Friday, August 22, 2014

BMW i3 REx vs Chevy Volt: My Take

The Challenge

Last week I was contacted by High Gear Media Senior Editor, John Voelcker and asked if I had interest in doing a head to head comparison piece between my i3 REx and a Chevy Volt. Green Car Reports contributor David Noland (who happens to own a Volt and a Model S) wanted to pit the Volt against an i3 REx and asked John to reach out to me and find out if I was up for it.

I liked the idea of swapping cars and driving side by side for a few hours and that met David's needs as well. David wanted to do an efficiency test and measure the miles per kWh's used driving 15 to 20 miles in a city environment, and then do the same thing at highway speeds of 65 to 75mph. Going in, David expected the i3 to be more efficient in the city driving test, but the Volt to be more efficient on the highway test where weight plays a lesser role and aerodynamics are more important. The i3 is tall, has a large front area and is a bit boxy compared to the Volt. This creates a much higher CdA which will lower the i3's efficiency at high speeds. Having driven my i3 for a while now, I knew it would be more efficient in the city cycle, but I figured it would probably tie the Volt on the highway leg of the test. My i3's life time efficiency so far is 4.5 miles per kWh and I do at least 50% of my driving at highway speeds.
David averaged 4.1 miles per kWh over a 46 mile drive at highway speeds. This was driving about 15 miles in charge depleting mode and another 31 miles with the range extender running.  The display only shows an average speed of 56.7mph, but much of the trip was done at 70+ mph
David was also very interested to find out how the range extender performed. In my opinion, the i3's range extender is largely misunderstood. Even months after the launch, few people really understand how it works, what it can and cannot do. It has been called everything from a "limp mode" to an "emergency use only" option, and quite honestly BMW hasn't done itself any favors by not fully explaining how it works and how to use it properly. I promised David he could drive it as he wished, and even purposefully overwhelm the REx by driving fast enough to use more energy than the range extender could produce, should he desire to do so. At one point he even asked if I minded if he did just that, but due to the other traffic we couldn't really sustain a speed much over 70mph for long and we were not going up and long, steep inclines so the REx was able to put out enough power to maintain the SOC between about 4% and 6%. In short, we couldn't overwhelm it without driving in a an unsafe manner.
Getting ready to take off from Nauna's Bella Casa in Montclair

There aren't many long climbs in my area and I've driven with the range extender on quite a bit. I haven't found any condition where it isn't perfectly capable of allowing me to drive as long as I needed to, including hundreds of miles if I really wanted. However I know the REx has its limits, unlike the Volt. I have heard stories of people not being able to maintain highway speeds as the car drops to 45 mph suddenly. That's a problem that BMW needs to address. I think they need to make a better effort to communicate to the customers what the limits are, and I also believe the customer needs to be cognizant of the limits and keep an eye on the SOC under high speed driving up long inclines. It's not a do-all-under-any-condition vehicle. The range extender has limits but I definitely believe that for the vast majority of people it will do just about anything they need. Also, since the i3's electric range is double that of the Volt, the range extender will be used much less, so it's reasonable to understand why it is less robust.

People are surprised when they see the i3 next to other EVs. It is larger than I believe many people think it is.
On the Road
 
I felt very comfortable behind the wheel of the Volt as I've driven many of them and have always liked the driving experience that they offer. However, this was the first time I've driven a Volt since getting my i3 REx three months and about 6,500 miles ago. The two cars definitely feel very different. The much heavier Volt absorbs road irregularities better and is quieter at high speeds, where the boxy i3 has noticeable wind noise. The i3 is much quicker, especially at higher speeds and has better braking and handling. The i3's steering is more direct and sensitive and the Volt's brakes seemed a little spongy or squishy compared to what I'm used to in the i3. The i3 is clearly more of a performance car, while the Volt offers a more supple, softer ride. The regenerative braking on the i3 is much stronger than the Volt's, even in Sport mode and low driving gear. I'm sure I would adjust to it if I had a Volt for awhile, but I just couldn't get myself to stop for traffic lights without needing to depress the friction brake pedal every time. I almost never use the friction brake pedal on my i3 unless it's an emergency situation where I need to slow down unexpectedly. I really love this on the i3, and haven't found any other EV to have a regen system that matches it. It's definitely one thing that BMW got right. I know the Volt blends regen with friction braking so I suspect most of the time I depressed the brake pedal I wasn't even using the friction brakes, but I've really grown fond of the one-pedal driving of my i3 that anything else now seems sub-standard.
The interior of the Volt
The interior of the i3









