hrough networks of dealers. The dealers take risks by owning inventory and building local relationships. Franchise laws exist in most states to protect dealers from the risk that suppliers could try to wipe out the value of their investment by cutting them out of the sales cycle. The laws were created to protect a Chevy dealer from GM, not to protect the dealer from someone introducing a better product.
As outlined in a recent article in the Wall Street Journal, gasoline car dealers are attempting to use these laws to prevent Tesla from directly selling cars in Texas, North Carolina, Minnesota and Virginia. I would rather the incumbent car companies spend the effort on designing an EV that can compete with Tesla. If you agree, a petition has been started that asks states to allow Tesla to compete directly.
One criticism of Tesla is that their products are only practical for wealthy consumers. With a current minimum price north of $60K, it seems hard today to argue with that position. On the other hand, most electronic consumer products tend to be extremely expensive in their early incarnations. How many people had cell phones 25 years ago?
I had the privilege of hearing Stephen Chu, the former Secretary of Energy, speak about the topic recently. He said that at current rates of improvement in battery technology, EVs would be clearly superior to gasoline powered cars by 2020. Chu showed a graph of declining battery prices over time. In 2007, it cost about $1000 to buy a battery that would store 1 kilowatt-hour (kwh) of energy. This is enough to power an EV for three to four miles. In 2012 the market price was down to $500 per kwh and he expected that to be near $200 by 2020. Additionally, he believed that Tesla may be ahead of the game and be currently producing these batteries at around $300 per kwh. The future is coming.
So, how was my test drive? In a word, it was outstanding. The car is fun, fast and stylish. I put my deposit down in June and took delivery in late July. With solar panels on the roof of our house, I am now driving the zero-carbon vehicle of the future.