Renault Bets on Electric Vehicles

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Renault bets that ultimately, the relative simplicity of battery EVs should make them cheaper than plug-in hybrids such as General Motors' Chevy Volt, a vehicle that GM plans to launch in 2010 that will couple a commuter-range battery that can be charged overnight with a gasoline engine-generator to sustain the vehicle on longer trips. "Putting two engines in a car is . . . more complicated, and it's more expensive," says Yoccoz. "Even including infrastructure costs, the electric vehicle is still a better proposition from an economical point of view."

But the downside to Renault's plan is, of course, vehicle range. "We're not talking about holidays," acknowledges Yoccoz. Frank Weber, GM's global vehicle line executive for the Chevy Volt--one of the few full hybrids on display in Paris--calls that a trap: "You don't want to be in exactly this corner where you say, 'Here's this purpose-built little car.'"

Weber predicts that while most drivers don't go very far on a typical day, they will still expect more from a car. He says that EV commuter cars with limited range will remain a niche market, and therefore will never reach the scale needed to bring down costs--especially important when it comes to still-pricey lithium-ion batteries. "Electric vehicles are not a good choice," says Weber.

Yoccoz says that's precisely why automakers that are talking up EVs, such as Renault, Mitsubishi, and Mercedes, are also working to catalyze the installation of charging stations. Renault is working with Project Better Place, based in Palo Alto, CA, to install charging stations in Denmark and Israel, where the company will market its first EVs, starting with the Kangoo and an EV version of an as yet unreleased sedan called the Fluence, targeted at the Israeli market. Daimler, meanwhile, established a partnership with German utility RWE last month to install 500 EV charging points in Berlin, where the carmaker will deploy more than 100 of its EV Smart Fortwos. And this week, Paris said that it would make 4,000 EVs available on its streets in 2010 through an automobile version of Velib, its popular bike-rental program.

Helping to accelerate the development of that charging infrastructure and pushing governments to reward development of ultraclean vehicles is what Yoccoz calls his second and third jobs. "With our usual products, the main job is to find the customers, define what their needs are, and then find a product for their needs," he says. "What we have to do on top of that for the electric vehicle is really redefine a business model."