I found both cars comparable in seating comfort and room, with the Volt having a larger cargo area. Because the e-drive motor and range extender are under the deck behind the rear seats, the i3's cargo deck is higher, which cuts down on the cargo space, but it also doesn't have a tailgate lip so you can slide objects in and out without having to pick them up over the lip to remove them as is the case with the Volt, which my bad back appreciates. Personally I like the uncluttered, modern interior look of the i3 better, and the large center display probably is the nicest I've seen in any car besides the Model S. However the exterior styling of the i3 is definitely unconventional and I'm sure many people will say they like the look of the Volt better, but styling is subjective so I'm not really going to get too caught up appearance here. One thing I really do like in my i3 is how the absence of a center transmission tunnel (battery tunnel on the Volt) provides a much more open, spacious feel in the cockpit. In fact, this makes it quite easy to slide across from the drivers seat and exit from the passengers door if you want to.  
The Volt has a larger cargo capacity, but with the rear seats folded flat, the i3's cargo space is definitely adequate for my needs.
Efficiency

David really wanted to focus on the efficiency of the cars so we did roughly 15 miles of city driving, followed by 15 miles of highway driving at 60 -70 mph. There were a few occasions we got up to 75 or so to pass other vehicles but for the most part we drove in the middle lane and averaged a little under 70mph. In the city cycle the i3 averaged a 5 miles per kWh used compared to the Volts 4.5. The Volt did better than I expected in this part of the test though, which I am happy to report. On the highway test the i3 delivered  4 miles per kWh used and the Volt averaged 3.5 mi/kWh. David and I were both surprised that the i3 actually had a larger advantage on highway driving than it did in city driving, but was 14% on the highway. I suspect if we drove faster, and averaged over 70 mph, the Volt would have caught the i3 in efficiency. The test also isn't perfectly controlled, since David and I aren't the exact same drivers. However, we are both very experienced electric vehicle drivers, and understand perfectly well how to maximize efficiency with the use of regenerative braking and limiting jack-rabbit style take offs. We drove with the climate controls set to 72 degrees and the windows closed.

During the city driving test. I jumped out of the Volt at a red light to grab this picture.
Conclusions

Having had quite a bit of previous experience driving Volts, there were really no surprises for me. I have always liked the Volt, and nothing from this experience has changed that. It's a very capable extended range electric car that offers a good ride, decent performance and nice styling. It is a better choice for long range driving (over 200 miles) and definitely if you live in a mountainous area. I can't even count how many people I've recommended the Volt to; and many have stopped back to my restaurant weeks or months later to show me that they took my advice. With a starting price of $34,999 it's a really a great deal. The i3 REx on the other hand starts at $46,125 which is $11,000 more. Yes, you do get a more nicely optioned vehicle but it's very hard to ignore the $11,000 difference. If price is a big consideration then it's hard not to pocket the eleven grand and take home a Volt.

However buying a car isn't always a rational decision, and there are indeed emotions involved. If that weren't the case we'd all be driving $15,000 Honda Fits. There are a lot of reasons why the i3 REx is a better EV for me than the Volt. First off, I drive about 33,000 per year, and the 38 mile AER of the Volt would mean I'd be driving on gas about as much as I drove on electric. The i3 REx will allow me to drive on electric over 90% of the time. For me to increase that 100% I'd need to jump up to Model S-type range because the times I have needed the REx were usually 150 to 200 driving mile days and there are no other current production electric vehicles capable of doing that without using a robust DCQC network which doesn't yet exist in the Northast. Another consideration is the 3.3kW onboard charger that the Volt has. I'd find it very hard to buy any EV that was limited to 3.3kW charging. My i3 can actually charge faster from zero to full an a level 2 EVSE than a Volt can, yet it has twice the electric range. GM absolutely needs to upgrade the onboard charger to a minimum of 6.6kW for the next generation Volt in my opinion.

