PARIS—Elon Musk has long had the stage to himself as he
championed zero-emission vehicles, and his upstart company, Tesla
Motors Inc., became the touchstone for battery-powered cars.
When nearly half a million Tesla fans paid $1,000 each this
spring to reserve the company's next-generation Model 3 ahead of
its late-2017 launch, many auto executives scoffed.
"Let's see if they can build them," Thomas Weber, board member
in charge of research and development at Daimler AG, said at the
time.
Now, the enormous hype around Tesla's Model 3 preorders, slowly
rising consumer demand and looming emissions regulation appears to
have jolted conventional auto makers into action.
At the Paris Auto Show, which begins this week, major auto
makers unveiled plans to accelerate development of electric
vehicles over the next few years.
Volkswagen AG, still reeling from its emissions cheating scandal
sought to show it had cleaned up its act. It presented a concept
vehicle, a prototype of a battery-powered, fully self-driving Golf
that the company said could go into mass production in 2020. The
company is planning to introduce 30 new electric vehicle models by
2025.
"This car is to fight Tesla and the others, not our conventional
competitors," said Herbert Diess, head of the Volkswagen
passenger-car brand. "We have to take them very seriously. It's not
rocket science. The other competitors are making great
progress."
Until now, government incentives have driven the adoption of
electric vehicles in many markets. Norway and the Netherlands, two
of the smallest auto markets, became the biggest markets for
electric vehicles through subsidies and other incentives to promote
electric cars, which are still more expensive than conventional
gasoline and diesel vehicles.
But over the next decade stricter emissions targets in Europe,
the U.S. and China will increase the costs of developing
conventional combustion engines. Falling battery costs will also
make electric vehicles more competitive. By 2030, AlixPartners, a
consultancy, predicts that electric vehicles will largely replace
diesel, especially in smaller cars.
"This will go down as one of those years where it all started to
change," says Andrew Bergbaum, managing director at
AlixPartners.
European Union sales of electric vehicles—battery-powered,
extended-range vehicles, fuel cell vehicles, and plug-in
hybrids—rose 17% to 70,127 vehicles in the first half of this year
from the same period last year, according to the European
Automobile Manufacturers' Association.
In Paris, Daimler's Mercedes-Benz unveiled a battery-powered
sport-utility vehicle, a direct competitor to Tesla's Model X,
which will have a range of 310 miles on a single charge and is
slated to launch in 2020. The vehicle will be part of a new
sub-brand of Mercedes called EQ.
Daimler CEO Dieter Zetsche acknowledged that manufacturers were
still suffering from an oversupply of electric vehicles in a market
where consumer demand remained weak because of the high cost of the
vehicles and a lack of charging stations, but suggested the
situation could change soon.
"When will the customer independent of regulation and
independent of incentives consider electric vehicles fully
competitive with combustion engines? We are convinced that within
our planning period we will see the tipping point," he said.
Sports car maker Porsche, owned by Volkswagen, took the wraps
off a plug-in hybrid version of its sporty Panamera sedan that will
combine a 462-horsepower 2.9-liter V-6 twin turbo engine built by
Audi with an electric motor that has 136 horsepower.
But Porsche's big leap into electric autos comes with its
Mission-E, which was unveiled at last year's Frankfurt Auto Show
and is expected to be built beginning in 2020.
Paris also will see the launch of a number of mass-market
electric cars.
Volkswagen plans 30 new electric vehicle models over the next
decade; by 2025, one of every four cars it sells will be pure
electric or plug-in hybrid, the company has said.
General Motors Co. launched the Chevrolet Bolt in the U.S. and
will follow in Paris with the Ampera-E, a battery-powered compact
that resembles BMW AG's i3 electric city-car.
Amid the rush, some are more cautious.
For instance, BMW recently extended the range of its i3, but the
model is struggling, selling only around 25,000 vehicles last
year.
Nevertheless, Ian Robertson, BMW board member in charge of
sales, dismissed criticism that the Munich-based company's electric
vehicle strategy was in disarray, saying the company was first
among its competition to build an electric vehicle.
"There are plenty of companies out there playing catch up. We're
delivering to real customers," he said.
Write to William Boston at william.boston@wsj.com
(END) Dow Jones Newswires
September 29, 2016 21:45 ET (01:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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