Written by Miranda Marquit
Photo:elaine a's, Creative Commons, Flickr
Will electric cars ever really replace gasoline powered cars?
One of the things Big Oil companies might have to fear is the development of a practical and affordable electric car. And that is what is likely coming our way in the fairly near future. With instability reigning in top oil producing regions of the world, many people are jittery about relying on foreign oil and about the volatility of oil prices. This is providing some impetus to companies (including car makers in Detroit) to develop electric cars that work well and are reasonably priced. And, interestingly enough, CNN Money offers a look at just such a thing:
According to [Miles] Rubin, Founder of Miles Automotive Group, the XS 500 has a top speed of 80 miles per hour and a range of 120 miles at 60 miles per hour. That's about as fast as GM's late-90s era electric car, the EV 1. And the XS 500 will be a lot cheaper to produce, the company says. Cheaper, to the tune of about $30,000 to the customer. Not too shabby. And Miles Automotive Group isn't the only company getting into the game. There is competition from Phoenix Motors and Tesla Motors, and all of the big automakers are developing plug-in hybrids. While electric power has its own issues it is, so far, the most viable immediate option for powering cars with limited impact on the environment. And that's key. Easy-to-charge and drive practical electric cars that are more convenient and cost the same as gasoline powered cars.
So what about Big Oil? If affordable electric cars actually reach the market (there are still hurdles -- such as safety issues and battery testing -- that need to be overcome), this could mean Big Oil could face serious challenges to its current business model. Big Oil companies, like Exxon (XOM), that do not invest in any form of renewable or alternative energy, could find themselves relying on an outdated way of generating energy, and it could hurt the company's stock. And, as recent events and pollution concerns cast a baleful eye on coal for electricity production, it could be that renewable ways of producing energy, such as solar and wind power, may become more important.
Disclosure: I do not own stock in any of the companies listed above -- yet. I'm looking into buying stock in a company that produces an affordable and practical electric car, since I think that we might be ready to leave the 20th Century mode of energy (oil based) and move into the 21st.