Italy lagging with low charge in electric vehicles

JON VAN HOUSEN and MARIELLA RADAELLI

Last year Fiat-Chrysler CEO Sergio Marchionne famously termed the notion of an electric Ferrari “obscene”. His statement might embody Italian grandeur and love for the roar and power of a muscular high-performance engine, but it also helps explain why Italy trails most European countries in electric car sales.

And why most of Europe itself lags other major car-producing regions in alternative energy vehicles.

Just 2,821 electric vehicles were sold in Italy last year — a tiny market share of 0.16 percent of the new cars sold in the country.
Italian electric cars
Though auto experts say the Fiat 500e is faster than its conventionally powered sibling, sales have been sluggish.

Fiat-Chrysler, which owns Ferrari, does make an electric model, the Fiat 500e, but Marchionne estimates that the company loses $20,000 on each one.

Perhaps beetling around in an electric minicar doesn’t fit the bella figura – beautiful appearance – needed to lure Italian car buyers. It just doesn’t have the status.

Yet some in Italy are moving along the electric path. A company based in Imola has been producing electric cars since 2009. Tazzari Group now manufactures four models made with aluminum fusion technology using both automotive and motorcycle components.

Ferrari might still be in the pit stop on electrics, but another iconic brand has moved forward. Vespa, the classic Italian motorbike made by Piaggio, has unveiled a model scheduled to hit the market next spring. The battery-powered Vespa Elettrica is accompanied by a hybrid model, the Elettrica X, which combines a gas-powered generator for extra range. Both models will be made at Piaggio’s headquarters in Pontedera.

While that might be interesting to students of Italian design icons, in numbers Italy has very little presence in electric vehicles. Of the top 15 European countries by sales from January to September this year, Italy ranked 11th, leading only much smaller Portugal, Iceland and Finland and lesser developed Ukraine.

In the global context, many of the same trends are true for Europe as a whole.

But the continent that gave birth to the gasoline and diesel engine now wants to power up electric vehicle production as the European Union moves toward incentives, carmakers formulate plans to develop zero-emission models and an electric grid builds an “e-highway” from Norway to Italy.

The developments would change not only the way people travel but also strategic relationships and economies as oil dependence and its import costs decline.

The European Commission, the EU’s regulatory arm, has just proposed stringent caps on vehicle emissions of carbon dioxide beginning in 2025 as part of the battle against global warming. The plan would also offer incentives for carmakers to shift to electric vehicle production.

German alternative energy company EON has unveiled plans to build a network of 180 “ultra-fast” charging stations for electric vehicles in seven countries connecting Norway to Italy, an EU flagship project that has received €10 million in startup funding from the European Commission.

EU Climate Commissioner Miguel Arias Cañete says such plans strike “the right balance — ambitious, enforceable and cost-effective”.

“Europe is currently not on the right track. Electric cars account for less than 1 percent of new sales,” he says, adding there are now only six brands making electric vehicles available to consumers.

“There is a huge gap between Europe, which invented the car, and developing countries,” says Cañete, noting that China already makes 400 types of electric vehicles.

EU Transport Commissioner Violeta Bulc says the proposals are at first focused on infrastructure.

“Charging electric cars on EU motorways must be as easy as filling up at petrol stations so we are making this a reality. There is a clear action plan to speed up the deployment of charging points,” she said.

The commission proposal, which needs the approval of EU governments and the European Parliament, will include €800 million for the development of infrastructure to charge electric cars, says Cañete.

And while burning less carbon-based fuel would be good for the environment it would also benefit Europe’s balance of payments and geopolitical security. Fully 30 percent of oil imported by EU countries in 2015 came from Russia, a country embroiled in charges it has an ongoing effort to destabilize the West. Just 8 percent came from Saudi Arabia and 7 percent from Iraq.

Then there is the cost, some €215 billion in 2015 at a time of low oil prices, or €425 for every man, woman and child in the EU. The EU currently uses about 13 percent of oil shipped globally.

If electric vehicles were to make up one-third of the global car market by 2040, it would shave 9 million barrels a day from demand worldwide, a volume equivalent to 90 percent of Saudi Arabia’s daily output.

Yet analysts say even with a greater market share in the future, electric vehicles on the road would still be greatly outnumbered by conventionally powered cars and trucks. Projections say there will be about 2 billion vehicles in use globally in 2025, about 500 million more than today, the majority of them powered by oil – a net number still greater than today.

As one of the four great car producing regions in the world, Europe lags not only China in development of electric cars but also the U.S and Japan. Its storied auto brands are just leaving the start line with mass production of plug-ins, as shown by Volkswagen, the world’s biggest carmaker.

It will start production on an electric brand called I.D. in 2019 with the first vehicle, a Golf-sized hatchback, scheduled to hit the market in 2020. Battery-powered models will also be offered for its sister brands Audi, Seat and Skoda for a production volume of about 100,000 vehicles that year, VW said in a statement. BMW, Fiat, Mercedes-Benz and Renault also make electric cars, but with such limited variety, market penetration has been poor.

VW said it projects sales of between 2 and 3 million electric cars in 2025, or up to 25 percent of its sales for the year. Mercedes is estimating 15 to 25 percent of sales, the same ratios targeted by BMW. Even Porsche says 50 percent of sales will be electrics by 2023.

Although those goals are many years away, some smaller European countries have embraced electric cars. With 29 percent of new car sales, Norway has the highest ratio in the world at 135,000 plug-ins, or 5 percent, of all vehicles on the road.

As desirable as they appear in theory, electric cars still face a range of technical and practical hurdles. Short battery life and travel range, as well as long charging times and high prices, make them far less attractive to many conventional consumers.

Buyers might not be lining up, but carmakers and consumers alike could have little choice, especially in highly regulated Europe.

Auto companies will have to step up production of electric cars as regulators impose ever-tougher emissions targets, possible outright bans on conventional combustion engines or quotas on the share of electric cars in a company’s overall fleet.

Like it or not, the day could come when you have to plug in or drop out.

A version of this story appeared in the Khaleej Times of Dubai.