get a new pack, or a refurbished pack, for a price, a software upgrade and a 1.5-minute swap at a service center.

      1. arne-nl says:

        Isn’t the LEAF pack easily replaceable? Maybe it takes some extra time, but how much will that add to the cost?

  31. RobSez says:

    The core of what MB is saying is true. The EV revolution IS coming. That’s the bottom line and the most important thing said here.

    Yes, the innovation and technological advancements are moving at a glacial pace. Yes, the price is still too high. Yes, we need to do more to expand the charging infrastructure. Yes, we need to do a much better job of educating the public. finally we early adopters and EV enthusiasts need to put more pressure on the car makers themselves to actually advertise and make an effort to sell the cars they are building.

    Car makers are only required by law to build their ‘compliance’ cars. Not to actually sell them. Be honest folks, if it’s not a Tesla, it’s a compliance vehicle. We need to find a way to convince car makers that selling the compliance cars as ‘green’ is a waste of time. Let’s get them interested in selling a car that people want: Fun, fast and cheap to operate. If we can’t get these great cars to sell, the revolution is pointless.

    1. arne-nl says:

      “Yes, the innovation and technological advancements are moving at a glacial pace.”

      No they aren’t. They are going very, very fast. You just have to take into account that this is the auto industry we’re talking about, not mobile devices or software. Everything is relative.

  32. TomArt says:

    “Electric Car REvolution is more than a decade away”

    yeah…says the guy who just got their lunch money stolen by Musk in 2015…hey, genius! Who’s the luxury sedan market leader in NA and western EU? Huh? I can’t heeear yoooouuu!

  33. Four Electrics says:

    I doubt it’s a decade away–I predict that the regulatory environment will soon shift against carbon-based vehicles due to the increasingly invisible effects of climate change. This will manifest as tougher CAFE-like standards as well as heavy carbon taxation.

  34. Anti-Lord Kelvin says:

    I wonder, ten years from now what will be the top battery of a Model S of that time… Maybe something like 150 kWh with 450 miles of range and a P version with 2,2 seconds 0 to 60 mph Ludicrous and a quarter mile in less than 9 seconds? And I even not would imagine the Tesla Roadster figures of that time. The 3 will be at his third generation with 400 miles of range and we could have a Model 4 even less expansive than the 3 (25000$ ? ) as Elon said yesterday in Norway that would give to the compact ICE Mercedes Class A a very hard time like the Model S is giving to the Class S now!

  35. Bob Nickson says:

    A decade isn’t very long.

  36. floydboy says:

    Why does that car look like a Japanese anime creature?

  37. Mxs says:

    Quite agree with him, however bitter it tastes to most of the readers here.

    On the other hand, decade is pretty short time.

    1. arne-nl says:

      I would define the start of a revolution as the moment after which the further unfolding of events became unstoppable.

      As a thought experiment, apply it in hindsight to another market. When did the mobile communications revolution start? Most would say with the introduction of the first portable telephone. Even if its weight was measured in kilograms and the price more than $ 10,000. The subsequent evolutionary improvements and optimizations that are almost a force of nature in our mass production and mass consumption society, lead, after a few generations, to a device that was appealing to the majority of consumers.

      Wrt EV’s I think have already passed the moment of unstoppable, so the revolution is well underway. Why? Because the price of batteries that GM pays to LG is $145 per kWh, and at that price, the EV is more attractive than an ICE at almost any petrol price.

      And from this point onward, it can only get better.

  38. bevoreno says:

    Coming from someone who builds a product that yields 40% revenue from maintenance and replacement of it’s inferior parts that wear out at a constant, endless rate, his point-of-view comes at no surprise.

  39. zzzzzzzzzz says:

    Battery warranty is mandated by legislation to 8 years in the US. It doesn’t apply in Europe. E.g. Leaf warranty is 5 years and 60,000 miles there if I’m not mistaken. You can make these 60,000 miles in 4 years or less as well. And used battery car residual value isn’t good as you would expect for any new rapidly advancing technology product, so Exler is exactly correct.

  40. Rick Bronson says:

    While Tesla Model-S sales have increased in 2016-Q1, that of Benz S Series and all other luxury sedans have crashed.

    Let these guys keep believing in the old world.

    1. Terawatt says:

      How is staffing the obvious to live in one’s own world?

      Look, if everything goes 100% to plan with Model 3, and they manage to get to 500,000 per year in 2020, what percentage is that of the car market? Less than 0,5 percent! By 2020 more than one hundred million new cars will be produced in the world.

      If “everyone” else then copied Tesla, built a gigafactory, and got to 500,000 EVs each by 2025, we’d be looking at something like ten million (20 manufacturers each making half a million) or a bit less than ten percent of new cars.

      I don’t think it’s physically impossible to change much faster than this, even to make only EVs five years from now. But short of governments banning tailpipes things are going to move at a much lower pace than that.

      If “the revolution” means the point in time where mainstream manufacturers place EVs front and center of their efforts and stop investing in combustion-relating tech, then a decade from now is probably near the mark.

      The best way to accelerate the transition would be to tax carbon so it’s price better reflects it’s total cost, including damage to environment and health (today’s price merely reflects the cost of extracting it, which is likely much less than half the total cost!). Then capitalism could do it’s resource-allocating job and produce more rational outcomes – not just for cars, but wherever carbon is burned and there’s another way to do it with lower total cost.

      1. arne-nl says:

        As I have pointed out to others, the start of the revolution is not when EV starts taking over the market en masse.

        Imo, the revolution has already started.

        If you don’t start NOW planning ahead, you’re bound to end up as another Kodak.

      2. arne-nl says:

        And to expand a little, the start of the revolution is where things became unstoppable.

        Not the point where everybody joined the choir: “Hey, it seems we have a revolution”.

  41. JimGord says:

    “Electric Car Revolution Is More Than A Decade Away”
    TRANSLATION: Far enough away for us to get our asses in gear and catch up.

  42. Levy says:

    I have a Class B electric. Great car, Tesla inside! Too bad the executives of MB are not as good as their engineers…
    My next car is already bought, TESLA. Chew on that MB.