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Maggie Kohn headshot

Plug-In Hybrids Make a Comeback in 2020 with Jeep’s New Models

PHEVs

Fiat Chrysler Automobiles (FCA) is hoping what happens at the 2020 Consumer Electronics Show in Las Vegas next week won’t stay there when it shows off Jeep's first three plug-in hybrid electric vehicle models (PHEVs).

The Jeep Wrangler 4xe, the Jeep Compass 4xe and the Jeep Renegade 4xe (the latter, in its most current gasoline-powered model version, is shown above) are all scheduled to debut in 2020 as part of FCA’s broader plans to electrify more than 30 models by 2022.

The news comes almost a year after the very last plug-in hybrid Chevy Bolt, once hailed as an option for consumers whose “range anxiety” prevented them from buying an all-electric vehicle (EV), rolled off an assembly line.

While the models aren’t out yet, CES attendees can take the Jeep 4x4 Adventure Virtual Reality Experience for a ride in the Jeep Wrangler 4xe on Hell's Revenge trail in Moab, Utah. The actual Jeeps promise 240 horsepower, speeds of up to 62 miles per hour in 7 seconds, and the ability to drive up to 31 miles on electric power alone. But if that’s not your speed, FCA is also planning to introduce an electric Maserati Alfieri two-seater this year.

FCA is playing catch-up, and doing so fast

While FCA is investing an estimated $10.5 billion in new electric and hybrid cars, the company has been slower to enter the market than other manufacturers. However, as countries enact stricter emissions standards and cities such as Paris pledge to ban gas-powered cars, it’s trying to catch up in what is shaping up to be a crowded market.

All major automakers have announced plans to increase the number of EV models offered, from today’s 30 models to more than 70 in the next five years. Consultants at McKinsey predict that more than 350 new EV models will debut by 2025.

In addition to Jeep, BMW is preparing to kick off production of the iX3 (an all-electric version of its X3 SUV) in China this year, while Mazda plans to release its first all-electric car. Mercedes is also getting back into the EV business in the U.S. with a family of specially branded battery-powered models, the first of which is expected to be a compact crossover SUV, Forbes reports. 

More consumers are embracing EVs and PHEVs

A decade ago, it was mainly a niche group of affluent, environmentally conscious consumers driving around town in trendy electric cars. Today, more than 60 percent of Americans — with little difference across income levels — say they are interested in electric vehicles. Experts predict that by 2030, 120 million EVs could be on the road in China, the European Union and the United States.

There are a number of reasons to explain the trend. One key factor is economics: The cost of EVs have significantly come down over time. When you add in the availability of federal and state tax credits for EV purchases, the cost is comparable to a traditional gas-powered car. Adding in fuel and maintenance savings, the economics become even more clear.

In California, for example, David Reichmuth, senior engineer at the Oakland-based Union of Concerned Scientists (UCS) estimates that the cost to recharge his Chevy Volt is the equivalent of $1 per gallon, compared with the average $3.82 per gallon cost of regular gasoline. Plus, EVs come with fewer maintenance costs such as oil changes or spark plug replacements.

The cost of battery packs to charge EVs and PHEVs has also fallen dramatically. The price of the battery packs for the first mass-market EVs in 2010 reached $1,000 per kilowatt-hour (kWh), UCS reports. In contrast, Tesla reported that the battery pack for its new Model 3 EV would cost $190 per kWh, while an analysis of General Motors’ Chevrolet Bolt EV calculated a cost of about $205 per kWh.

In addition, the next wave of EVs is expected to operate for increasingly longer periods on a single charge, with some expected to run for up to 400 miles on battery power alone.

Reichmuth of UCS also points to the growing desire among everyday Americans to reduce their own emissions. “People want to take personal action on climate change,” he says — and buying EVs or PHEVs is one way they can.

Plus, there is the convenience factor: More workplaces are adding charging stations for employees, and states such as California are allowing EVs in carpool lanes.

One hiccup in the transition to electric, however, could be the slow development of charging infrastructure, especially within the U.S. Experts call this the “charging-capacity gap” and say the U.S. alone will need a cumulative 13 million chargers and approximately $11 billion of investment by 2030 in order to meet demand. 

Most chargers, over 95 percent, will continue to be in homes and workplaces in the coming years, McKinsey predicted in a recent report. But the bulk of future investment to ensure ongoing uptake of EVs needs to be in public charging stations, such as along highways to allow for long-distance travel and in cities for apartment-dwellers who lack the ability of home charging, and in fast chargers, which come with a much higher price tag. 

The McKinsey study poses an astute question: Who will provide the necessary capital for public charging given the high up-front capital and operating costs and currently low utilization rates?

Not surprisingly, Tesla has taken the bull by the horns and is rapidly building up its charging network, boasting 1,604 Tesla Supercharger Stations with 14,081 Superchargers across the world. However, not all EVs can recharge at these stations, even with an adapter.

According to the company’s website, the automaker is concentrating in urban areas where city dwellers and visitors can easily charge at convenient locations like grocery stores, downtown districts and shopping centers. Tesla also pulling together a network of what it calls Destination Charging Partners, such as hotels, restaurants, shopping centers and resorts.

But no doubt, the EV market has arrived, offering diversity unimaginable even a few years back. (An electric pick-up? Who would have thought!) As 2020 gets underway, it will be exciting to watch manufacturers jostling for visibility and differentiation within the market. Maybe we’ll even see some memorable EV commercials during this year’s Super Bowl if we’re lucky.

Image credit: Jeep

Maggie Kohn headshotMaggie Kohn

Maggie Kohn is excited to be a contributor to Triple Pundit to illustrate how business can achieve positive change in the world while supporting long-term growth. Maggie worked for more than 20 years at the biopharma giant Merck & Co., Inc., leading corporate responsibility and social business initiatives. She currently writes, speaks and consults on corporate responsibility and social impact when she is not busy fostering kittens for her local animal shelter. Click here to learn more.

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