In The Slow Lane

For Linda and Michael Pearce, the barrier to totally green driving was, literally, a hill. The Seattle couple had long eyed an electric car for ecofriendly jaunts around town, but required one that could comfortably reach their home, set on top of a moderate 3.2km slope. Until a few months ago, none of the pint-size vehicles could manage that at speeds faster than a crawl. Then, several manufacturers came to market with more powerful drive systems to replace the slower, weaker motors that have powered non-automotive vehicles from golf carts to forklifts for decades. Now the Pearces are weighing their options. He favors the Miles, a four-door import from China; she, a diminutive Canadian two-seater called the ZENN (for "zero emissions, no noise"). "I like the one that can haul stuff," says Michael. "She thinks the ZENN is cute."

It's the first time there's been as much momentum around plug-in vehicles since General Motors built—then crushed—a test fleet of electrical vehicles in the 1990s. Back then, there was plenty of hype around zero-emissions automobiles; this time around, manufacturers have been, as they say in business, "managing expectations." Under the radar, a selection of zero-emissions cars has crept onto global markets over the past few years thanks to entrepreneurial start-ups that constitute the industry's green underground. Sales so far are tiny—only in the thousands—but mass-market production will begin this year. Billed as anti-muscle rides for urban drivers, their creations eschew expressways for traffic snarls and deliver energy efficiency that makes Toyota's Prius hybrid look like a Hummer.

These slow rides can't go far or fast, to be sure. But their proponents insist that's mostly a psychological barrier, given that city drivers do neither very often. Whereas internal-combustion engines perform worst in short-haul, stop-and-go driving, EVs excel at it. Indeed, today's plug-ins can accelerate off the line like gas-powered cars and stay with them in urban traffic, offering most of the same basic amenities. And they cost just a tenth of what the average car on the road does to operate. "These cars deliver what people are looking for in cities: mobility, ease of driving and low cost," says Chetan Maini, deputy chairman of Reva Electric Car Co., the world's leading electric carmaker, based in Bangalore, India. "They are not designed to go from Los Angeles to San Francisco."

But they go very well within either metropolis, or in Tokyo, London or Mumbai, for that matter. In Europe they're known as medium-speed vehicles; in North America, they're classified as neighborhood electric vehicles—a category of street-legal machines originally created in the 1990s to allow golf carts to operate within gated communities. The best of them now achieve top speeds of 64kph, have ranges up to 64km per battery charge and get the equivalent of 106km per liter of gas. Their biggest weakness—and proponents insist it's a red herring—is that EVs aren't subject to standard crash tests and lack modern safety features like crumple zones and airbags. Manufacturers argue that city rides shouldn't be held to the same standard as vehicles built for autobahns, and that with safety glass and seat belts, they are safe cars for the speeds at which they currently operate.

If you haven't heard of EVs yet, join the club. "This is not the mainstream automotive industry," says Ian Clifford, founder and CEO of the Toronto-based ZENN Motor Co. "The numbers we use to gauge success are very different from the ones General Motors would use." Yet in an era defined by $100-per-barrel oil and carbon-footprint-conscious consumers, those numbers are worth watching. EV makers will push their vehicles beyond select test markets in 2008. Reva, for example, has built about 2,500 vehicles in the four years since it began production, but by midyear will have expanded its annual capacity to 30,000 with a new facility in Bangalore. Likewise, two California-based start-ups that manufacture in China—Miles and a rival called ZAP (for "zero air pollution")—are both expanding fast and ZENN plans "a significant ramp-up" in 2008, says Clifford.

Each maker is eying a market that, though still unproved, could be vast. On the cost side, EVs are expected to get significantly cheaper once mass production ensues; industry leaders say the average price could fall from today's $15,000 or so to below $10,000, or roughly a third the price of the plug-in hybrids major automakers are forecast to launch after 2010. They will be able to go highway speeds and run forever because they will be plug-in hybrids, with internal combustion engines aboard that will take on electricity and use their gas engines when electricity runs low to generate more electricity. These cars will be hybrids, not battery-only EVs. At that discount, "projected sales for the [medium-speed vehicle] segment are something like 500,000 vehicles per year globally," says Danny Epp, general manager for Dynasty ElectricCar Corp. in Vancouver.