I've read many comments on various online forums regarding the size of the i3's gas tank and I can say I categorically disagree with the notion that the car needs a larger gas tank. In fact, I'd be fine with a smaller one. If you think you need a bigger gas tank on the i3, then what you really need is a Volt because you're buying it for a use that it's not really intended for. The i3 REx is fine for driving in range extender mode for short distances, and I think it's really a great car for trips up to 150 miles or so, but if you really need to frequently drive more than that, it just may not be the best fit. If you need to go further once a month or so, then sure that shouldn't be a problem as long as you don't mind the 2-3 minute stop to refill the tiny tank, but frequent long distance driving just isn't the car's best use.

I also put a big emphasis on the driving experience and the i3 is really a blast to drive. The Volt is fun in its own right, and it is certainly no slouch by any means, but the i3 is noticeably faster and has a much more direct steering feel. I also love the fact that the i3 is all carbon fiber reinforced plastic and aluminum, the open cockpit and simple dashboard with the large center display. It was indeed the better choice for me, but honestly, I would be very happy driving a Volt also, especially if I drove less than the 90 miles a day that I do now. I don't think you can lose with either of these extended range EVs. Just pick the one that fits your budget, needs and desires and you'll be happy with whichever you choose.

You can read David's thoughts on his Green Car Reports article here.

Wednesday, August 13, 2014

Guest Post: Efficiency or Range? You Can’t Have Both.

The i3 is the most efficient production car available today

Every now and then I have a reader send me an article they wrote and ask if I'd like to post it here. Usually it's not exactly what I'm looking for and politely explain why I won't be posting it and thank them for sending it nonetheless.  Occasionally I'll get something interesting though, like the post below which was sent to me by Robert Kasper. I think it's particularly timely since just last week I posted the Tesla/BMW comparison piece and I think this is an interesting follow up to it.  I hope you enjoy:                    

  Efficiency or Range?  You Can’t Have Both.

…But Advanced Technology Can Help.

By Rob Kasper

In the world of electric vehicles, whether Battery Electric Vehicles (BEVs) or Plug-in Hybrid Electric Vehicles (PHEVs), there is a clear trade off between range and efficiency.  For a given technology, efficiency suffers as range increases due to the weight of not only additional battery capacity, but the increased structure and volume to haul that capacity around.  Now that there are a significant number of plug-in vehicles being manufactured, and a recognized standard to test them, we can identify trends.  Consider Table 1 and Figure 1, a plot of efficiency (as measured in EPA MPGe) vs. range in miles for 2014 plug-in electric vehicles measured by the EPA.  They are grouped into Battery Electric Vehicles (BEVs) and Plug-in Hybrid Electric Vehicles, and further identified as either conventional or advanced technology design and construction.  Conventional technology is generally characterized by a manufacturer’s use of an existing gasoline powered platform modified for battery electric drive, steel frame construction and cladding, and standard battery technology.  Advanced technology is generally characterized by a clean sheet, purpose built EV design, extensive use of aluminum or aluminum plus Carbon Fiber Reinforced Plastic (CFRP) for weight savings, higher energy density lithium ion battery packs, with the bonus of performance equivalent to or exceeding the best of conventional technology plug-in vehicles.

Figure 1: Efficiency vs. Range

Table 1: EPA Electric Range and MPGe

Beyond the obvious observation that the price of greater range is lower efficiency within a given technology, it is important to note the significance of advancing technology.  The ground-up EV design, significantly lighter weight construction, and advanced battery technology of the BMW i3 and Tesla Model S push the blue trend line significantly up and to the right of conventional BEVs’ green trend line.  As significant is the single data point (in purple) representing the only advanced technology PHEV currently available – The BMW i3 REx.  Not only is it capable of greater efficiency and far more range than any conventional PHEV (the red trend line), it is more efficient than all but two conventional BEVs, with only slightly less range than all but the most inefficient conventional BEVs.

