Can Recycling/Leasing Car Batteries Finally Be Game-Changing For EVs?
Above: Tesla S model battery
There you go, wind in your hair, hugging countryside turns with your new electric vehicle you absolutely love ever since you drove it off the showroom floor. Fast-forward a few years. You still love to drive your electric car but the car doesn’t quite pack the punch around those same countryside turns that it used to. What if you leased the battery when you either leased or purchased the actual car? You could now swap out your old battery system for a new one when the lease was up. Carlos Ghosn, chief executive for Nissan and Renault has talked about leasing batteries in the past. In fact, Renault has implemented battery leases in Europe. Could this idea make its way stateside?
Leasing batteries could do wonders for cash-strapped electric vehicle (EV) consumers since the batteries are the largest single cost of the cars. Would you be happy if leasing an electric battery pack could knock $12,000 from the purchase price (using $100 per month for 10 years of driving use)? That should certainly make the electric car more affordable Day 1 “on paper”. However, you still have to pay the nearly $13,000 over time.
Above: Recyclable Copper Cobalt product/filter cake from EV batteries
For leasing batteries to become mainstream, the auto industry, leasing companies and battery recharging/swapping services like Better Place, need to further economically validate the notion electric battery components can successfully be recycled. I wasn’t always convinced of the Better Place model since Think City went belly up on a EV rollout and leasing strategy. I was also concerned about Better Place constantly having to stock the shelves with the latest battery technology, their ability to build more alliances with automakers and getting the financial help needed to build infrastructure in order to make fueling up your EV as easy as you do now in fossil fuel vehicles. I have been slowly converting though. I feel Think City, which has been bankrupt multiple times, is more indicative of idiosyncratic risk rather than systematic risk. I’m comforted to know that even in a weak economic climate, Better Place has raised north of $750mln in funding since 2007 and they have been growing their presence in Europe. Making electric auto batteries a lease/subscription business similar to your cell phone carrier could turn heads of naysayers but think about the benefits: Faster charging, latest battery technology and higher resale value, a huge issue with EVs.Continued on the next page