Big battery EVs take heat

The latest news from the world of electric cars can't be good for EV battery makers.

First, there was Toyota Motor Corp.'s recent announcement that it will cut its sales targets for the all-electric eQ city car in the coming year. In truth, Toyota's planned sales numbers for the eQ had already been miniscule, but the remarks that accompanied the announcement were the real problem. According to an article from Reuters.com, the giant automaker admitted it had misread the ability of battery technology to meet consumer demands.

"The current capabilities of electric vehicles do not meet society's needs, whether it may be the distance the cars can run, or the costs, or how it takes a long time to charge," said Takeshi Uchiyamada, Toyota's vice chairman, in the Reuters story.

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Then there was the September report from the non-partisan Congressional Budget Office (CBO), which questioned the value of tax credits for electric vehicles. The report, titled "Effects of Federal Tax Credits for the Purchase of Electric Vehicles," took special aim at pure electric cars with big batteries.

"Assuming that everything else is equal, the larger an electric vehicle's battery capacity, the greater its cost disadvantage relative to conventional vehicles -- and the larger the tax credit needed to make it cost competitive," the report stated. "Conversely, electric vehicles with small batteries are more cost-competitive."

Finally, there were the recent stories about the Nissan Leaf and Tesla Model S. Articles from greecarreports.com chronicled an ongoing battle between Nissan and some owners of its Leaf electric cars, as a result of those owners complaining that their batteries were suffering from premature range loss in hot climates. Meanwhile, a story in The Wall Street Journal suggested that Tesla Motors Inc., which makes electric cars with giant lithium-ion battery packs, warned investors that it is cutting its revenue targets for 2012 because it has fallen behind its production goals for the Model S electric car.

Some of this could be written off to the media's over-zealous, microscopic examination of the electric car business, of course. But not all. You can't blame the media when the sales figures of electric cars are so disturbingly low. The Leaf is a case in point: Nissan sold only 395 Leafs in June, followed by 685 in July, according to greencarreports.com.