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Telephones, Computers, Electric Cars and Other Marketing Failures

W. L. Leow analyzes the consumer uptake of electric vehicles compared to other technological innovations, concluding predictions of market failure will join similarly short-sighted pronouncements.

Published: 18-Feb-2013

In some circles in Washington, DC, the future of electric vehicles (EV) has become as hot a topic as sequestration or immigration reform. Some skeptical journalists and policymakers are rushing to declare the entire electric vehicle sector a mistake or failure at the first sign of difficulties. Their rhetoric is cogent, writing lucid, and numbers seem compelling. At first glance, the fact that Americans bought just 71,000 plug-in hybrids or all-electric vehicles in the past two years might make the EV look like a failure. The emergence of EVs, however, needs to be viewed from the framework of technology adoption and diffusion, rather than raw numbers or road trips, to tell the true story.

Today, EVs are the purview of innovators like Elon Musk and Larry Page. In the lifecycle of a new technology’s emergence, that’s where they should be. In this context, the EV is crying at the pains of birth and infancy, rather than convulsing at the death throes of oblivion, as some seem to suggest. Its future depends on continued innovation, the right policies that help EVs transitions to become the primary mode of transportation, and the quite likely rise of gas prices. As important, particularly for those making policy or opining on it here in Washington is an understanding of how consumers adopt technology and how it gets diffused into the marketplace.

Technology adoption and diffusion is hard to predict, and even the most brilliant minds fail at that. Ask Thomas Watson what was on his mind when he thought, “there is a world market for maybe five computers.” Or what were they thinking in Western Union when they dismissed “the telephone has too many shortcomings to be seriously considered as a means of communication.” and concluded that “The device is inherently of no value to” them back in 1876. Harry Morris Warner, of Warner Brothers fame, had his off-day too, like when he questioned “Who the hell wants to hear actors talk?” in 1927.


President Obama announces on March 7, 2012 the EV Everywhere Challenge Daimler Truck factory in Mt. Holly, N.C.

Goal of program is make electric vehicles more affordable and convenient to own and drive than today’s gasoline-powered vehicles within the next 10 years.

EPA rates the Coda electric car at 88 miles per charge, currently the highest range available.

Dave Herron analyses the comparative costs of the current crop of plug-in cars.

Bruce Sargent charges Nissan LEAF in Central Point, Oregon. Photo credit: AP

The stations go from the California border north to the Oregon city of Cottage Grove.


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