It is this outlier of a data point, the BMW i3 REx that might best help illustrate why a smart means of increasing the range of an EV may not necessarily be to add more battery capacity.   Battery energy is clean and well suited for powering vehicles for relatively short-range transportation but due to its weight and lengthy charge times, inefficient and inconvenient for long distances.   On the other hand, the benefits of energy density and convenience make gasoline/diesel energy better suited for longer range transportation with the trade-off being greater well to wheel emissions in many parts of the world.  In the case of the BMW i3 REx, each mile of range requires either 0.15 pounds of gasoline, or 5.7 pounds of battery capacity.  At 37 times the mass specific energy density of battery power, very little gasoline is required to extend range for a given tank size, and that tank can be replenished in minutes nearly anywhere in the well developed fossil fuel infrastructure that currently exists worldwide.  This capability requires a 265 pound increase in the weight3 of the vehicle for the REx engine and associated systems, which imposes a 6% decrease in efficiency, but once set, that efficiency does not appreciably decrease as more energy in the form of gasoline is added to increase range.  Increasing battery capacity cannot increase range as efficiently, as not only must the weight of the battery increase by 37 times the weight of gasoline per mile in the first increment, but by the weight of increased structure and volume, as well as even greater battery capacity to offset the reduction in efficiency resulting from the weight increase.  There comes a point where the sacrifice in efficiency may no longer be worth the additional range to be gained.
See figure 2:

Figure 2: EV Energy Storage (and Generation) Weight vs Range for Advanced Technology EVs



1- EPA testing protocol does not account for approximately 4 miles of range remaining after REx fuel exhaustion when publishing a 72 mile battery powered electric range before REx activation, but does account for it in the total range calculation of 150 miles:  72 electric miles + 1.9 gal x 39 mpg + 4 electric miles = 150 EPA range (76 electric + 74 gasoline).  76 miles of range is also the result of dividing the EPA measured total i3 wall to wheel consumption of 22.0 kWh by the i3 REx EPA measured consumption rate of 0.288 kWh/mile.  This value is further corroborated by the CARB BEVx designation awarded to the i3 REx which requires the electric range not only be at least 75 miles, but that it must exceed the gasoline range, neither of which would be possible without accounting for the ~4 miles of range remaining after REx fuel exhaustion.

2- The EPA’s 95 MPGe rating of the Toyota Prius Plug-In Hybrid includes 0.2 gallons of gasoline operation plus 29 kWh of electric operation per 100 miles.  Subtracting the 10 mile of gasoline operation contribution to the total (0.2 gal X 50 mpg) yields 29 kWh per 90 miles, or 32.2 kWh per 100 miles, which results in 105 MPGe for electric only operation. (MPGe = 33,705 divided by watt hours per mile.)

3- While EPA rated at 87 miles of range in its base form, purchasers of the Mercedes-Benz B-Class can choose to pay an additional $600 for the Range Package, which makes an additional 17 miles of range available.  There is no difference in total battery capacity between the two configurations, only the percentage of SOC made available to the driver.

4- The 8 BMW battery pack modules weigh 55 lbs. each, for a total of 440 lbs.  Reference page 17 of the BMW i3 Service Managers Workshop Participant Guide at http://darrenortiz.com/website_pdfs/BMWi3PG.pdf.

5- 265 lbs for the REx engine and all associated equipment is the difference in weight between the i3 BEV and i3 REx as published on BMW’s spec pages:  http://www.bmwusa.com/Standard/Content/Vehicles/2014/i3/BMWi3/Features_and_Specs/BMWi3Specifications.aspx
http://www.bmwusa.com/Standard/Content/Vehicles/2014/i3/BMWi3RangeExtender/Features_and_Specs/BMWi3RangeExtenderSpecifications.aspx.  Adding the 440 lb. battery weight makes the total energy production and storage weight at 76 mile of range 705 lbs.  This increases by 11.4 lbs. of gasoline for every 74 miles driven beyond 76.

