Better Place sees electric cars on roads in 2011

TEL AVIV Sun Feb 7, 2010 8:54am EST

Shai Agassi, founder and chief executive of California-based Project Better Place, poses beside an electric car during a ceremony unveiling the first part of an electric car network in Jerusalem October 22, 2009. REUTERS/Baz Ratner

Shai Agassi, founder and chief executive of California-based Project Better Place, poses beside an electric car during a ceremony unveiling the first part of an electric car network in Jerusalem October 22, 2009.

Credit: Reuters/Baz Ratner

TEL AVIV (Reuters) - Better Place said on Sunday it expects at least 45,000 electric cars on Israeli roads in the next five years, starting in 2011.

The company, which is building a network of charging stations for electric cars in Israel, Denmark and Australia, said it had signed up 92 corporate fleet owners in Israel to rotate in electric vehicles when leases expire in coming years.

"That's one-third of the fleet and half the fleet cars," Shai Agassi, Better Place's founder and chief executive, told Reuters after an event to open a center in Israel to showcase the prototype cars and its electric technology.

He noted that the top 280 fleets in Israel comprise some 100,000 cars.

"By 2020 there will be more electric cars sold per year than gas cars," Agassi said.

Sales of the Renault-Nissan-made electric cars -- which will be manufactured in Turkey -- will be available in Israel next year following tests later in 2010. Sales will be limited to 1,000 cars per month.

"We believe this has real potential," said Nicholas Remise, a manager for Renault's electric car program, adding that past failures were due to a lack of infrastructure.

Agassi noted Better Place was in talks with other automakers but declined to say if or when any deals would be made.

U.S.-based Better Place last month received a $350 million infusion led by HSBC and Morgan Stanley Investment Management, putting the value of the firm at $1.25 billion.

"We think there will be extremely large demand and Better Place can rapidly achieve profitability," HSBC's Mark Norbury told reporters Sunday. "We like Better Place's business model."

Agassi said most of Denmark was already set with charging stations. Israel has about 1,000 such stations and a number of Dor Alon gas stations across the country will have a lane where the heavy 250-kilo battery can be changed should drivers reach the maximum range of 160 kilometers.

By next year, there will be tens of thousands of stations in Israel.

Better Place's concept is for battery-swapping stations to complement a network of charge spots so that electric cars can extend their range without the need of an additional back-up engine that burns fossil fuel.

"We are reinventing a $3 trillion a year market," Agassi said.

He believes the car prices will be far lower than comparable gas-powered autos -- partly due to tax incentives. Taxes on electric cars in Israel will be 10 percent compared with a minimum of 82 percent for gas cars. In Denmark, where taxes on autos are 180 percent, there will be no taxes on electric cars.

Included in the price of the car will be a charging station -- about the size of a fire hydrant -- that will be installed at the customers' home and work. Prices will be announced later in 2010.

Better Place said it strives for battery charging stations to come from renewable energy sources, like wind and solar.

Agassi said Better Place hopes to move into all of Europe.