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 |  Mar 20 2012, 4:31 PM

Despite the fuel efficiency benefits of a hybrid vehicle, the average cost premium of purchasing a hybrid over a conventional internal combustion vehicle is still approximately $2,000.

In order to begin seeing the cost benefits of fuel frugality, an ownership period may be as long as 6 years before money saved at the tank can make the initial premium of the hybrid technology seem worth it. Because of the long payback period, hybrids seem less appealing, reflected by the small market share of hybrid vehicles in North America at a mere 2.2 percent.

However, research firm Pikes Research predicts that the price difference between EVs and gasoline-powered cars will gradually lessen as the cost of lithium-ion battery production is expected to drop by over 30 percent by the end of 2017.

The key component for the drop in Li-Ion battery costs is the continuous innovation in the field of Li-ion battery technology and the streamlining of manufacturing processes to make its construction more cost effective. What’s more, as the access to lithium becomes more common, the price of raw materials should fall as well. Basically, Pikes Research claims, a growing demand of electric and hybrid vehicles will become the catalyst for the future cost decline.

Research director John Gartner explains, “The market for Li-Ion batteries will be driven primarily by plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs), which require much larger battery packs than hybrids.” Gartner then adds, “Reducing the installed price of EV batteries to $523 per kilowatt hour in 2017 will be a critical step towards making PEVs cost-competitive with petroleum-powered vehicles.”

Studies from Pikes Research suggest that if electric and plug-in hybrid vehicles could really narrow the price gap, then the market for Li-Ion batteries will increase from $2 billion in 2011 to $14.6 billion by 2017. Approximately half of the demand is expected to come from Asia, 25 percent from the United States, and 21 percent from Europe.

[Source: Pikes Research]

 |  Aug 24 2010, 2:38 AM

Canadians are more likely to go electric when buying a new car compared to Americans, says research from a new study.

Conducted by Synovate, a global market research firm, the company polled 1,800 new car buyers in the U.S. and 800 new car buyers in Canada. The study dealt with current petroleum based power-trains (internal combustion, diesel, flex-fuel, natural gas) and electric power trains (hybrids, plug-in hybrids, battery and fuel cell).

In the study, Synovate asked respondents about what type of engine they would like in their future vehicle. They found that Americans had a stronger preference for internal combustion engines (61 percent) than Canadians (53 percent). When it came to a hybrid engine, the neighbors tied with 64 percent stating their preference.

But when it came to other electric technologies such as plug-in hybrids, Canadian respondents came out with a stronger preference (34 percent) than Americans (27 percent). The results were similar when it came to pure battery electric vehicles as well (29 percent Canadians versus 24 percent Americans).

According to Stephen Popiel, senior vice president of Synovate Motoresearch, “Canadians clearly want “greener”, more environmentally friendly vehicles. We seem to be more driven than Americans on reducing emissions while they are more concerned about fuel costs.” Reaffirming their green ways, Canadian respondents were more likely to be looking for ways to reduce their CO2 levels (28 percent) than American respondents (23 percent). The American respondents were more likely to be looking for ways to minimize fuel costs (64 percent Americans versus 58 percent Canadians).

On the subject of Flex Fuel, Canadian respondents did not see E85, the blend of 85 percent ethanol and 15 percent gasoline, as an option. The Canadians surveyed were much less familiar with E85 (16 percent familiarity in Canada versus 26 percent in the USA) and have a weaker preference for E85 (21 percent in Canada versus 31 percent in the US).