6- Widely quoted in other sources, Car and Driver claims the Telsa Model S 85 kWh battery pack weighs 1323 lbs: http://www.caranddriver.com/reviews/2013-tesla-model-s-test-review.  This is exactly 600 kg, making it appear to be an estimate, but it is the only number we have to work with, as Tesla does not publish the spec.

7- Weight of the 60 kWh Tesla Model S battery pack is estimated from the 85 kWh figure to be 60/85 X 1323 lbs. = 934 lbs.

Monday, August 11, 2014

Born Electric Guest Blogger: Meet Christopher from Massachusetts

Christopher on pick-up day! Born Electric 8/6/14
An EV Awakening

Hi, my name is Christopher and I was born electric on August 6, 2014.

In retrospect, ending up behind the wheel of BMW’s new electric i3 feels like it was inevitable.  If you let it, life has a funny way of getting you where you belong.  My path into an i3 took about seven years, but with the benefit of hindsight, it feels like destiny.

The car I took to college in the late 80s was an Inka orange 1972 BMW 2002. That was followed by a jade green one, which I still vividly remember driving across the country in the summer of 1989.  I have been a fan of the BMW brand since those days and have owned five of them of various types in a continuous chain over the last 30 years.  For me the design, the handling, the safety, the quality, the purity of focus, the racing heritage - all of these things made BMW a brand I kept coming back to.  I have also always been drawn to the geeky technical side of things in life, so the cutting edge in technology, including as applied to automotive design, has been an enduring interest of mine. 

But as I have grown older I have become more and more concerned with trying to protect some semblance of our environment for my children’s generation.  And, probably in part because of my kids, as I have matured, I have become a more conservative and less aggressive driving, realizing that while pushing hard does not really shorten your trip, the stress and increased risk of aggressive is likely to shorten your lifespan.  Work, urban living, extreme road congestion, and family responsibility all conspired to make storming around in a sporty car less of a priority.  Given my day to day reality, a thirsty high performance car is simply the wrong tool for the job.

So not surprisingly, over time, the BMW brand’s focus on luxury, power, speed and performance slowly drifted out of sync with my mental frame of reference.  I still loved and admired the cars, but the idea began to gnaw at me that burning gas just for the joy of it was an irresponsible thing to do, especially day in and day out while commuting. At least for me, there had to be a better way.

As my daily driver, a beloved BMW 3 Series wagon, tuned somewhat severely by Dinan Engineering for more performance and handling, hit about ten years old in around 2010, I began to feel the first stirrings of a need to replace it with something better suited for the job at hand. Something more reliable, more comfortable, more efficient, more sustainable.  I began, as a sideline, to leisurely consider the options available in the market at that time. 

My 3 Series Dinan-tuned wagon

Some of the BMW diesels were interesting, but they were a bit too expensive - the pay-off was way too long given the high price of diesel in my region of the US.  The early BMW hybrids were not serious, or credible, efforts.  The small nimble 1 Series cars were sort of appealing, but there was no reason to downgrade to one of these from the beloved Dinan wagon.  So I began to look at other options. When we converted our home to solar my search began to look more seriously at the growing market for non-BMW hybrids and electrics.  I had always followed the hybrid and EV technology, but the cars suddenly seemed like plausible alternatives for the first time. 

So after a bit of research, we took the plunge and replaced my wife’s BMW 5 Series Wagon with a Prius V wagon.  With its arrival, the surprising pleasures of driving as efficiently as possible first became apparent to me.  The car was a bit of an eye opener. Setting the cruise for 65 and just chilling out in the right lane was a whole new experience for me.  Before long, between the hybrid joining the motor pool and the solar house generating a surplus of electricity each year, I had been bitten by the EV bug badly.

