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Better Place and Renault Delivering 115,000 Electric Cars in 2011

Renault Fluence EV

On October 1, 2011, the largest electric car rollout in history—complete with charging stations and battery exchanges—will take place in the Middle East and Europe. Better Place and Renault, who have a long working relationship, will make 115,000 automobiles available to the public in Denmark and Israel. According to a presentation given to Deutsche Bank, the release will also include a joint partnership with General Electric

Bringing automobiles to market has always been the weak point for all vendors of electric cars. Better Place announced earlier this month that their deal with Renault for the Israeli and Danish markets was finalized. Under the conditions of the agreement, Better Place has agreed to purchase 115,000 Renault Fluence Z.E. Electric sedans. The automobiles are manufactured in Bursa, Turkey and 660 preproduction units have already been unveiled. A separate electric compact model may also be placed on the Israeli and Danish markets. While traveling at or below the speed limit, the Renault Fluence is able to travel for approximately 110 miles before needing a charge.

This will be a challenge for Better Place. While the capabilities of the Renault Fluence are far and away better than those of earlier electric cars, the industry is still in its infancy. Skeptics will note that going over the speed limit and simply being stuck in traffic both put a major dent in battery life. Additional car batteries are unwieldy and impractical to keep in automobiles, especially in Denmark and Israel where car models have traditionally been on the small side.

Another challenge for Better Place will be the performance of the Renault Fluence. The automobile takes quite some time to recharge if one of Better Place's battery-exchange centers are not easily available: recharging a car using a home electric supply takes between six and eight hours, while the recharging centers Agassi has unveiled still require a solid half-hour to recharge a car to maximum capacity.

Shai Agassi

But this plan is no less audacious than any of the others dreamt up by Shai Agassi. The founder of the Israeli-American company Better Place is already unveiling a nationwide network of electric car battery swap stations and repowering centers in his native Israel. By 2020, the small Middle Eastern country will have an electric car infrastructure so extensive that power docks will be available at most gas stations, train stations and mall parking lots. A smaller-scale project is already underway in Denmark.

Better Place's mechanism for gas stations to switch out car batteries is rather ingenious: The extremely heavy batteries—which weigh approximately 550 pounds each—are swapped out via a robotic mechanism that slides under the car, extracts the old battery and inserts a new one. According to Better Place, the mechanism was adapted from the Israeli Air Forces' procedure for lifting missiles in and out and fighter planes.

Fast Company has written extensively about Agassi in the past. After all, Better Place's plan hits most of the sweet spots when it comes to technology coverage: Agassi is offering an ingenious, ecologically friendly product at a price point that, if done correctly, has the potential to create a massive new market.

Over the past few years, Better Place has recently unveiled large scale networks in Denmark and Japan. Dong Energy, Denmark's largest utility company, signed a massive deal with Better Place enhanced by a separate Danish government agreement to offer a $40,000 tax break on each new electric car purchased and a refueling network based around train station parking lots (Dansk). In Tokyo, Better Place has embarked on another project to create switchable-battery electric taxis.

In Israel, Better Place opened a visitors' center where guests make reservations online (עברית) and get a 90 minute introduction (and, let's be frank, sales pitch) for their electric car. If guests have a drivers license, they can even take one of the cars for a spin. But the one thing they cannot do at the visitors' center is to purchase a car—or even find out where that can be done. Customers are allegedly simply told, "next year."

Within Israel, Better Place has officially registered with the influential Motor Vehicles Importers Association lobby and secured import licenses from the Ministry of Transport. Israeli consumers seeking to purchase electric cars will buy them directly through Better Place and not from Renault.

An unidentified source gave a quote to Israeli business newspaper Globes that implies local car dealers may attempt to sabotage the nascent electric car industry in Israel:

"Better Place's joining the association is like a Trojan Horse. Membership in the association will allow Better Place to obtain early information and prevent measures by regular car importers to foil or delay the deployment of electric cars in Israel, as well as facilitate the venture with the regulators."

But for Better Place, the biggest challenges right now are price point and expansion into larger-size countries. Price point is a problem: Despite deals with multiple nations, the consumer price for an electric car compatible with Better Place's product system is still unknown. An even larger problem is what will be done for countries where longer car rides are the norm. Denmark and Israel are both extremely small states; if Better Place hopes to make inroads in France and Great Britain—let alone the United States, their infrastructure will have to be proven in these pilot areas first.