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Can Battery Electric Vehicles Break Out Of Niche?



Better Place And New Alliances Create Scenarios To Expand Market Beyond 3 Million By 2015

Boston, MA - 24 March 2009 - The Strategy Analytics report, "Battery Electric Vehicles: Will New Activity Drive Market Out Of Niche?" reveals that without new breakthroughs in business models and technology, the demand for battery electric cars will grow, but only to less than 500,000 units a year by 2015. However, new investment activity could create annual demand for 3 million units, generating over $1.1 billion of new semiconductor demand.

Electric vehicle market growth is driven in part by increasingly onerous mandates on fleet fuel economy and on carbon dioxide emissions, as well as consumer demand for more environmentally-compatible vehicles. Although electrified powertrains in general are seen as an answer, battery electric vehicle technology is currently flawed. Problems--such as high cost, short range and slow recharge--have held back mainstream consumer adoption. New battery technologies aim to address many of these problems, but the high cost and uncertain longevity of batteries will remain a barrier.

Initiatives, such as Project Better Place, the Silicon Valley company that promotes electric vehicle use, encourage new business models to overcome consumer apprehension. A series of projects developing recharging infrastructures, battery replacements and pay-per-mile usage are just some of the development proposals considered at this time.

According to the author of this report, Kevin Mak, Industry Analyst of the Strategy Analytics Automotive Electronics Service, "Better battery technology will not be enough to propel the electric vehicle into the mainstream within the next five years. Investment in re-charging and battery-swap infrastructure will be required to make electric vehicles anything other than a niche solution."


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