But there was still nothing I was tempted to bite on for myself.  I really didn’t like the way the Prius felt and drove and handled (it might crash test well, but in reality, to someone used to the solidness of a BMW, the Prius feels like a pretty flimsy car and drives like the transportation appliance it is).  Given the demands of my work and lifestyle I didn’t feel comfortable with a 60-70 mile range EV - I needed to be able to jump up and drive 125-250 miles at a clip if necessary, and couldn’t imagine spending good money replacing a car that could easily do that with a more expensive one that couldn’t.  And I didn’t want a big sledge-hammer of a car like the 16 foot long, 4700 lb, Tesla.  They are undeniably excellent cars in many ways, but the engineering approach, the size, the cost, and the short track record of the manufacturer completely ruled them out as an option for me personally.  So I was kind of stalled. (pun acknowledged)

The concept i3 is revealed
Not surprisingly, BMW’s announcement of the i Division in 2011 really caught my attention. The first BMW i car was still years away, but I began following the project closely and learning everything I could.  At each step of the way, I felt BMW made the right choices.  The emphasis on total sustainability in design and manufacturing.  The emphasis on lightness as a way to make the car more efficient and get to longer range (a sharp contrast to the just-add-more-batteries school of design).  The willingness to do radical things and use radical materials to advance the state of the art.  The focus on trying to keep the price reasonable.  The boxy, geek-chic utility of the package.  I began to feel certain that this was going to be my next car.

As the project progressed, I continued to read everything I could find to keep up to date.  The leaks and speculation grew increasingly enticing.  I was biting my nails that BMW would not make a design choice that suddenly disqualified the car for my needs.  My main concerns, even in those days of exaggerated range estimates, was whether it would go far enough on a charge and whether it would be prohibitively expensive.  If the rumors of reasonable pricing “between the 3 and 5 series” were comforting, the announcement of the Rex was a total revelation.  Once it became clear that this car was going to be available with a very smartly-designed range extender, it became inevitable that it was going to be my next car.



Tom and Dr Julian Weber, BMW's Head of Innovation Projects E-Mobility at the i3 launch in July 2013 in New York City
With great excitement, I watch the world-wide unveiling of the i3 on my laptop at work one morning in July 2013 . And I followed the European launch of the first customer cars that Fall very closely.  As the US release drew closer, and final US pricing was announced, I began to make my plans.  I joined Tom’s excellent i3 Facebook group and began to learn about the real-life issues reported by cars in the field.


Oddly, my first opportunity to put down a deposit and order a car came before the first test drive cars were available in my area.  But the deposit was refundable, and demand was projected to be through the roof, so I put down a deposit in early February 2014.  The Launch Edition requirements were a bit of a headache, but my first few test-drives confirmed all my instincts were correct.  It was clear from a couple test drives that this was a very special car.

As manufacturing issues stacked up, I tracked the Leipzig production weeks and watched with despair as my build date slipped repeatedly from mid-March into late April. However finally in late April the build began. As a projected single week in the factory turned into an inexplicable six week delay in the Leipzig plant, I vicariously enjoyed the tales of the first cars being delivered in early May to the Electronauts who had tested the i3 drivetrain in the Active-E program.

  

MY ClipperCreek EVSE
Widespread reports of initial quality hiccups, combined with mounting delays, really tested my patience (and at times probably the limits of some of my online i3 friendships.)  But the joy most people took in the car combined with the knowledge that BMW would stand behind their multi-billion dollar investment in this project and the certainty that a large silent majority was not having any issues, was enough to keep my tattered faith intact. Having Tom and some of the other experienced Electronauts there to answer questions and offer advice was indeed extraordinarily helpful.





Tracking the Don Juan
Researching and installing a charger kept me somewhat busy as May and June dragged on and my shipping delays mounted. Eventually, my car made it to the port of departure in Bremerhaven in mid June and, after another wait, finally got on a boat in early July. Tracking the boat was painful given how close, and yet so far, my car was.  But eventually I caught a glimpse of my ship on a webcam in Halifax Nova Scotia, and it suddenly started to feel very real for the first time. Arrival at the vehicle processing center in New York was like entering a black hole - the car sat in processing for three weeks before being released to trucking, and that was only after placing a couple calls to get it prioritized.  And, naturally, the trucking took forever.  Long enough, in fact, that the car arrived about two hours too late to take on a multi-state loop to visit family that had been planned to take advantage of the car’s arrival. 




