Lucid Motors prototype Lucid Motors
But simply coming up with an appealing design and a fast electric powertrain won't ensure success, according to Joe Phillippi, senior analyst with AutoTrends Consulting. Just ask the numerous other battery-car wannabes, such as Amp Automotive, Bright Automotive and Fisker Automotive, that never made it very far.
Even Tesla — despite the wide praise it receives, the inflated stock price and the modest third quarter earnings — is far from a certified, long-term success. None of its products has ever come to market on time, a real concern for those betting on the upcoming Model 3.
And even after a more than two-year delay, Tesla's Model X battery-SUV has suffered such serious quality problems that influential Consumer Reports magazine has issued a warning to potential buyers.
Two other aggressive new battery-car start-ups have been having their own troubles. Chinese-funded Faraday Future recently had to put work on temporary hold at the $1 billion assembly plant it is building near Las Vegas due to financial concerns.
The delay raises questions about not just Faraday's future, but that of another BEV start-up, LeEco, both backed by the Chinese electronics billionaire Jia Yueting. LeEco ran into its own setback during the official premier of its first car, the LeSee, last month. The prototype shorted out and failed to roll onto the stage during an event in San Francisco.
Related: What is Mystery Car Maker Faraday Up to in the Nevada Desert?[1]Even well-funded establishment automakers have struggled with their electric vehicle programs. Sales have fallen way short of expectations for models like the Ford Focus Electric and the Volkswagen e-Golf. General Motors will face a big test in the coming weeks as it launches sales of the new Chevrolet Bolt, its first long-range, mainstream-priced electric vehicle.
GM has heavily promoted the fact that the Bolt will come in at $29,995 after factoring in a $7,500 federal tax credit on qualifying battery cars. But the incoming Trump administration, backed by a reluctant GOP-controlled Congress, is expected to reconsider that incentive program.
CAFE Culture
The auto industry got something of a mixed blessing when, on Wednesday, the Environmental Protection Agency said it was not going to roll back the aggressive Corporate Average Fuel Economy, or CAFE, standards phasing in between the 2017 and 2025 model-years. To reach the end-goal of 54.5 mpg, industry experts anticipate most new vehicles would have to use some form of electrified drivetrain, from microhybrids to full BEV systems.
Related: With Chao as Transportation Secretarty, Trump May Have Just Built a Bridge to Silicon Valley[2]A forecast by IHS Automotive indicates pure electric model sales could climb into the millions by mid-decade. And some observers believe that is conservative.
But one of president-elect Donald Trump's key policy advisors, John Mashburn, has said the incoming administration would launch a "comprehensive review" of all federal regulations, including another examination of CAFE.
"The brief answer is that we don't know what will occur with a Trump administration and electric vehicles," said Dave Reichmuth, an executive with the Union of Concerned Scientists.
But proponents hope that as battery prices fall, even as vehicle range increases, the government will have less of an impact. "I don't think people are choosing electric cars only because of subsidies," said Annette Winkler, the head of Daimler AG's Smart brand, which is launching a new version of its Fortwo Electric Drive.
Even her competitors have to hope Winkler is right. Billions of dollars of investments, including the new Lucid Motors plant in Casa Grande, hang in the balance.
