Siemens to End Production of Electric Car Charging Points, Cites Weak Demand

September 03, 2013
By: Christopher Mohr

Weak demand in Germany for electric cars has led to Siemens’ (News - Alert) decision to end production of charging points. Adoption of alternative vehicles has not taken off as much as leaders in the European country hoped.

German chancellor Angela Merkel announced a plan in May 2011 to have one million electric vehicles in Germany by 2020. So far, the numbers for reaching that goal do not show much optimism. About 4,300 e-cars were registered in Germany in 2012. With a population near 80 million, that’s about one e-car per 18,000 people. By comparison more than 51,000 e-cars were registered in the U.S. during that same timeframe, about one e-car per 6,200 people.

Why the difference? One of the reasons may be the lack of government incentives. Although Merkel encourages e-cars, the rest of the German government is not as supportive. E-cars are priced significantly higher than a gasoline equivalent and would be out of reach for most consumers without subsidies. Research by the U.S. Congressional Budget Office indicates that the average lifetime cost of an electric car is $12,000 more than a conventional one.

The inconvenience of electric cars is likely another factor. The Nissan Leaf only has a range of 73 miles. With a lack of charging stations in Germany, Siemens’ withdrawal from the market only compounds the problem.

Siemens has developed electrical solutions for transportation for years with trains and trolley systems that run on overhead electrical lines. In 2012, the company developed an ‘electric highway’ solution that uses the same technology with commercial trucks. The technology may also be adopted along the 710 freeway in the Los Angeles area, which is heavily used by freight trucks carrying payloads from the Port of Los Angeles. This limited use of electrical vehicles would cut down on emissions in the communities along the 710, but widespread use of the technology isn’t practical.

With electrical vehicle technology, many advances have to be made before it replaces fossil fuels. In Germany, subsidies would encourage more purchases of e-cars, but by itself, that’s not the answer. The U.S. government subsidizes electric vehicles and has three times more registered vehicles per capita than Germany, but only a fraction of one percent of the American public drives e-cars. Until the infrastructure to charge vehicles becomes more widespread, the range improves and recharging doesn’t take so long, electric vehicles won’t displace the internal combustion engine in the near future.

Edited by Rachel Ramsey