Compliance Car Update: Which Electric Cars Are Loss Leaders? Page 2

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Honda Fit EV electric car remote-control key fob showing battery state of charge

Honda Fit EV electric car remote-control key fob showing battery state of charge

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But the scale of these compliance cars thus far has been very small.

No compliance car has sold more than 1,100 vehicles over the course of a model year. Toyota plans to sell 2,600 RAV4 EVs over two years, while Honda's three-year total volume is only 1,100 Fit EVs.

When Honda lowered its lease price on the Fit EV to just $259 a month last summer, to address lagging deliveries, it moved 208 cars last June--and everyone took note. The move also triggered a round of price reductions through the summer.

Other makers haven't been as successful. Since September 2012, the Toyota RAV4 EV has thus far sold only about 60 percent of the announced total of 2,600.

"The RAV4 EV is an example of a vehicle that's priced way too high to satisfy the capacity that they want to put out,” said Shepard. "I think we'll see a drop in the lease price for the RAV4--or we'll just see Toyota abandon it.”

Small scale, small portion of the market

Currently compliance cars are a tiny portion of the battery-electric vehicle (BEV) market as a whole, with the Nissan Leaf and Tesla Model S making up the vast majority of the volume. The Honda Fit EV, Fiat 500e, and Toyota RAV4 altogether add up to just over 5 percent of the market.

2012 Toyota RAV4 EV, Newport Beach, California, July 2012

2012 Toyota RAV4 EV, Newport Beach, California, July 2012

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There are no doubt more compliance cars on the way; but don't get too attached to the current crop, because the list will be very different in a year or two—as well as fuzzier about what makes a compliance car and what doesn't.

Only Fiat has announced that its compliance model, the Fiat 500e, will be produced at the current low volumes for several more years.

"They are a temporary figment on the electric-vehicle landscape," said Shepard. And at this point, a lot of the questions have been answered—such as how the market would react to vehicles with low ranges, after perhaps transitioning from a hybrid with 500 miles of range.

In the not-too-distant future, he suggests, there won't be much space left in the market for such 'small wonder' efforts that color the balance sheet red.

Looking ahead: Pay Tesla, or build plug-ins that sell?

“The program requires more from automakers as it goes out in the future,” said Shepard. "You can't meet the requirements producing the number of vehicles that they  [Honda and Fiat] are producing now."

Tesla Model S

Tesla Model S

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"They're either going to have to bite the bullet and pay Tesla for credits, or they'll have to produce a vehicle, more on the economy side, that will satisfy that mandate."

It's debatable whether compliance cars take away sales from dedicated, for-profit electric models--like the Nissan Leaf.

And while their volume has been only a tiny ripple for the battery industry, positives of the scheme already include that it's helped drive the infrastructure and development of public charge points.

When the leases end, will today's electric-car drivers give back their compliance cars and trade into a plug-in car that's viable business for automakers? And have they convinced at least a few friends, neighbors, or coworkers to plug in as well?

Read on to see the four currently available models that we classify as compliance cars.

Then be sure to browse this full guide of all the other electric and plug-in-hybrid vehicles that are currently on sale.

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