New Start-Ups Race to Build Green Car

Posted: May 6, 2008

Tesla.  Fisker.  Th!nk.  Loremo.  Mindset.  Not the nameplates you expect to see when you go car shopping?  Give it a few years, and these names may well be above Chevy and Toyota on your list.

The Wall Street Journal explains, "Spurred by the belief that the market for fuel-efficient vehicles is about to take off, a slew of tiny car companies is springing up in Europe and the U.S."  The companies "are racing to produce the next 'green' car, betting that soaring demand will allow them to survive alongside the giants of Detroit, Stuttgart and Tokyo."  Most are less than a year old, "and have financial backing from venture-capital firms," and engineers and designers who cut their teeth creating new cars for "the likes of Germany's Volkswagen AG and storied U.K. racecar builder McLaren."  Many of the companies hope to build and sell their own cars, while others "hope to outsource manufacturing to bigger companies, or even to sell the technology altogether, taking advantage of a growing trend among large auto makers to buy key technologies from outside firms." 

SoCalTech says that Southern California is "The New Detroit" for green car firms.  Industry analyst Andre Peschong of Bridgewater Capital told SoCalTech, "Southern California is the home to a myriad of design studios for all the major car companies.  There is a talent pool of engineers, CAD design specialists and let's face it, a car culture."  Perhaps as a result, there has been "an influx of capital into the region, looking for big returns" over the last year.

Among the most promising of the new green car manufacturers is California's Tesla Motors.  Tesla's Roadster, an electric two-seater that claims Ferrari-like performance and clean emissions, is already in production.  The Wall Street Journal's Environmental Capital blog says "The advent of Tesla is the latest sign that, when it comes to the environment, marketers are betting that well-heeled eco-minded consumers want to have their cake and eat it too. Tesla is selling its metal on sex-appeal, not sacrifice."   

It seems to be working.  Slashdot reports Tesla "has taken 600 orders for the Roadster and has a waiting list of another 400."  Buyers can order a Tesla now for about $124,000, and expect delivery in fifteen months.

Tesla's biggest early rival is Fisker Coachbuild.  Wired reports that Fisker's Karma sport sedan "is a marvel of design and engineering."  Fisker "claims the car's lithium-ion batteries provide 50 miles of emissions-free full-electric driving, and the Q-Drive hybrid drivetrain -- a small four-cylinder engine attached to a very large generator -- purportedly propel the Karma from zero to 60 in 5.8 seconds and to a top speed of 125 mph."

Henrik Fisker, the company's founder, once penned designs for high-end sports cars for Italy's Pininfarina design shop, and led design for Aston Martin.  Ironically, Fisker also contributed to the design of a sedan Tesla planned to manufacture, but the two companies are now locked in a legal battle over some components of the Karma that Tesla claims it holds patents for.

Norwegian Th!nk Automotive plans to bring its small electric cars to the U.S. soon.  Cutting Edge says the Th!nk two-seater should cost "less than the price of a Prius," and be available in 2009.  Wired says "The battery-powered Think City has a range of up to 110 miles on a single charge, with a top speed of about 65 mph, company officials say."

The start-up firms' greatest competition, however, may come from names you know well.  GM hopes to sell its Volt plug in hybrid by 2010, Toyota has a new Prius on the way that may get more than 90 mpg, and several other mainstream manufacturers are working to develop "green" car technologies. 

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