So off we went in the Prius, and in a great irony, the just-arrived car sat for several days before I could pick it up.  But eventually I made it to the dealer, and after 30 years of BMW enthusiasm, 7 years of evolving awareness, three years of studiously following the i3 project, 6 months of post-deposit waiting, the perfect car for me arrived, and I was born electric on August 6, 2014. 




Has the car met my initial expectations?  Without a doubt.  The design and build quality is outstanding, and the car is as comfortable as any I have driven.  But the way it performs has been the biggest surprise.  This car is just such an amazing juxtaposition of serenity and fury.  Driven hard, it leaps off the line with instantaneous torque - you can drive a week and never meet a car that can beat it from a green light down a city block Out in the country, when accelerating out of tight corners, it has enough power to break the rear wheels loose (and trigger the traction control) even on dry roads.  But driven more gently it is supremely smooth and silent and tranquil.  The ride is firm as to be expected of a teutonic car, but the drivetrain is so quiet, and the cabin so tight and noise-free, that the car is just amazingly relaxing to travel in.  Further stress reduction is afforded by the optional automatic cruise control, which allows you to set your maximum speed and forget it from there forward.  The car will track the traffic in front of it and maintain a safe distance regardless of traffic speed (even down to stop and go speeds) and then silently leap forward when the road opens up in front of it.  A dream for urban and suburban commuting.  This is a car that will play when you want to play, and lay down the miles without tiring you when you just need to get efficiently from point A to point B.  To paraphrase E.B. White’s famous words about Wilber: “That’s one swell [automobile].”


Christopher Mirabile is an early stage investor in Boston MA, USA.  He is the co-Managing Director of Launchpad Venture Group and the co-Founder of angel portfolio management site www.Seraf-Investor.com. He blogs about technology, investing and entrepreneurship at www.scratchpaperblog.com. and Tweets under the name of @cmirabile

Thursday, August 7, 2014

BMW & Tesla Taking Different Approaches But Will Ultimately Face Off


Horatiu Boeriu of BMWBLOG recently did a piece titled "BMW vs. Tesla - Which Company Is A Bigger Innovator?" in which he mentions that while both companies are competing in the premium automobile segment and are committed to electric mobility, they are taking different paths to achieve success.

I'm not going to try to analyze who has it right or who is a bigger innovator, but it's clear that both companies have chosen to focus on different aspects of their respective vehicles. With Tesla, it's all about the batteries. Unlike every other automobile manufacturer, BMW included, Tesla's approach isn't for their electric cars to complement their lineup of gasoline and diesel offerings since they don't have any. Instead, it is to render gasoline vehicles from their competitors obsolete. In order to do so, their cars have to be at least as good or better than most features of competing gas cars; and that includes range, performance and utility. BMW on the other hand doesn't need to necessarily worry about making everything better. They can focus on specific needs of certain customers and make a vehicle that is better than any other at a specific set of tasks, without cannibalizing sales of other vehicles in their lineup. If you accept that premise, it's not difficult to understand why we have the Model S and the BMW i3.
Tesla knew they had to knock it out of the park with their first high volume vehicle offering. They knew they had to offer a car that could stand its ground against all of the top luxury sedans while offering a range long enough to allow for road trips enabled by the Supercharger network. Even though that was an enormous task, and one that few automotive analysts really believed they would pull off, they did just that and the Model S is a smashing success. No disrespect to the sexy styling or the fabulous performance of Model S, but the heart and soul of what the car is can be attributed to the enormous battery pack it uses, filled with industry leading, high energy-density batteries. Tesla is all about the batteries. Even though the Model S uses batteries that have a higher energy density than any other EV manufacturer, they still aren't satisfied. They aren't waiting for the market to bring them better, cheaper cells for their future cars. Instead they are in the process of building what will be the first of many Gigafactories, which will be the largest lithium ion battery manufacturing plants in the world. This will drive down costs, guarantee that they have the supply that they need, and allow them to constantly upgrade to better cells without needing to wait for battery manufacturers to retool production facilities to produce them. The key to Tesla's success is having the best batteries available, and to manufacture them for less than what their competitors are paying for comparable cells. It's the only way to offer large battery, long range electric vehicles and be able to price them competitively.  It's Tesla's edge, and perhaps their only hope to compete and actually beat the large, established automakers.


