Why Startup Coda Thinks It Can Compete Against Big Auto


2011 Coda Sedan, final production version

2011 Coda Sedan, final production version

Enlarge Photo

I just spoke to electric car startup Coda’s interim CEO Steven “Mac” Heller, who is stepping in since former chief executive Kevin Czinger stepped down. Heller talked to us from Los Angeles Auto Show, where Coda is showing off its all-electric sedan — and where automotive titans like Toyota and Honda have also unveiled their electric cars.

So Coda has a lot of competition from major automakers, and is competing as an underdog  given that it’s not yet a well-known brand name and is selling its car at $45,000 before state and federal incentives — more than what other soon-to-be-released electric cars are charging. Some analysts have been skeptical of Coda’s success.

But Heller said he’s not worried that the company’s sedan will be coming out later than its competitors. The delays were put in to make “triple-sure” on quality control, he said.

“We believe Coda demand will exceed supply for the next period of time, which is also true broadly for pure EVs (electric vehicles) on the market,” Heller said.

Indeed, the Leaf has 20,000 reservations and analysts have told VentureBeat that Coda is likely to benefit from overflow demand.

Coda Automotive logo

Coda Automotive logo

Enlarge Photo

And the company is intentionally departing from some of the tactics in Big Auto. Heller points out that the company has designed an experience completely different from what consumers are used — and dislike — at dealerships, in particular the haggling that comes when trying to negotiate price. Coda plans to launch stores in high-traffic malls where customers can learn about the cars and electric vehicles in a relaxed, no-pressure sales environment.

“Our consumers in our market, which is right now California, understand that there’s a difference between an all-electric car and an all-electric car company versus …a company whose history, heart, soul and present remains wedded to gasoline and the internal combustion engine,” Heller said. “We think the brand has been created by the (electric car) movement and people understand completely what our values are.”

Initially, it looked like Coda would be set up to compete this December against Nissan’s all-electric Leaf and Chevrolet’s plug-in electric hybrid the Volt. But the company is delaying the car until second half of 2011, and the Nissan Leaf is suffering delays as well, though it will deliver just five cars in December. Coda’s sedan will now instead be coming out around the same time as the Ford Focus Electric — yet another major automaker’s electric car release.

Coda has planned to sell 14,000 cars in its first year in production, about 40 to 50 percent of which it plans to go to fleets, but Heller said they’re remaining flexible on how the company will ramp up to that in monthly sales targets.

The company is also in the process of raising another $125 million before it commences with an IPO.

This story, written by Iris Kuo, was originally posted on VentureBeat's GreenBeat, an editorial partner of AllCasElectric.

 
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