BMW's not in the battery business and is unlikely to follow Tesla's path as such. As mentioned above, since they didn't need the i3 to do everything better than any other gas offering as the Model S had to, BMW could focus on a specific set of goals with their first electric vehicle. The i3's code name was the Megacity Vehicle and the goal was to develop a car that would be the perfect electric vehicle for the increasing populations within the megacities of the world. They also wanted this car to represent a departure from traditional manufacturing processes with an emphasis on sustainability.  They set out to make the most efficient production car available today and they achieved that goal. The extensive use of carbon fiber reinforced plastic and aluminum allowed BMW to shave 400 to 500 lbs off the car which played a primary role in its efficiency.

Will BMW leave Tesla in their rear view camera? That doesn't look very likely at present.
I believe the i3 is as much of a learning experience for BMW as it is their first electric vehicle. Every step of the manufacturing process was rethought and redesigned for the i3. In fact, the i3 uses 70% less water and 50% less electricity to manufacture than a comparable-sized conventional BMW would. In addition, the Leipzig manufacturing plant where the i3 is made is now completely powered by wind-generated energy. So as much as the i3 is an important vehicle to BMW today, the lessons learned bringing it to market today will pay dividends when future i cars are made. The i3 indeed paved the way for the rumored i5 and other models from the i brand. You can expect larger battery, longer range electric cars from BMW i in the not-so-distant future. I suspect by the time Tesla releases the Model III, BMW will have an electric offering which is comparable size, range and price, and that will be good news for the consumer.
My i3 had a visit by its big brother. I'm one of the few lucky people outside of some select journalists who have driven an i8 on public roads. The future is definitely looking electric!
BMW knows that by focusing on a specific set of needs (efficiency, performance, sustainability) rather than long range, the i3 isn't as well suited for road trips as the Model S. They knew that every kWh of battery that they added would sacrifice efficiency and increase the cost of the car. I still maintain that if BMW had indeed used a slightly larger battery and delivered a true 100-mile EV, it would have been much better received, but that's a pointless argument now. While it does have a shorter range, the i3 does have features that are not even available in the Model S, such as adaptive cruise control, collision avoidance with automatic braking and self parking. As you would expect from BMW, the i3 is an extremely fun car to drive, and a great addition to the current lineup of EV offerings. I think it fits in well situated directly between the Model S and the LEAF in price.
My i3 at home
BMW did realize some customers would want a longer range so they offered the range extender as an option. It's really a great option to have and while I personally like how well it works, it isn't for everybody. Many have argued that the REx ruins the purity of an EV, and while I can agree with that, I can't agree that it shouldn't be an option. If such a feature allows more people to buy a plug in car, then I think that's great. I see the range extender as a temporary fix until batteries get better, lighter and cheaper, but a necessary evil at present. Obviously BMW agrees with that and unlike Tesla, they will wait for the market to bring them improved battery tech while Tesla has decided to bring improved battery tech to the market. Different approaches, different cars and I don't think either is right or wrong. They are both working on bringing cutting edge technology to market today with the promise of even better things to come. BMW and Tesla aren't going head to head in the EV space right now, but they certainly will. Competition is good because it forces innovation. Maybe Horatiu was onto something after all.

One last point: If Nissan does deliver on the rumors that the next generation, 2016 LEAF will have a 150+ mile range, and they can deliver it for a reasonable price, then both Tesla and BMW should be concerned, very concerned...

BMW and Tesla going nose to nose in the premium electric vehicle market is inevitable.